Importer Sues at Trade Court Over Classification of Offroad Vehicles

Offroad utility vehicles should be classified as passenger rather than cargo transporters, importer MTD said in an Aug. 5 complaint to the Court of International Trade (MTD Consumer Group Inc. v. U.S., CIT # 22-00233).

MTD said entries for six of its recreational off-highway vehicles (ROVs) were incorrectly classified by CBP as "motor vehicles for the transport of goods" under heading 8704 of the Harmonized Tariff Schedule of the U.S. The correct classification, MTD said, is under heading 8703 as “[m]otor cars and other motor vehicles principally designed for the transport of persons (other than those of 8702), including station wagons and racing cars.”

MTD is seeking a refund of all duties, which it says were incorrectly assessed, plus interest, arguing that the classification goes against several customs rulings "classifying virtually identical ROVs under Heading 8703, HTSUS" and court rulings that "a vehicle’s intended persons must outweigh an intended purpose of transporting goods." MTD also cited various design features and marketing that point to the vehicles primary purpose as recreational passenger vehicles.

"CBP’s liquidation or reliquidation of the subject entries under Heading 8704, ... had the effect of revoking or modifying CBP’s longstanding UTV rulings," MTD said. "Thus, CBP’s failure to publish notice of the decisions ... was in violation of Section 1625 and the liquidations were contrary to law."