Coming to Grips with Use

Customs and Border Protection and the U.S. Department of Justice have strenuously defended the position that locking pliers should be classified as wrenches. They found support for this in a 1983 decision of the Court of International Trade in which the Court found that items (possibly incorrectly) described as "Vise Grips" were used to twist, or "wrench" items and, therefore, were classified as wrenches under the old Tariff Schedules of the United States.

In Irwin Industrial Tool Co. v. United States, the Court of International Trade held that under the Harmonized System, pliers are versatile two-handled tools with jaws that pivot to squeeze an object. A wrench, on the other hand, is a tools with a head, jaw or socket that snugly fits around the head of a fastener and that provides leverage to turn the fastener. Applying these definitions, locking pliers like the ones below are not wrenches even though they can be used (or misused) to "wrench" a stuck bolt or similar item.

The United States appealed. The Federal Circuit has now affirmed.

This seems remarkably straight-forward. Tariff language is interpreted consisted with its common and commercial meaning. These items are commonly and commercially known as locking pliers (although there is some evidence to the contrary). That should resolve the dispute.

But, tariff classification is often not that easy. The question here, complicated by cases such as GRK Canada, is whether we are dealing with purely eo nomine classifications or whether use is relevant to the classification. The government took the position that a wrench is a tool used to twist an object. Locking pliers, according to the government, are designed to allow for continuous pressure while applying torque, as one would with a wrench.

The Court first held that the term "pliers" is eo nomine and not defined by use. The Court looked at dictionary definitions and industry standards to identify pliers as two-handled tools with a pivoting jaw. A similar analysis showed that "wrench" is an eo nomine term defined by physical characteristics that adapt the tool to snugly engage the head of a fastener. Importantly, the Court of Appeals held that "Even though the record suggest that the tools may be designed for a particular use, we determine that the language of the particular headings here does not imply that use or design is a defining characteristic." 

I do not disagree with this at all. In fact, I emphatically agree.

But, I am left confused about when a tariff term will suggest a use and when, therefore, evidence of use consistent with that suggestion is relevant for classification purposes. This is the GRK problem. "Wrench," after all, is also a verb. The way to clear this up is to backtrack from the notion that evidence of use is relevant without specific language in the tariff heading indicating that use is contemplated as part of the meaning. In Irwin, the Federal Circuit notes that the language of these two headings does not contain signals suggesting a specific use. As examples, it noted "articles of a kind normally carried in the pocket . . ." and "preparations therefor." 

I can see "preparations for" something indicating an intended use. If something is prepared for a sauce, it seems that evidence of use in a sauce is relevant to the classification. On the other hand, the fact that something is normally carried in the pocket is a little removed from its actual use as few things are useful simply by virtue of being carried in the pocket. That thing in my pocket is a key, wallet, or phone all of which have distinct uses. It strikes me that the feature of normally being carried in the pocket points to design and physical criteria more than use.

The drafters of the HTS know how to signal a use provision. Here are some examples:

0504.00.00 Guts . . . for use as sausage casing

3401           Organic surface-active products and preparations for use as soap

8483.40.30 Gear boxes . . . imported for use with machines for making [paper products]

This is distinct from terms such as "suitable for use with" or "designed for use with." These phrases indicate, to me at least, that the proper inquiry remains with the physical characteristics of the product. Something is suitable for use with something else if its physical characteristics allow it to be used in that way, regardless of whether it is so used. Of course, there is an outer limit at which it becomes absurd. A crankshaft is suitable for use as an anchor but doing so is not economically rational. "Designed for use" also indicates, to me, that the Court should be looking at the features and characteristics of the item that indicate a design intention. If there is some feature that prevents or significantly interferes with the identified use, then the item is not designed for that use. 

Classification is a legal analysis. It is, at the same time, also performed every day by thousands of non-lawyers who are engaged in making compliance decisions for importers large and small. Even licensed brokers are not always fully aware of the details of the legal analysis of tariff language. Bright line tests are necessary to facilitate trade and to avoid creating traps for the average importer, for whom the statute is allegedly written in the language or ordinary commerce.