CLA-2 CO:R:C:G 087299 JMH
Mr. Larry Wong
Executive Vice President
Integrity Technology
105 Serra Way, Suite 230
P.O. Box 360604
Milpitas, CA 95035-0604
RE: Revocation of Headquarters Ruling Letter 083115, floppy
diskette clamshell
Dear Mr. Wong:
This is to inform you that Headquarters Ruling Letter
083115 ("HQ 083115"), dated May 18, 1989, has been revoked in
accordance with Customs Regulation 177.9(d), 19 C.F.R. 177.9(d)
(1989). The following is the proper classification of the
subject floppy diskette clamshell subassembly.
FACTS:
The articles in question are floppy diskette clamshells
which act as the protective covering or holder for magnetic
discs. The plastic clamshells and the magnetic discs from floppy
diskettes. Floppy diskettes are used with automatic data
processing machines ("ADPs").
The floppy diskette clamshells consist of two flat pieces of
molded plastic measuring 3.5 inches square and 1/16 inch thick,
two circular fibrous discs, and a steel shutter. The two flat
pieces of molded plastic are secured together on one side. The
other three sides are left unsecured to allow further assembly
after importation. The two circular fibrous discs line the
inside of each of the two clamshell halves. The steel shutter
with a loaded spring return is fitted onto one side of the
clamshell assembly.
After importation, the clamshell is opened and a magnetic
media is inserted. The finished diskette is inserted into a
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computer's disc drive. Once in the drive, the diskette is
locked into place, the shutter opens and the magnetic media, the
disc, is exposed to the drive heads.
ISSUE:
What is the proper classification under the Harmonized
Tariff Schedule of the United States Annotated ("HTSUSA") for the
plastic floppy diskette clamshell, with the circular fibrous
discs, and the steel shutter with a loaded spring return, but
without the magnetic media?
LAW AND ANALYSIS:
The classification of merchandise under the HTSUSA is
governed by the General Rules of Interpretation (GRI's). GRI 1,
HTSUSA, states in part that "for legal purposes, classification
shall be determined according to the terms of the headings and
any relative section or chapter notes...and according to the
following provisions..."
HQ 083115 classified the clamshells within subheading
8473.30.40, HTSUSA, as "Parts and accessories...suitable for use
solely or principally with machines of headings 8469 to
8472...Parts and accessories of the machines of heading
8471...Not incorporating a cathode ray tube..." Heading 8471,
HTSUSA describes automatic data processing machines ("ADPs").
The classification within heading 8473, HTSUSA, was reached in HQ
083115, after the determination that the plastic clamshells were
not "Bobbins, spools, cops, cones, reels or similar supports, of
any material..." These items are excluded from classification
within Section XVI, HTSUSA, by Section XVI, Note 1(c), HTSUSA.
HQ 083115 stated that "the articles referred to in Note 1(c) are
articles that form a core on which something is typically wound,
and the magnetic media inserted into a diskette clamshell is not
wound..." See HQ 083115, p. 2. The clamshells were then
classified within heading 8473 because of Section XVI, Note 2(b),
HTSUSA. Section XVI, Note 2(b) requires that a part used solely
or principally with a machine of chapter 84 or 85 is to be
classified with that machine.
This office continues to believe that the plastic clamshells
are not "bobbins, spools, cops, cones, reels, or similar
supports" for the reasons stated in HQ 083115. However, HQ
083115 failed to address Chapter 85, Note 6, HTSUSA. Chapter
85, Note 6 requires that unrecorded media remain classified
within heading 8523, HTSUSA, "whether or not they are entered
with the apparatus for which they are intended." Heading 8523
describes "Prepared unrecorded media for sound recording or
similar recording of other phenomena, other than products of
chapter 37..."
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The recording media within micro floppy diskette clamshells
is unrecorded media within the meaning of Chapter 85, Note 6 and
is classified within heading 8523 when entered without the
plastic clamshell. Complete or finished unrecorded micro floppy
diskettes, consisting of both the plastic housing and the
recording media, are also classified within heading 8523. See
Headquarters Ruling Letter 086851 ("HQ 086851"), dated April 9,
1990.
Since the subject merchandise is only the plastic clamshell,
it is an incomplete floppy diskette. GRI 2(a), HTSUSA, one of
"the following provisions" mentioned in GRI 1, requires that
references to an article in a heading include references to that
article in an incomplete or unfinished state, providing the
incomplete or unfinished article has the essential character of
the complete or finished article.
It is the opinion of this office that the essential
character of a floppy diskette is imparted by the magnetic media
within the diskette. The magnetic media is the most expensive
part of the diskette. The plastic clamshell simply protects the
media. Since the magnetic media is absent at the time of entry,
the plastic clamshells in question do not have the essential
character of a complete or finished floppy diskette. Therefore,
the plastic clamshells cannot be classified under heading 8523.
As stated previously, Section XVI, Note 2(b) requires that
parts used solely or principally with a particular kind of
machine are to be classified with that machine. Section XVI,
Note 5, HTSUSA, defines "machine" as "any machine, machinery,
plant, equipment, apparatus, or appliance cited in the headings
of chapter 84 or 85." In order for the clamshell to be
classified within heading 8473, the article it is a part of must
be classified within heading 8473. A floppy diskette is not a
part or an accessory of ADPs to be classified within heading 8473
because of Chapter 85, Note 6.
The plastic clamshell is a part of a micro floppy diskette.
Magnetic media or a micro floppy diskette is "equipment" or
"apparatus" within Section XVI, Note 5. The provisions of
heading 8523 do not include a subheading for parts. Therefore,
the plastic diskette clamshell, although used solely or
principally with floppy diskettes or magnetic media cannot be
classified under heading 8523.
Since the plastic diskette clamshells cannot be classified
as a part of micro floppy diskettes, the clamshells must be
classified according to their constituent material. The
clamshells consists of three materials, plastic, steel and a
fiber, each of which are described in different headings. When
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goods are classifiable under two or more headings, GRI 3,
HTSUSA, must be utilized. GRI 3(a) states that the most specific
description is preferred among the possible classifications, but
when the headings refer to only part of a composite good, the
headings are equally specific. The clamshells, consisting of
plastic, steel and a fiber are composite goods. Thus, no heading
is more specific than the others.
When articles cannot be classified according to GRI 3(a),
GRI 3(b), HTSUSA, must be used. GRI 3(b) states that a composite
good is to be classified according to the component which gives
the good its essential character. The plastic of the clamshell
gives the floppy diskette clamshell its essential character. The
plastic is the most important component. It provides the
configuration of the floppy diskette with which users are
familiar. Therefore, the clamshell should be classified as an
article of plastic.
Plastics an articles articles thereof are covered by Chapter
39, HTSUSA. Chapter 39, Note 1(o), HTSUSA, excludes "Articles of
section XVI (machines and mechanical or electrical appliances)"
from classification within chapter 39. The exclusionary language
suggests that complete machines were meant to be excluded from
Chapter 39. This language would also cover parts of machines
that have provisions within Section XVI. However, the plastic
clamshells are not provided for within Section XVI as a machine
or a part. Therefore, the proper classification for the floppy
diskette clamshell is under subheading 3926.90.90, HTSUSA, as
"Other articles of plastics and articles of other materials of
heading 3901 to 3914...Other...Other..."
HOLDING:
The floppy diskette clamshell is a composite good consisting
of plastic, steel and a fiber. As a composite good, it must be
classified according to the component which provides the
clamshell's essential character. Plastic provides the essential
character of the clamshell. Therefore, in accordance with GRI
3(b), the correct heading for the floppy diskette clamshell is
heading 3926, which describes "Other articles of plastics and
articles of other materials of heading 3901 to 3914...." The
proper classification for the floppy diskette clamshell is under
subheading 3926.90.90, HTSUSA, as "Other articles of plastics and
articles of other materials of heading 3901 to 3914...Other...
Other..." The rate of duty applicable to this classication is
5.3 percent ad valorem.
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HQ 083115 is revoked in accordance with Customs Regulation
177.9(d), 19 C.F.R. 177.9(d) (1989).
This office recognizes that pending transactions may be
adversely affected by this revocation. Should this situation
arise, you may notify this office and apply for temporary relief
from the binding effects of this ruling. Such a request would
be pursuant to Customs Regulation 177.9(d)(3), 19 C.F.R.
177.9(d)(3).
Sincerely,
John Durant, Director
Commercial Rulings Division