CLA-2 CO:R:C:G 085404 MBR

Mr. Steven W. Baker
Bellsey and Baker
100 California Street, Suite 670
San Francisco, California 94111

RE: 9100 Mobile Radio Data Terminal, 9031 Universal Mobile Communications Terminal, 7100 Dispatch Terminal, 7031 Dispatch Terminal, 6100 Portable Data Terminal

Dear Mr. Baker:

This is in reply to your request for classification of the 9100 Mobile Radio Data Terminal, 9031 Universal Mobile Communications Terminal, 7100 Dispatch Terminal, 7031 Dispatch Terminal and 6100 Portable Data Terminal, under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA).

FACTS:

The following mobile data terminals (MDTs) are all installed in vehicles (except the portable 6100) such as: taxis, police cars, delivery vehicles, sales personnel vehicles, repair vehicles, etc. They all are either connected to a radio transmitter/ receiver (by cables) or have an integrated radio (models 9100 & 6100). These MDTS communicate with a host computer by radio communication (general purpose computer not imported or sold with the MDTs). The host computer's function is primarily the transmission/ reception with a number of units through radiotelegraphic communication. Some MDT units provide data base access, however, the subject MDTs are principally designed, dedicated and used for dispatching and other messaging applications.

9100 Mobile Radio Data Terminal. ("9100").

Your literature states that the 9100 is "the flagship product of the new SYSTEM 100 family designed to solve your communication needs. The Terminal, combined with our data communications system, offers constant, real-time, two-way communications for your people on the move. The four basic functions you require-dispatch operations, database access, fleet status monitoring, and messaging capability-are simple, accurate and instantaneous....The rugged, single-piece unit with its integrated radio is built to last." The 9100 includes; a 16 line by 32 character amber CRT display, a full alphanumeric keyboard, a separate functions keypad and power and illumination controls. It transmits data at a rate of 4800 bits per second with modulation based on FM. The radio transmitter operates in a frequency range of 806 to 825 MHz. The radio receiver operates in a frequency range of 851 to 870 MHz.

9031 Universal Mobile Communications Terminal. ("9031").

The 9031 is very similar to the 9100. The 9031 is a mobile data terminal which includes; a 16 line by 32 character CRT display, a full alphanumeric keyboard, and a separate functions keypad. However, the 9031 utilizes an 8100 voice radio (which also transmits and receives data) rather than having a voice radio integrated within the system, like the 9100.

7100-10 Mobile Communications Terminal. ("7100").

Your promotional literature states; "This terminal was specifically designed to meet the requirements of the dispatching services market." This terminal sends and receives text messages over standard voice quality FM radio channels. Data transmission supports a larger number of dispatches than conventional voice dispatched systems thereby reducing radio channel congestion. When the terminal receives a message it sounds an audible alert and an indicator lights up telling the driver a message is waiting to be displayed. All messages are stored in terminal memory until the driver clears them (up to six pages of 10 lines by 32 characters each). The terminal has a back lit 4 line by 40 character LCD display. The keyboard has function commands and a numeric keypad but no alpha keyboard. The 7100 is designed to function with an 8300 radio (or an approved third party model). The terminal can support external peripheral devices such as a printer, bar-code reader, etc., through a serial RS-232C connection at the base of the unit. The 7100 is based on the 4.0 MHz Z80 microprocessor with 64K bytes of EPROM (Erasable Programmable Read Only Memory), 24K bytes of RAM plus 1K bits of E2 PROM. The terminal software is stored in EPROM while the radio parameters are stored in E2 PROM.

7031 Computerized Taxi Dispatch. ("7031").

Mobil Data International's computerized taxi dispatch system works in the following manner: 1) Customer calls cab company, 2) Call taker enters information into central computer, 3) Computer sends information to first taxi in line for a passenger in the appropriate zone, 4) Driver hits a key on the terminal indicating acceptance of the trip, and 5) Driver picks up customer. The 7031 measures 2.6" x 11.4" x 5.5." It weighs 2.75 lbs and is mounted in a taxi driver's windshield. It has a two line, forty character back lit LCD display. Its keyboard contains; 8 single- stroke keys, 6 key sequences (F plus another key), 0-9 numerals, TX-initiates transmissions, Nm-displays next message, MDI- emergency, auto TX (continues transmitting until acknowledged received). It has a memory capable of retaining six pages (maximum of ten lines per page). The modem data rate is 4800 bps with a modulation baseband of FM.

6100 Portable Data Terminal. (6100)

The 6100 is a portable data communications terminal with the following features: 1) Automatic storage and quick retrieval of messages and dispatches (with external "message received" LED indicator, 2) Built-in 800 MHz radio transmitter and receiver with internal antenna, 3) Factory installed voice option, 4) Back lit, high contrast, 8 line by 40 character LCD display, and 4) message capacity of 100 lines. Your literature states: "[i]t is designed for people who require two-way data communications with them at all times in order to perform their job activities. With an MDI 6100 PDT, personnel can receive dispatches, query data bases, and enter data to a host computer. In addition, they can compose and transmit messages to, and receive messages from, fellow co-workers."

ISSUE:

What are the classifications of; 9100 Mobile Radio Data Terminal, 9031 Universal Mobile Communications Terminal, 7100 Dispatch Terminal, 7031 Dispatch Terminal and 6100 Portable Data Terminal, under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA)?

LAW AND ANALYSIS:

The General Rules of Interpretation (GRI's) to the HTSUSA govern the classification of goods in the tariff schedule. GRI 1 states, in pertinent part:

...classification shall be determined according to the terms of the headings and any relative section or chapter notes...

Classification of Goods Under General Rule of Interpretation 1 of the Harmonized System, Customs Bulletin and Decisions, Vol. 23, No.36 (September 6, 1989), states, in pertinent part, that classification under GRI 1 proceeds as follows:

(1) If the nature or make-up of the goods reveals a function (a specific intended use), then the proper function-related chapter must be examined. First, it must be determined that the function of the article is indeed included in the chapter. Next, the section and chapter notes must be consulted to ensure that classification of the article is not ruled out by a legal note....Consideration must also be given to the possibility that more than one function related chapter may apply.

The nature and make-up of the Mobile Data Terminals ("MDTs") reveals their function to be two-fold.

Firstly, the MDTs' function is that of transmission apparatus for radio-telegraphy, i.e., "for the transmission of signals (representing speech, messages or still pictures) by means of electro-magnetic waves which are transmitted through the ether without any line connection." Harmonized Commodity Description and Coding System Explanatory Notes (EN), page 1374.

Secondly, the MDTs use radiotelegraphic transmission and reception to communicate with their host computer. You state that the host computers are general purpose computers, usually already in place at the customers site, which meet the definition of "Automatic Data Processing Machines" as delineated in chapter 84, Note 5, for the purposes of inclusion in heading 8471, HTSUSA. Therefore, you argue that the MDTs' function is that of an ADP input/output unit.

Thus, the MDTs are prima facie classifiable under two function-related headings. The headings are 8525 and 8471, HTSUSA. These headings describe:

8525 Transmission apparatus for radiotelephony, radiotelegraphy, radiobroadcasting or television, whether or not incorporating reception apparatus...:

8525.10.80 Transmission apparatus: [o]ther: [o]ther.

8525.20.60.80 Transmission apparatus incorporating reception apparatus: [o]ther: [o]ther: [o]ther."

* * * * * * * * * * * * *

8471 Automatic data processing machines and units thereof;

8471.92.10 Other: [i]nput output units, whether or not entered with the rest of a system and whether or not containing storage units in the same housing: [c]ombined input output units.

Section XVI, Legal Note 4, provides guidance here: "where a machine (including a combination of machines) consists of individual components (whether separate or interconnected by piping, by transmission devices, by electric cables or by other devices) intended to contribute together to a clearly defined function covered by one of the headings in chapter 84 or chapter 85, then the whole falls to be classified in the heading appropriate to that function."

It is Customs position that the MDTs are principally intended to contribute to the clearly defined function of transmission apparatus in chapter 85 and therefore must be classified in this chapter.

Legal Note 5, chapter 84, also states: "[h]eading 8471 does not cover machines incorporating or working in conjunction with an automatic data processing machine and performing a specific function. Such machines are classified in the headings appropriate to their respective functions or, failing that, in residual headings."

Furthermore, Legal Note 7, chapter 84, states: "[a] machine which is used for more than one purpose is, for the purposes of classification, to be treated as if its principal purpose were its sole purpose. Again, clearly the principal purpose of these MDTs is the transmission of messages.

Your literature states: "Mobile Data International's Computerized Taxi Dispatch system can increase productivity, help provide better service to your customers, improve working conditions for your drivers and, most importantly...give you a significant advantage over the competition." There can be no question that MDTs are simply an improvement in technology over the traditional hand held, voice dispatch systems. In American Scientific Products, Div. of American Hospital Supply Corp. v. United States, Slip. Op. 90-49 (May 14, 1990) the court cited Texas Instruments Inc. v. United States, 1 CIT 236, 244, 518 F.Supp. 1341, 1346 (1981) (where the court held that tariff schedules "are written for the future as well as for present application and may embrace merchandise unknown at the time of their enactment" as long as such merchandise possesses an essential resemblance to the characteristics as described by the applicable tariff provision), aff'd, 69 CCPA 136, 673 F.2d 1375 (1982). In Scientific Products, page 14, the court held that:

Similarly, the [blood] analyzers cannot realistically be called data processors because although, as plaintiff notes, the data-processing function of the hematology analyzers is essential to the analysis of the blood, it is nonetheless only a component of a machine whose overall purpose is to analyze. The machines' functions are to break blood up into its parts, quantify each, and determine the various qualities.

Similarly, although the MDTs transmit and receive data from/to the host computer, their principal function is that of transmission apparatus for radio-telegraphy, i.e., for the transmission of signals (representing speech, messages or still pictures) by means of electro-magnetic waves which are transmitted through the ether without any line connection.

These MDTs are distinguishable from laptop or remote location, radio linked automatic data processing input/output terminals by their principal function of dispatching, i.e., for the transmission of signals (representing speech, messages or still pictures) by means of electro-magnetic waves which are transmitted through the ether without any line connection. See HQ 554810 (TSUS Protest) for a similar holding on this merchandise.

HOLDING:

The MDI 9100 is integrated with a radio transmitter/ receiver, and is therefore classifiable under 8525.20.60.80, HTSUSA, which provides for: "[t]ransmission apparatus for radiotelephony, radiotelegraphy...whether or not incorporating reception apparatus...: [t]ransmission apparatus incorporating reception apparatus: [o]ther: [o]ther: [o]ther." The rate of duty is 6% ad valorem.

The MDI 6100 is integrated with a radio transmitter/ receiver, and is therefore classifiable under 8525.20.60.80, HTSUSA, which provides for: "[t]ransmission apparatus for radiotelephony, radiotelegraphy...whether or not incorporating reception apparatus...: [t]ransmission apparatus incorporating reception apparatus: [o]ther: [o]ther: [o]ther." The rate of duty is 6% ad valorem.

The MDI 9031 does not have an integrated radio (requires the addition of MDI 8100 voice/data radio) and is therefore classifiable under 8525.10.80, HTSUSA, which provides for: ""[t]ransmission apparatus for radiotelephony, radiotelegraphy...whether or not incorporating reception apparatus...: [t]ransmission apparatus: [o]ther: [o]ther." The rate of duty is 6% ad valorem.

The MDI 7100-10 does not have an integrated radio (requires the addition of MDI 8300 voice/data radio or approved third party model) and is therefore classifiable under 8525.10.80, HTSUSA, which provides for: ""[t]ransmission apparatus for radiotelephony, radiotelegraphy...whether or not incorporating reception apparatus...: [t]ransmission apparatus: [o]ther: [o]ther." The rate of duty is 6% ad valorem.

The MDI 7031 Computerized Taxi Dispatch does not have an integrated radio and is therefore classifiable under 8525.10.80, HTSUSA, which provides for: ""[t]ransmission apparatus for radiotelephony, radiotelegraphy...whether or not incorporating reception apparatus...: [t]ransmission apparatus: [o]ther: [o]ther." The rate of duty is 6% ad valorem.

Sincerely,

John Durant, Director
Commercial Rulings Division