CLA-2 CO:R:C:M 955273 KCC
District Director
U.S. Customs Service
Key Tower Building #2200
1000 2nd Avenue
Seattle, Washington 98104-1049
RE: Protest No. 3001-93-100445; M95 Fax Option Kit; stuffed
printed circuit board; cable; screws; guide; labels; software;
GRI 3(b); set; Note 6, Chapter 85; EN 85.17; apparatus; The
Deseret Co., v. United States; NY 842533; 8473.30.40;
Additional U.S. Rule of Interpretation 1(c); parts and
accessories; 8471.99.60; HRL 951331; HRL 952659
Dear Sir:
This is in response to the Application for Further Review of
Protest No. 3001-93-100445, which pertains to the tariff
classification of the M95 Fax Option Kit under the Harmonized
Tariff Schedule of the United States (HTSUS).
FACTS:
The protestant states that the M95 Fax Option Kit (fax option
kit) is imported in a condition ready for retail sale and consists
of a stuffed printed circuit board, a cable, screws, an
installation guide, a fax label and fax logo, and a floppy disk
containing software. The fax option kit is used in conjunction
with a personal computer (PC), i.e., Apple Macintosh with system
6.05 or higher or a PC with DOS 3.0 or higher, and a NEC Model 95
Silentwriter printer. The stuffed printed circuit board is
installed in the NEC Silentwriter printer using the cables and
screws included in the kit. The software containing the program
instructions is loaded into the PC to control the function of the
stuffed printed circuit board installed in the printer.
To use the fax option capability after installation, the
document to be faxed must be displayed on the PC monitor screen.
With the document thus resident in the operational RAM memory, the
menu asks if the user wants the document printed or faxed. If the
fax option is chosen, the document is sent from the computer to the
printer and then out to the receiving party.
The entries of the fax option kit were liquidated starting on
April 2, 1993, under subheading 8517.82.00, HTSUS, as other
telegraphic apparatus. In a protest timely filed on June 28, 1993,
the protestant contends that the fax option kit is classified under
subheading 8473.30.40, HTSUS, as parts and accessories of the
machines of heading 8471, not incorporating a cathode ray tube, or
alternatively under subheading 8471.99.60, HTSUS, as other units
suitable for physical incorporation into automatic data processing
machines or units thereof. The protestant contends that the fax
option kit is a set classified pursuant to GRI 3(b), HTSUS, with
the essential character of the set imparted by the stuffed printed
circuit board. Furthermore, the protestant notes that
classification of the software is excluded from classification with
the set pursuant to Note 6, Chapter 85, HTSUS, and is, therefore,
classified under subheading 8524.90.40, HTSUS, as other recorded
media.
The competing subheadings are:
8471.99.60 Automatic data processing machines and units
thereof; magnetic or optical readers, machines for
transcribing data onto data media in coded form and
machines for processing such data, not elsewhere
specified or included...Other...
Other...Other....Units suitable for physical
incorporation into automatic data processing
machines or units thereof.
8473.30.40 Parts and accessories (other than covers, carrying
cases and the like)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.
8517.82.00 Electrical apparatus for line telephony or
telegraphy, including such apparatus for carrier-
current line systems; parts thereof...Other
apparatus...Telegraphic....
ISSUE:
Is the M95 Fax Option Kit classified under subheading
8517.82.00, HTSUS, as other telegraphic apparatus or under
subheading 8473.30.40, HTSUS, as parts and accessories of the
machines of heading 8471, not incorporating a cathode ray tube, or
under subheading 8471.99.60, HTSUS, as other units suitable for
physical incorporation into automatic data processing machines or
units thereof?
LAW AND ANALYSIS:
The classification of merchandise under the HTSUS is governed
by the General Rules of Interpretation (GRI's). GRI 1, HTSUS,
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...."
As the protestant has noted, classification of the software
is excluded from classification with the fax option kit pursuant
to Note 6, Chapter 85, HTSUS, and is, therefore, classified under
subheading 8524.90.40, HTSUS, as other recorded media. The
principal component of the fax option kit is the stuffed printed
circuit board. The additional components, cable, screws,
installation guide, label, and logo are components necessary for
the installation and functioning of the stuffed printed circuit
board. Therefore, they are classified with the stuffed printed
circuit board pursuant to GRI 1, HTSUS.
We are of the opinion that the stuffed printed circuit board
is classified under subheading 8517.82.00, HTSUS, as other
telegraphic apparatus. In understanding the language of the HTSUS,
the Harmonized Commodity Description and Coding System ENs may be
utilized. The ENs, although not dispositive, are to be used to
determine the proper interpretation of the HTSUS. 54 Fed. Reg.
35127, 35128 (August 23, 1989). EN 85.17 (pgs. 1360-1363), states
that:
The term "electrical apparatus for line telephony or line
telegraphy" means apparatus for the transmission between two
points of speech or other sounds (or of symbols representing
written messages, images or other data), by variation of an
electric current or of an optical wave flowing in a metallic
or dielectric (copper, optical fibres, combination cable,
etc.) circuit connecting the transmitting station to the
receiving station.
EN 85.17 (II) TELEGRAPHIC APPARATUS states that telegraphic
apparatus:
...is essentially designed for converting texts or images into
appropriate electrical impulses, for transmitting those
impulses, and at the receiving end, receiving these impulses
and converting them either into conventional symbols or
indications representing the text, or into the text or image
itself.
The principal function of the stuffed printed circuit board
is the transmission of data between two points. The protestant
contends that subheading 8517.82.00, HTSUS, provides for complete
apparatus, not parts which are incomplete and inoperative in and
of themselves. This is incorrect. The term "apparatus" has been
defined by the courts as a combination of articles and materials
which are intended, adapted, and necessary for the accomplishment
of some purpose. The Deseret Co., v. United States, 10 CIT 609,
(1986). The stuffed printed circuit board is an apparatus; it is
an article that is intended, adapted and necessary for the
accomplishment of sending documents from one party to another.
Moreover, similar merchandise, i.e., modem boards which are add-
on boards for PCs, is classified under subheading 8517.40.10,
HTSUS, as modems, of a kind used with data processing machines of
heading 8471. See, New York Ruling (NY) 842533 dated June 23,
1989.
The protestant contends that the stuffed printed circuit board
is classified under subheading 8473.30.40, HTSUS, as parts and
accessories of the machines of heading 8471, not incorporating a
cathode ray tube. A provision for "parts" or "parts and
accessories" shall not prevail over a specific provision for such
part or accessory. See, Additional U.S. Rule of Interpretation
1(c), HTSUS. Therefore, as the stuffed printed circuit board is
specifically provided for under subheading 8517.82.00, HTSUS, it
is not classifiable under subheading 8473.30.40, HTSUS, as parts
and accessories of the machines of heading 8471, not incorporating
a cathode ray tube.
Alternatively, the protestant argues that the stuffed printed
circuit board is classified under subheading 8471.99.60, HTSUS, as
other units suitable for physical incorporation into automatic data
processing machines or units thereof. The protestant cites
Headquarters Ruling Letter (HRL) 951331 dated September 18, 1992,
as evidence of the classification of the stuffed printed circuit
boards under subheading 8471.99.60, HTSUS. HRL 951331 classified
Local Area Network (LAN) Interface Boards under subheading
8471.99.60, HTSUS. The LAN boards performed two major functions,
data transmission (heading 8517, HTSUS) and data processing
(heading 8471, HTSUS). HRL 951331 held that the data processing
function imparted the essential character to the LAN boards and not
the data transmission function. Therefore, HRL 951331 revoked
numerous rulings which classified the LAN boards pursuant to their
data transmission function under subheading 8517.82.00, HTSUS. It
should be noted that HRL 952659 modified the classification of HRL
951331 to subheading 8471.99.15, HTSUS.
The stuffed printed circuit board under consideration is not
similar to the LAN boards because they do not have data processing
capabilities. The stuffed printed circuit board's function is that
of data transmission. Therefore, it is properly classified under
subheading 8517.82.00, HTSUS, as other telegraphic apparatus.
HOLDING:
The M95 Fax Option Kit, excluding the software, is classified
under subheading 8517.82.00, HTSUS, as other telegraphic apparatus.
The software is classified under subheading 8524.90.40, HTSUS, as
other recorded media.
This protest should be DENIED. In accordance with Section
3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993,
Subject: Revised Protest Directive, this decision, together with
the Customs Form 19, should be mailed by your office to the
protestant no later than 60 days from the date of this letter.
Any reliquidation of the entry in accordance with the decision must
be accomplished prior to mailing of the decision. Sixty days from
the date of the decision 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 the public via the Diskette
Subscription Service, Lexis, Freedom of Information Act and other
public access channels.
Sincerely,
John Durant, Director