Water Gas Generators Not 'Parts,' Importer Argues at Trade Court

A supermodule for use in hydrogen fuel-cell power plants is correctly classified as a water gas generator, not as "parts" of electric generators, fuel cell manufacturer and generator importer HyAxium said in a May 15 response brief at the Court of International Trade. HyAxium asked the court to rule that the PC50 supermodules are properly classifiable under Harmonized Tariff Schedule heading 8405 and to dismiss the government's cross-motion for judgment (HyAxium v. U.S., CIT # 21-00057).

The primary function of the PC50 supermodule is to generate a water gas and there is "no dispute" that it does this, HyAxium said. The supermodule at issue generates water gas and the government's attempt to "muddy the waters" by focusing on a false distinction between synthesis gas and water gas even though the tariff schedule makes no distinction, HyAxium argued. The presence of carbon dioxide and steam does not negate the fact that the supermodule generates water gas.

In its March 15 motion for judgment, the government sought to impose limitations that did not exist in the explanatory notes on how a water gas generator must operate and the type of fuel source that must be used, HyAxium said. The explanatory notes to chapter 84 do not limit water gas generators as the government would like because it covers "all forms of water gas generators, not just a limited set," HyAxium said (see 2303150062).

The water gas generators described in the HTS are not required to be self-contained items as the government claims, HyAxium argued. Chapter 84's explanatory notes do not require that only self-contained water gas generators are covered because to do so would contradict the inclusion of water gas generators “with or without their purifiers,” HyAxium said.

Finally, HyAxium argued, the PC50 is not "more than" a water gas generator as argued by the government. Language in Chapter 84 suggests that the category of water gas generators was intentionally broad, HyAxium said. The supermodule components cannot be “more than” a water gas generator because most of the components in the PC50 supermodule support the generation of water gas. The "essential character" of the supermodule is that of a water gas generator and any additional components support the primary function of water gas generation, HyAxium said.