CLA-2 CO:R:C:M 952973 MBR
Mr. Dennis Heck
Tower Group International, Inc.
5420 West 104th Street
Los Angeles, CA 90045
RE: Modification of HQ 952246; Modification of NY 843928;
Modification of NY 849402; Epson America, Inc.; Liquid Crystal
Display; LCD; Signaling; ADP Display; 8531; 8471; 9013; HQ
951609; HQ 951288; HQ 952360; HQ 086929; E.M. Chemicals v.
United States
Dear Mr. Heck:
This is our reply to your letter of November 24, 1992,
requesting reconsideration of HQ 952246, dated November 10, 1992,
regarding the classification of Liquid Crystal Displays (LCDs),
under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
EPSON's dot matrix LCD modules consist of a newly developed
TN and STN positive/reflective type liquid crystal display with
high-contrast, wide-viewing angle and wide operating temperature
range, C-MOS LSI driver and controller. EPSON's easily installed
LCD modules have a multiple instruction set, and a wide variety of
applications. The provided literature delineates the following
applications: portable computers, hand-held terminals, computer
terminals, word processor/typewriters, instrument devices, POS
terminals, telecommunications terminals, and synthesizers. The EA
and EG-X Series have built-in DATA RAM for display data
storage/refresh on board which provide for easy microprocessor
interface with most CPUs.
The features of the EA Series are as follows: alphanumeric and
special symbols, 5 x 7 dot matrix with cursor, 5 x 11 dot matrix
without cursor, 5 x 12 dot matrix without cursor, and 16 to 80
character display.
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The EG Series features are as follows: 1/64 to 1/242
multiplexing, graphics and characters, special controller. The EG-
X Series provides easy connection to the bus line of most 4-bit/8-
bit microcomputers, and has both graphics and characters.
You also import "LCD Panels" which consist of a twisted
nematic liquid crystal cell sandwiched between two polarizers in
which light enters the first polarizer in one plane, is twisted and
passes through the second polarizer resulting in a light colored
background. When one of the transparent pixels is activated, the
twist is inhibited and the second polarizer blocks the light
creating a dark pixel. In their imported condition, these LCD
sandwiches do not contain a printed circuit board, row and column
drivers, or integrated circuits of any kind. However, at
importation they do have either rubber connectors, heat seal
connectors, or dual-in-line (DIL) pin connectors.
The Test and Control Module (TCM) and the Epson Custom Module
(ECM) contain row and column drivers and are utilized as ADP
displays, fish finders, point of sale terminals, medical equipment,
etc.
ISSUE:
Are the instant liquid crystal displays classifiable under
heading 8531, HTSUS, which provides for electric sound or visual
signaling apparatus, or under heading 8471, HTSUS, which provides
for ADP output devices, or under heading 9013, HTSUS, which
provides for liquid crystal devices, under the Harmonized Tariff
Schedule of the United States (HTSUS)?
LAW AND ANALYSIS:
The General Rules of Interpretation (GRI's) to the HTSUS
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...
Liquid crystal displays (LCDs) are prima facie classifiable
under the following subheadings:
8531 Electric sound or visual signaling apparatus (for example,
bells, sirens, indicator panels...
8531.20.00 Indicator panels incorporating liquid crystal
devices (LCD's) or light emitting diodes (LED's)
* * * * * * * * * * * * * *
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9013 Liquid crystal devices not constituting articles provided for
more specifically in other headings
9013.80.60 Other devices, appliances and instruments: Other
* * * * * * * * * * * * * *
8471 Automatic data processing machines and units thereof
8471.92.30 Other: Input or output units...: Other: Display
units: Without cathode-ray tube (CRT), having a
visual display diagonal not exceeding 30.5 cm
* * * * * * * * * * * * * *
Heading 8531, HTSUS, provides for electric sound or visual
signaling apparatus. Therefore, to be classifiable in this
heading, the apparatus must be designed for "signaling," as that
term is defined for tariff purposes.
The Harmonized Commodity Description and Coding System
Explanatory Notes (ENs) to heading 8531, HTSUS, page 1381, are
fairly descriptive and restrictive as to the types of "signaling"
indicator panels and the like must perform in order to be
classifiable in that provision. It states: "[t]hese are used
(e.g., in offices, hotels and factories) for calling personnel,
indicating where a certain person or service is required,
indicating whether a room is free or not. They include:
(1) Room indicators. These are large panels with numbers
corresponding to a number of rooms...
(2) Number indicators. The signals appear as illuminated
figures on the face of a small box; in some apparatus of
this kind the calling mechanism is operated by the dial
of a telephone. Also clock type indicators in which the
numbers are indicated by a hand moving round a dial.
(3) Office indicators, for example, those used to indicate
whether the occupant of a particular office is free or
not...
(4) Lift indicators. These indicate, on an illuminated
board, where the lift is and whether it is going up or
down. etc.
Therefore, only those LCDs which are limited by design and
function to that of "signaling," are classifiable in heading 8531,
HTSUS. In HQ 952246, dated November 10, 1992 (citing HQ 951288,
dated July 7, 1992), we held that the Epson EA-D16125AR-S (2 lines
of 16 characters) is restricted by its limited operational
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capabilities to that of signaling functions, and is classifiable
under subheading 8531.20.00, HTSUS.
E.M. Chemicals v. United States, Appeal No. 90-1141, Cust.
Bul. Vol. 24, No. 51, (1990), 13 CIT 849, 728 F. Supp. 723 (1989),
held that under the TSUS, the actual liquid crystals themselves
were classifiable under item 685.70 (the predecessor provision to
heading 8531, HTSUS). However, there has been a significant change
in the relevant tariff provisions under the HTSUS. In fact,
heading 9013, HTSUS, which provides for LCDs specifically, is a new
provision under the HTSUS. Furthermore, LCDs have been
technologically developed for a myriad of uses, many of which
cannot be said to be for "signaling."
In HQ 952246 we held that due to the expansive character
capabilities of the EG-2401S-ER-1 (1 line with 64 characters) and
EG-7500B-NS-1 (1 line with 200 characters) a principal use of
signaling cannot be supported. However, due to the submission of
supplemental information regarding the principal use of LCDs, we
are now of the opinion that LCDs having 80 or less characters are
restricted to signaling functions by virtue of their operational
limitations. Furthermore, they are complete, finished indicator
panels that are ready to be plugged into other machines.
Therefore, the EG-2401S-ER-1 (1 line with 64 characters) is
classifiable in subheading 8531.20.00, HTSUS.
We agree that there is a class of LCDs that are principally
used for ADP display. Automatic Data Processing machine LCD flat
panel displays (laptop and notebook computer displays) typically
exhibit the following characteristics: pixel configuration (640 X
480), dot pitch (.27 to .30mm), thin profile, light weight, liquid
crystal material mix (150 to 200 milliseconds response time signal
to signal), and low power consumption (5V). The Epson EG7009N-NS
8834COS ADP display subassembly is a complete ADP Flat Panel
Display, missing only the exterior housing. Therefore, pursuant
to GRI 2(a), this model has the essential character of a finished
ADP display, classifiable under subheading 8471.92.30, HTSUS, which
provides for ADP display units without cathode ray tubes.
Previously, we issued NY 843928, dated August 7, 1989, to you
in which Customs classified the Epson computer display module
(projectable LCD) model ECM-A0360 under subheading 8473.30.40,
HTSUS, which provides for parts of ADP machines not incorporating
cathode ray tubes. However, we have received supplemental
information that this ADP display subassembly is a complete ADP
Flat Panel Display, missing only the exterior housing. Therefore,
pursuant to the above analysis, we now consider this module to
impart the essential character of an ADP display without a cathode
ray tube. Therefore, it is classifiable in subheading 8471.92.30,
HTSUS, which provides for ADP displays without cathode ray tubes.
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We also issued NY 849402, dated February 12, 1990, to you in
which Customs classified the Epson "Magnabyte Computer Projection
System" (projectable computer display module LCD) model ECM-A0275
under subheading 8473.30.40, HTSUS, which provides for parts of ADP
machines not incorporating cathode ray tubes. However, we now also
have information that this ADP display subassembly is a complete
ADP Flat Panel Display, missing only the exterior housing.
Therefore, we consider this module to impart the essential
character of an ADP display without a cathode ray tube.
Consequently, it is classifiable in subheading 8471.92.30, HTSUS,
which provides for ADP displays without cathode ray tubes.
Section XVI, Legal Note 1(m) states that: "[t]his section does
not cover: [a]rticles of chapter 90." Heading 9013, HTSUS,
provides for: "[l]iquid crystal devices not constituting articles
provided for more specifically in other headings." Therefore, if
the Epson LCDs are provided for more specifically in another
heading, they would not be classifiable in heading 9013, HTSUS.
You have requested classification of "LCD Panels" which
consist of a twisted nematic liquid crystal cell sandwiched between
two polarizers in which light enters the first polarizer in one
plane, is twisted and passes through the second polarizer resulting
in a light colored background. When one of the transparent pixels
is activated, the twist is inhibited and the second polarizer
blocks the light creating a dark pixel. In their imported
condition, these LCD sandwiches do not contain a printed circuit
board, row and column drivers, or integrated circuits of any kind.
However, at importation they do have either rubber connectors, heat
seal connectors, or dual-in-line (DIL) pin connectors.
Heading 9013, HTSUS, provides for: "[l]iquid crystal devices
not constituting articles provided for more specifically in other
headings. The ENs to heading 9013, HTSUS, page 1478, state:
(1) Liquid crystal devices consisting of a liquid crystal
layer sandwiched between two sheets or plates of glass
or plastics, whether or not fitted with electrical
connections, presented in the piece or cut to special
shapes and not constituting articles described more
specifically in other headings of the Nomenclature.
(Emphasis added).
Customs has determined that the instant LCD glass sandwich is
a component part of an ADP display. However, the instant
importation merely consists of the LCD glass sandwich with
electrical connections. It is imported without all of the
additional components usually necessary to complete an ADP flat
panel display, such as; a printed circuit board (which activates
the row and column drivers), row and column drivers (which activate
the LCD pixels), and integrated circuits. Therefore, the instant
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glass sandwich is determined not to impart the essential character
of a finished ADP display. See, for example, HQ 086929, dated
January 31, 1991, which held that a cathode ray tube for an ADP
output unit was not classifiable as an unfinished ADP output
device, and was instead classifiable in subheading 8540.30.00,
HTSUS, which provides for other cathode-ray tubes.
Subheading 8473.30.40, HTSUS, provides for: "[p]arts and
accessories...suitable for use solely or principally with machines
of headings 8469 to 8472: [p]arts and accessories of the machines
of heading 8471: [n]ot incorporating a cathode ray tube." However,
heading 9013 specifically provides for: "[l]iquid crystal devices
not constituting articles provided for more specifically in other
headings." It is Customs position that heading 9013, HTSUS, is
more specific than heading 8473, HTSUS.
Therefore, the Epson "LCD Panels" glass sandwich with
electrical connections is classifiable in subheading 9013.80.90,
HTSUS. See HQ 951609, dated October 20, 1992, for a decision
regarding ADP LCD glass sandwiches, which were not classifiable as
unfinished ADP output units because they lacked the essential
character of the finished display. For other rulings regarding
LCDs, see HQ 952360, and HQ 951288, dated July 7, 1992.
Therefore, unless a principal use for "signaling" (heading
8531, HTSUS) or for ADP display (heading 8471, HTSUS) can be
established satisfactorily either by design limitation or other
reliable means, LCD displays are classifiable in subheading
9013.80.60, HTSUS, which provides for: "[l]iquid crystal devices
not constituting articles provided for more specifically in other
headings: [o]ther devices, appliances and instruments: [o]ther."
The Test and Control Module (TCM) and the Epson Custom Module
(ECM) contain row and column drivers and are utilized in numerous
applications, such as point of sale terminals, medical equipment,
etc. Therefore, since there appears to be no principal use and no
design limitations, the TCM and ECM are classifiable in subheading
9013.80.60, HTSUS. We continue to disagree with your assertion
that we should classify these models as ADP displays absent a
showing of principal use as such.
We also disagree with your assertion that the EG (graphics
displays) series LCD modules are classifiable under the provision
for ADP displays, absent a showing of sole or principal use of each
model for ADP display.
HOLDING:
The Epson "LCD Panels" glass sandwich with electrical
connections is classifiable in subheading 9013.80.60, HTSUS, which
provides for: "[l]iquid crystal devices not constituting articles
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provided for more specifically in other headings: [o]ther devices,
appliances and instruments: [o]ther."
The Epson EA-D16125AR-S (2 lines of 16 characters) and the EG-
2401S-ER-1 (1 line with 64 characters), are restricted by their
limited operational capabilities to that of signaling functions,
therefore, they are classifiable in subheading 8531.20.00, HTSUS,
which provides for: "[e]lectric sound or visual signaling apparatus
(for example, bells, sirens, indicator panels...: [i]ndicator
panels incorporating liquid crystal devices (LCD's) or light
emitting diodes (LED's)."
Due to the expansive character capabilities of the EG-7500B-
NS-1 (1 line with 200 characters), a principal use of signaling is
not found. Therefore, they are classifiable in subheading
9013.80.60, HTSUS, which provides for: "[l]iquid crystal devices
not constituting articles provided for more specifically in other
headings: [o]ther devices, appliances and instruments: [o]ther."
The Epson EG7009N-NS 8834COS ADP display subassembly is a
complete ADP Flat Panel Display, missing only the exterior housing.
Therefore, pursuant to GRI 2(a), this model has the essential
character of a finished ADP display, and is classifiable under
subheading 8471.92.30, HTSUS, which provides for ADP display units
without cathode ray tubes.
The Test and Control Module (TCM) and the Epson Custom Module
(ECM) contain row and column drivers and are utilized in numerous
applications, such as point of sale terminals, and medical
equipment. Therefore, since there appears to be no principal use
and there are no design limitations, the TCM and ECM are
classifiable in subheading 9013.80.60, HTSUS.
EFFECT ON OTHER RULINGS:
In HQ 952246, dated November 10, we held that, due to the
expansive character capabilities of the EG-2401S-ER-1 (1 line with
64 characters), a principal use of signalling was not present.
However, due to the submission of supplemental information
regarding the principal use of LCDs, we are now of the opinion that
LCDs having 80 or less characters are restricted to signaling
functions by virtue of their operational limitations. Therefore,
the EG-2401S-ER-1 (1 line with 64 characters) is classifiable in
subheading 8531.20.00, HTSUS.
In HQ 952246, we classified LCDs designed for ADP display
under subheading 8471.92.80, HTSUS, which provides for ADP output
units suitable for physical incorporation. However, upon further
analysis, the correct classification is under subheading
8471.92.30, HTSUS, which provides for ADP display units without
cathode ray tubes.
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In NY 843928, dated August 7, 1989, Customs classified the
Epson computer display module (projectable LCD) model ECM-A0360
under subheading 8473.30.40, HTSUS, which provides for parts of ADP
machines not incorporating cathode ray tubes. However, we now
consider this module to impart the essential character of an ADP
display without a cathode ray tube. Therefore, it is classifiable
in subheading 8471.92.30, HTSUS, which provides for ADP displays
without cathode ray tubes.
In NY 849402, dated February 12, 1990, Customs classified the
Epson "Magnabyte Computer Projection System" (projectable computer
display module LCD) model ECM-A0275 under subheading 8473.30.40,
HTSUS, which provides for parts of ADP machines not incorporating
cathode ray tubes. However, we now consider this module to impart
the essential character of an ADP display without a cathode ray
tube. Therefore, it is classifiable in subheading 8471.92.30,
HTSUS, which provides for ADP displays without cathode ray tubes.
These rulings are modified under authority of section
177.9(d), Customs Regulations (19 CFR 177.9(d).
Sincerely,
John Durant, Director