HQ 953047
NOVEMBER 9 1993
CLA-2:CO:R:C:M 953047 JAS
District Director of Customs
610 South Canal Street
Chicago, Il 60607
RE: Step-and-Repeat Machine; Imposition Plate Making Machine;
Computer-Based Graphic Arts Machine, Machine for Composing
and Producing Printing Plates; Printing Plate Imaging
Machine, Heading 8442; Machine for Producing Images on
Light-Sensitive Plates, Photographic Apparatus, Heading
9010; Section XVI, Note 1(m); HQ 088649, HQ 950665,
HQ 951228; Internal Advice 75/92
Dear Sir:
Your memorandum of October 7, 1992 (MAN-1-02-CO:CH CT 309
ML), forwarded a submission, dated September 30, 1992, from
counsel constituting a request for internal advice on behalf of
Misomex North America Inc. The issue is the proper
classification of step-and-repeat machines from Sweden. In a
letter dated July 8, 1993, summarizing a meeting held in our
office on June 22, counsel withdrew from consideration the issue
of parts of these machines.
FACTS:
The machines in issue here are the Misomex models 405, 500,
601, 602, 603, 726, 800, 803 and SR-70. These machines compose
images of text and pictorial material and impose them onto light-
sensitive printing plates. These are steps in the process of
photoimposition that occur prior to running the plates on a
printing press.
In operation, these machines place a piece of film
containing textual and/or pictorial images previously produced in
a photocomposing process, i.e., by a photographic camera, into a
chase or frame. In accordance with instructions from a computer
program the machines expose specific portions of an ultraviolet
light-sensitive printing plate to the film. By exposing the film - 2 -
to the light source a chemical reaction occurs with the light-
sensitive emulsion on the plate to impose the film's images onto
one or more precise locations on the plate. These machines can
horizontally or vertically position or "step" individual or
combinations of film images, and "repeat" the image or images on
different parts of the plate. Step-and-repeat technology enables
the entire surface of a plate to be utilized. The resulting
exposed plates are then developed, washed, gummed, and dried in a
separate machine called a plate processor. This readies the
plates for use in a printing press to mass-produce letterheads,
cards, labels, books, advertisements, newspaper inserts, etc.
The step and repeat machines were entered under the
provision for phototypesetting and composing machines, in
subheading 8442.10.00, Harmonized Tariff Schedules of the United
States (HTSUS). You rejected this classification on the basis
that the described process of transferring previously set copy
from a transparency to a photosensitized plate is not one of
"setting" or "composing" type. On the belief that this is
essentially a photographic process, you propose to liquidate the
entries under subheading 9010.20.60, HTSUS, as other apparatus
and equipment for photographic laboratories.
The provisions under consideration are as follows:
8442.10.00 Phototypesetting and composing machines
...Free
* * * * *
9010.20.10 Other apparatus and equipment for
photographic laboratories: Contact
printers...2.2 percent
* * * * *
9010.20.60 Other apparatus and equipment for
photographic laboratories: Other...
3.7 percent
ISSUE:
Whether step-and-repeat machines, as described, are
apparatus and equipment of heading 9010.
LAW AND ANALYSIS:
Merchandise is classifiable under the Harmonized Tariff
Schedule of the United States (HTSUS) in accordance with the
General Rules of Interpretation (GRIs). GRI 1 states in part
that for legal purposes, classification shall be determined
according to the terms of the headings and any relative section - 3 -
or chapter notes, and provided the headings or notes do not
require otherwise, according to GRIs 2 through 6.
The Harmonized Commodity Description And Coding System
Explanatory Notes (ENs) constitute the Customs Cooperation
Council's official interpretation of the Harmonized System.
While not legally binding on the contracting parties, and
therefore not dispositive, the ENs provide a commentary on the
scope of each heading of the Harmonized System and are thus
useful in ascertaining the classification of merchandise under
the System. Customs believes the notes should always be
consulted. See T.D. 89-80.
In its original submission to you, dated September 30, 1992,
counsel has advanced a number of arguments in support of the
heading 8442 classification and against the heading 9010
classification. Further discussions and additional arguments
made at a meeting held in our office on June 22, 1993, were
summarized in a later submission to us, dated July 8, 1993.
Counsel's arguments are briefly summarized as follows: (1)
heading 8442 is more specific than heading 9010 because the
principal function of step-and-repeat machines is to organize
various graphics input onto a printing plate, which is a
phototypesetting or composing function; (2) the common and
commercial meaning of the term "phototypesetting and composing"
include step-and-repeat machines; (3) historically, the Customs
Court has classified step and repeat machines in the HTSUS'
predecessor tariff code, the Tariff Schedules of the United
States (TSUS), in provisions for typesetting machines; (4)
rulings under the HTSUS classify substantially similar machines
and apparatus in heading 8442; (5) relevant Explanatory Notes
support classification of step and repeat machines in heading
8442; (6) TSUS/HTSUS cross reference tables refer step and repeat
machines classified under the TSUS in provisions for printing
machinery and/or typesetting machines to equivalent HTSUS
provisions; and, (7) conversion to the HTSUS was intended to be
revenue-neutral to the fullest extent possible.
We must emphasize that full and careful consideration has
been given to all of counsel's written arguments, as well as to
the views expressed in several telephone conversations with my
staff. However, we will discuss only those arguments we find to
be most relevant to the issues that control classification in
this case. Apple Computer, Inc. v. United States, Slip Op. 90-
111 (1990).
The majority of counsel's arguments are in support of the
heading 8442 classification. However, articles of chapter 90 are
precluded from classification in chapter 84. See Section XVI,
Note 1(m), HTSUS. Therefore, if the step-and-repeat machines in
issue are apparatus and equipment of heading 9010 or are goods of - 4 -
any other heading in chapter 90, it is clear they cannot be
classified in heading 8442.
In its first argument, counsel observes that the provision
relating to functional units (note 4 to Section XVI) applies to
goods of chapter 90. See Chapter 90, Note 3, HTSUS. He
maintains that step-and-repeat machines perform a photographic
function of heading 9010 and a phototypesetting and composing
function of heading 8442. Counsel further maintains that the
Customs Court determined that step-and-repeat machines perform
the "function" of setting type by means of photocomposing.
Consolidated International Equipment & Supply Co. v. United
States, C.D. 3901 (1969). This is evidence of their principal
function which, he concludes, requires classification in heading
8442. This makes Section XVI, Note 1(m) inoperative. We believe
that counsel's argument confuses "function" with "purpose." The
purpose of step-and-repeat machines is to prepare printing plates
using a photomechanical process. However, this purpose is
achieved by the function of exposing a coated, light-sensitive
plate to a negative flat in a vacuum frame. This is clearly a
photographic process.
Counsel cites to judicial and administrative decisions on
step-and-repeat machines under the TSUS to support the heading
8442 classification. The Congress has acknowledged that such
decisions can be instructive in interpreting the HTSUS, provided
the nomenclature remains unchanged and no dissimilar
interpretation is required by the text of the HTSUS. H. Rep. No.
100-576, 100th. Cong., 2d. Sess. 548 (1988), pp. 549,550. This
is a clear indication that the headings, and the section and
chapter notes are at all times paramount in classifying goods
under the HTSUS.
Counsel cites three (3) rulings classifying typesetting and
imaging machinery in heading 8442. The descriptions in HQ
086122, dated January 17, 1991, and HQ 089808, dated October 24,
1991, indicate that while the apparatus in those cases performed
a function appropriate to heading 8442, additional or different
components from the ones present here may have been included. We
are unable to compare the apparatus in HQ 950241, dated November
21, 1991, with the goods here because that decision simply
describes phototypesetting "scanners" with "analyze" and "expose"
units. Of greater importance, none of the decisions discusses
heading 9010 or any of the legal notes that may govern
classification here.
The courts have sanctioned the Explanatory Notes as useful
guides to understanding and interpreting provisions of the HTSUS.
We do not agree that the notes support classification of these
machines in heading 8442. Relevant ENs on heading 8442 state, at
p. 1237, "The heading covers only phototype-setting or composing
machines which actually set type even if the type is photographed - 5 -
after it has been set (Emphasis original). The notes continue by
stating the heading excludes photographic contact printers and
similar photographic apparatus for preparing printing plates or
cylinders. The notes refer these goods to chapter 90. Step-
and-repeat machines do not set or compose type as indicated in
the notes. The type has already been composed on the
transparencies before they reach the step-and-repeat machines.
These machines prepare printing plates in a manner described in
the notes by arranging film transparencies in the desired order
and utilizing a photographic process to transfer the film's
images to the plates.
Heading 9010 is clearly a provision governed by "use."
Counsel argues that step-and-repeats belong to a class or kind of
machine principally used in printing facilities and trade shops
in connection with printing press operations, and not in
photographic laboratories. Where tariff terms are not defined in
the statute, the common and commercial meaning of those terms
shall prevail where no contrary legislative intent is indicated.
Counsel maintains that for purposes of heading 9010, it is
improper to examine the common meaning of the terms
"photographic" and "laboratory" in the disjunctive; rather, it is
the meaning of the expression "photographic laboratories" that
must be examined.
We are aware of no lexicographic authority that defines the
expression "photographic laboratory." Counsel has presented an
array of technical literature purporting to establish that step-
and-repeat technology is utilized by lithographers, platemakers,
graphic designers, and by other segments of the printing
industry, rather than by or in photographic laboratories.
Initially, heading 9010 is broader in scope than counsel
contends. The heading encompasses, among other things, apparatus
for the projection of circuit patterns on sensitized
semiconductor materials. This is specialized apparatus unique to
the semiconductor industry and is not commonly found in
"photographic" laboratories; rather, it is apparatus that
ulilizes or is based on "photographic" principles. The two
rulings counsel cites do not, as he contends, support a narrow
construction of the term. HQ 088024, dated January 3, 1991, and
HQ 950062, dated October 30, 1991, simply concluded that the
apparatus under consideration was "not utilized by" or "for use
in" photographic laboratories. Neither decision examined the
common meaning of the expression "photographic laboratories."
However, in HQ 088649 and HQ 083123, dated May 28, 1991, and
December 18, 1989, respectively, Customs ruled that the terms
"photography" and "laboratory" are to be given broad and liberal
interpretations.
Where words have both a broad and a narrow common meaning,
it is proper to refer to the legislative history, administrative
practice, sections related to those in which the terms appear, - 6 -
and other extrinsic aids. F.W. Myers, Inc. v. United States, 12
CIT 566, Slip Op. 88-78 (1988), and related cases. The heading
9010 ENs are not helpful in resolving the issue. While not
necessarily constituting a longstanding administrative practice,
from May of 1991 through June of 1992 Customs has issued three
(3) administrative rulings, HQ 088649, HQ 950665, and HQ 951228,
that discuss the competing provisions in issue here as well as
the relevant legal notes. They conclude that step-and-repeat
machines are classifiable in heading 9010. Moreover, in
different tariff provisions where it appears, the term
"photographic" has been given a similarly broad interpretation.
HQ 088649 and HQ 950301.
We are satisfied that there is sufficient basis to regard
step-and-repeat machines as belonging to a class or kind of
apparatus principally used in environs that can reasonably be
regarded as "photographic laboratories" for tariff purposes.
HOLDING:
Under the authority of GRI 1, the Misomex step-and-repeat
machine models 405, 500, 601, 602, 603, 726, 800, 803 and
SR-70 in issue here are provided for in heading 9010.
There is some indication that step-and-repeat machines
function like or are akin to platemaking apparatus which perform
a contact printing function appropriate to goods of subheading
9010.20.10. This is because both utilize a vacuum and light
source in which the vacuum exhausts the air pressure under the
plate to insure positive contact with the frame. This form of
imaging is believed to be simply a form of contact printing, the
only major difference being that platemakers image only once
while step-and-repeat machines repeat the imaging. We can only
conclude that the evidence of record is not sufficient at this
time to permit a proper assessment of this argument. For this
reason, the Misomex step-and-repeat machine models in issue are
classifiable in subheading 9010.20.60, HTSUS, as other apparatus
and equipment for photographic laboratories.
You should mail this decision to the internal advice
applicant, through counsel, no later than 60 days from the date
of this letter. On that date the Office of Regulations and
Rulings will take steps to make the decision available to Customs
personnel via the Customs Rulings Module in ACS and to the public
via the Diskette Subscription Service, Lexis, the Freedom of
Information Act, and other public access channels.
Sincerely,
John Durant, Director
Commercial Rulings Division