Racing Car Is Collector's Item, Not Used Vehicle, Importers Say

July 19, 2024 by Jacob Kopnick|Penalties and Courts

Importers Yellow Bird and Vantage Point filed a complaint at the Court of International Trade July 18 arguing that a 1955 Jaguar race car, driven in competitions by multiple Australian racing drivers, is a collector's item, not a used motor vehicle (Yellowbird Enterprises v. U.S., CIT # 24-00121).

The car, a Jaguar D-Type XKD Chassis 526, competed in Formula One and Gran Turismo races from 1955 to 1970. The vehicle was largely kept in Australia until being imported to Atlanta in July 2023.

CBP liquidated the vehicle under Harmonized Tariff Schedule subheading 8703.24.0190, which provides for used motor vehicles mainly designed for the transport of persons, including station wagons and racing cars, dutiable at 2.5%. The importers said the car should be included under HTS subheading 9705.10.0090, free of duty, which provides for collectors' pieces. CBP denied the companies' protest, telling the importers that not all collectors' items qualify for heading 9705.

Yellow Bird and Vantage Point pointed to a CBP customs ruling in 2012 that found that the 1953 Jaguar C-type XKC Chassis 038 fit under subheading 9705.00.0070, free of duty. The companies noted that this subheading was ultimately succeeded by subheading 9705.10.0090 in the May 31 changes to the HTS.

In denying the companies' protest, CBP "made no mention" of its 2012 ruling or why the 1953 Jaguar fits under heading 9705, but the 1955 car doesn't, the importers said.

The importers also drew attention to a headquarters ruling that revoked two prior rulings on a 1937 Alfa Romeo Touring Car that was never "owned or driven by a famous person" and "had no connection with an historic car race." The ruling pointed to 11 prior CBP rulings classifying cars under heading 9705, including the 2012 ruling, and said the Alfa Romeo, unlike the cars in the prior 11 rulings, wasn't used in any "historic auto races" or "driven by well-known race car drivers."

CBP also "made no mention" of this HQ ruling or the prior 11 rulings, the complaint said.

The importers argued that the criteria for classification under subheading 9705.10.0090 includes "historical interest, famous ownership, and famous races," and that they have established that the car at issue plainly is one of historical interest.

Yellow Bird and Vantage Point filed a Freedom of Information Act request in May, asking for any communications from CBP on the "classification of former race cars of particular historical interest, uniqueness, rarity and value which are in fact collected for those reasons as other than collector's items under HTSUS Heading 9705 and instead under Heading 8703." The request also asked for the information CBP uses to determine what qualifies as a "famous race" or "well-known driver." The agency didn't provide any information in response.

Chris Kane, counsel for the companies, said in an email that the case may be "ripe for settlement," due to the existence of "several pending protests" at CBP on the same issue.