CLA-2 CO:R:C:M 955908 LTO
District Director
U.S. Customs Service
9 North Grand Avenue
Nogales, Arizona 85621
RE: Protest 2604-93-100052; Flexible circuit assemblies; HQs
955413, 957048; EN 85.34; section XVI, note 2; chapter 85,
note 4; headings 8536, 8544; item 676.54, TSUS; Hemscheidt
Corp. v. U.S.; Thomas Equip., Ltd. v. U.S.; 19 U.S.C.
1315(d)
Dear District Director:
The following is our decision regarding Protest 2604-93-
100052, which concerns the classification of flexible circuit
assemblies under the Harmonized Tariff Schedule of the United
States (HTSUS). The subject merchandise was entered between
March 19 through June 24, 1993, and the entries were liquidated
on August 6 and August 27, 1993. The protest was timely filed on
November 2, 1993.
FACTS:
The articles in question are flexible circuit assemblies (or
"flex" circuit assemblies), which permit transmission of an
electronic signal between the read/write head, central
electronics and external drive interface of a personal computer.
During the useful life of a computer, such electronic signals
will literally require millions of movements. The flexible
circuit assembly is particularly well suited to be repeatedly
bent during the computer's operation.
The flexible circuit assemblies consist of a flexible
circuit (tracings in a polyamide material) and electrical
connectors. Some assemblies also contain stiffeners (of metal,
plastic or polyamide material) and a variety of passive and/or
active components, including: ferrite chokes; light emitting
diodes (LEDs); resistors; PC card cages; auto lock jumpers; write
enable switches; encoder sensors; temperature sensors; diodes; - 2 -
speakers; wire jumper sets; and cartridge ink sensors. The
stiffeners, including those of polyamide material, are not added
to facilitate the connection of the assembly, but to provide
rigidity, strength or other geometric conformance to the
assemblies as is required by the particular application.
The flexible circuit assemblies were entered as parts of
automatic data processing (ADP) machines under subheading
8473.30.40, HTSUS (free of duty). The assemblies were classified
upon liquidation as electrical apparatus for making connections
to or in electric circuits under subheading 8536.90.00, HTSUS
(4.8% ad valorem), or as other electric conductors fitted with
connectors under subheading 8544.41.00, HTSUS (4.8% ad valorem).
ISSUE:
Whether the flexible circuit assemblies are classifiable as
parts of ADP machines under subheading 8473.30.40, 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 that "for legal purposes, classification
shall be determined according to the terms of the headings and
any relative section or chapter notes . . . ."
The Harmonized Commodity Description and Coding System
Explanatory Notes (ENs) constitute the Customs Co-operation
Council's official interpretation of the Harmonized System.
While not legally binding, and therefore not dispositive, the ENs
provide a commentary on the scope of each heading of the
Harmonized System, and are generally indicative of the proper
interpretation of these headings. See T.D. 89-80, 54 Fed. Reg.
35127, 35128 (August 23, 1989).
The protestant contends that the assemblies in question are
classifiable as parts of ADP machines under heading 8473, HTSUS.
Note 2 to section XVI, HTSUS, governs the classification of parts
in chapters 84 and 85. Note 2(a) provides as follows:
(a) Parts which are goods included in any of the headings of chapters 84 and 85 (other than 8485
and 8548) are in all cases to be classified in
their respective headings.
Accordingly, if the assemblies are goods included in any
chapter 84 or 85 heading, they cannot be classified as parts
under heading 8473, HTSUS.
Heading 8534, HTSUS, provides for printed circuits. Note 4
to chapter 85 states that for the purposes of heading 8534, - 3 -
HTSUS, "'printed circuits' are circuits obtained by forming on an
insulated base, by any printing process (for example, embossing,
plating-up, etching) or by the 'film circuit' technique,
conductor elements, contacts or other printed components (for
example inductances, resistors, capacitors) alone or
interconnected according to a pre-established pattern, other than
elements which can produce, rectify, modulate or amplify an
electrical signal (for example, semiconductor elements)." The
note further states that "[t]he term 'printed circuits' does not
cover circuits combined with elements other than those obtained
during the printing process. Printed circuits may, however, be
fitted with non-printed connecting elements." See also EN 85.34,
pg. 1386.
In HQ 955413, dated May 18, 1994, Customs considered the
classification of several flexible circuit assemblies. We
determined that those assemblies consisting of a flexible printed
circuit fitted with non-printed electric connections at one end,
a strip of stiffener (designed to facilitate connection), an
adhesive strip, but no additional non-printed elements, were
classifiable under heading 8534, HTSUS. However, those
assemblies combined with thermistors or ferrite beads, elements
not obtained during the printing process, could not be classified
under heading 8534, HTSUS. These assemblies were then classified
as parts of ADP machines under heading 8473, HTSUS. Furthermore,
we rejected the claim that these assemblies were classifiable
under heading 8536, HTSUS, which provides for electrical
apparatus for making connections to or in electrical circuits,
and heading 8544, HTSUS, which provides for insulated wire, cable
and other insulated electrical conductors.
In HQ 957048, dated January 10, 1995, Customs considered the
classification of a flexible circuit assembly consisting of a
flexible circuit, strip of stiffener, three connectors, plastic
support and two switches soldered onto the flexible circuit. We
held that, as the switches and plastic support were not obtained
during the printing process, the assembly could not be classified
as a printed circuit under heading 8534, HTSUS.
The following assemblies in question, which are fitted with
non-printed electric connections, but no additional non-printed
elements, meet the definition for "printed circuits," and are
classifiable under heading 8534, HTSUS: 1DIGC127H, 1MAXC129D,
1QMTCK22P, 1SGTAS86E, 5SGTAS80B and 1HALA547ETN. However, the
remainder of the assemblies, which are solely used with the
automatic data processing (ADP) machines of heading 8471, HTSUS,
include non-printed components (other than connecting elements),
such as, ferrite chokes, LEDs, resistors, PC card cages, auto
lock jumpers, write enable switches, encoder sensors, temperature
- 4 -
sensors, diodes, speakers, wire jumper sets, cartridge ink
sensors and stiffeners (of metal, plastic or polyamide material).
Thus, these assemblies are classifiable under heading 8473,
HTSUS.
Finally, we note that the protestant contends that there is
a uniform and established practice of classifying flexible
circuit assemblies as parts of ADP machines (item 676.54, Tariff
Schedules of the United States (TSUS); heading 8473, HTSUS)
(citing Hemscheidt Corp. v. United States, 858 F. Supp. 223 (July
8, 1994). Hemscheidt concerned a TSUS provision (item 664.08)
and HTSUS provisions (headings 8430 and 8431) in which the Court
found, when comparing the language of the provisions,
"significant similarities." See also Thomas Equipment Ltd. v.
United States, Slip Op. 95-29 (February 28, 1995) (wherein the
court stated that 19 U.S.C. 1315(d) would require Customs to
publish notice in the Federal Register where "the HTSUS contained
a provision with exactly the same terms and duty rate [as the
TSUS provision] . . . [and] both the legislative history and
explanatory notes for the HTSUS provision lacked any evidence
indicating an intent to deviate from the UEP developed under the
TSUS.")
As stated above, many of the flexible circuit assemblies in
question have, in fact, been classified under heading 8473,
HTSUS. However, several assemblies met the definition of
"printed circuits" found in note 4 to chapter 85, and therefore,
must, according to note 2(a) to section XVI, be classified under
heading 8534, HTSUS. "Printed circuits" were not specifically
named in the legal text of the TSUS, nor were they defined under
the TSUS. Thus, although an appeal from the Hemscheidt decision
is still pending before the United States Court of Appeals for
the Federal Circuit (No. 94-1511, docketed September 22, 1994),
it is our opinion that the holding in Hemscheidt, as well as the
holding in Thomas Equipment, is inapplicable to the case at hand.
HOLDING:
The following flexible circuit assemblies are classifiable
under subheading 8534.00.00, HTSUS (4.8% ad valorem), which
provides for printed circuits: 1DIGC127H, 1MAXC129D, 1QMTCK22P,
1SGTAS86E, 5SGTAS80B and 1HALA547ETN.
The remainder of the assemblies are classifiable under
subheading 8473.30.40, HTSUS (free), which provides for parts of
ADP machines, other than for power supplies.
The protest should be DENIED with regard to the assemblies
classified under heading 8534, HTSUS, since the rate of duty
under the classification indicated above is the same as the
liquidated rate, but should be GRANTED with regard to the
assemblies classified under heading 8473, HTSUS. - 5 -
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 the 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, Freedom of Information Act and other public
access channels.
Sincerely,
John Durant, Director
Commercial Rulings Division