CLA-2 R:C:M 957287 RFA
Ms. Lisa Cortes MS 1-42
AST Research Inc.
16215 Alton Parkway
Irvine, CA 92718
RE: Notebook Computers with CPU chip and Non-operational Flash
BIOS chip and without keyboard and hard drive; Legal Note
5(A)(a) to Chapter 84; HQs 957524, 957178, 951443, 950762,
950221, 953043
Dear Ms. Cortes:
This is in response to your letter dated October 31, 1994,
concerning the tariff classification of notebook computers with
CPU chip and non-operational flash BIOS chip and without a
keyboard and a hard drive under the Harmonized Tariff Schedule of
the United States (HTSUS). In preparing this ruling, we also
considered the information provided with your letter of April 7,
1995.
FACTS:
The Ascentia 910 series notebook computer will contain the
following components: a flat panel display; floppy disk drive;
power supply and the main logic board (motherboard) with the
central processing unit (CPU) chip and a non-operational flash
BIOS chip. The Ascentia 910 series notebook computer is entered
assembled, missing the following components: keyboard, hard
drive, and software. After importation, hard drives and
keyboards will be installed into the notebook computer. To
install the BIOS for the first time, the notebook computer is
turned on and the BIOS chip will initialize and check the memory
of the notebook computer. At this stage, the end-user will
insert a floppy disk into the disk drive and download the current
version of the BIOS instructions.
ISSUE:
Whether a notebook computer with CPU chip and non-operational flash BIOS chip and without a keyboard and a hard
drive is classifiable as an unfinished ADP machine or as a part
of an ADP machine under the HTSUS?
LAW AND ANALYSIS:
Classification of merchandise under the HTSUS is in
accordance with the General Rules of Interpretation (GRI's). GRI
1 provides that classification shall be determined according to
the terms of the headings and any relative section or chapter
notes.
To be classified as an ADP machine, merchandise must meet
the criteria in Legal Note 5(A)(a) to Chapter 84, HTSUS, which
provides as follows:
For purposes of heading 8471, the expression "automatic
data processing machines" means:
(a) Digital machines, capable of (1) storing the
processing program or programs and at least the
data immediately necessary for execution of the
program; (2) being freely programmed in accordance
with the requirements of the user; (3) performing
arithmetical computations specified by the user;
and, (4) executing, without human intervention, a
processing program which requires them to modify
their execution, by logical decision during the
processing run. . . .
The definitions for the terms "motherboard" and "ROM BIOS"
can be found in The Computer Glossary, Sixth Edition. The term
"motherboard" is defined as:
Main printed circuit board in an electronic device
which contains sockets that accept additional boards.
In a personal computer, the motherboard contains the
bus, CPU and coprocessor sockets, memory sockets,
keyboard controller and supporting chips.
Chips that control the video display, serial and
parallel ports, mouse and disk drives may or may not be
present on the motherboard. If not, they are
independent controllers that are plugged into an
expansion slot on the motherboard.
The term "ROM BIOS" is defined as:
Instructions contained in a ROM chip that activate
the peripheral devices in a PC. It includes routines
for the keyboard, screen, disk, parallel and serial
port and for internal services such as time and date.
It accepts requests from the device drivers in the
operating system as well as from application programs.
It also contains autostart functions that test the
system on startup and prepare the computer for
operation. It searches for other BIOS's on the plug-in
boards and sets up pointers (interrupt vectors) in
memory to access BIOS routines. It loads the operating
system and passes control to it.
In HQ 957524, dated March 28, 1995, Customs determined the
configurations of two notebook ADP machine subassemblies with
liquid crystal displays. The first configuration is comprised of
the notebook ADP machine without the BIOS ROM chip. The second
configuration is comprised of the notebook ADP machine without
the ROM BIOS chip, hard drive unit, and floppy drive unit. In
that ruling, Customs stated:
In HQ 950762, dated February 20, 1992, a CPU
motherboard with an 80286 microprocessor, two 64k
EPROMS, and a direct memory access controller was
classified as a finished digital processing unit under
heading 8471, HTSUS. In the ruling, it was stated that
"[t]he subject CPU board satisfies this description
[note 5(A)(a), chapter 84, HTSUS] of an ADP machine.
The 80286 microprocessor and EPROMS enable the board to
perform these functions."
Unlike the motherboard in HQ 950762, the subject
subassemblies [in HQ 957524] do not contain the BIOS
ROM chip. Therefore they cannot perform the functions
described in note 5(A)(a), chapter 84, HTSUS. The lack
of the BIOS ROM chip prevents the motherboard within
the subassemblies from performing input/output
functions with the keyboard. Logic and control
functions cannot be performed. Also, the processing
program cannot be executed without human intervention.
According to the information provided, the subject
merchandise contains a non-operational flash BIOS chip. After
the keyboard and hard drive is added, the laptop is capable of
receiving the BIOS code via a floppy diskette. Legal Note
5(A)(a) to chapter 84, HTSUS, only requires that the merchandise
is "capable" of performing the functions listed. Customs has
consistently held that the presence of the hardware and/or
firmware was a crucial factor in determining whether or not the
terms of Legal Note 5(A)(a) to chapter 84, HTSUS, have been met.
See HQ 957524; HQ 957178 (March 28, 1995); HQ 951443 (April 13,
1992); HQ 950762 (February 20, 1992); HQ 950221 (November 22,
1991). We conclude that the subject merchandise satisfies the
terms of heading 8471, HTSUS, because it is capable of executing,
without human intervention, a processing program which requires
them to modify their execution, by logical decision during the
processing run.
GRI 2(a) provides that: "[a]ny reference in a heading to an
article shall be taken to include a reference to that article
incomplete or unfinished, provided that, as presented, the
incomplete or unfinished article has the essential character of
the complete or finished article." The subject merchandise is
an incomplete or unfinished digital processing unit, needing only
the keyboard, hard drive, and software. In its condition as
imported, the Ascentia 910 notebook computer has the essential
character of a complete or finished digital processing unit
because it possesses the essential elements required for data
processing.
In HQ 953403, dated March 28, 1995, Customs determined that
a motherboard missing Stage 2 BIOS (lacking the ability to
accept, store and process data) could not be classified as an
unfinished or incomplete ADP machine. The basis for this
decision was the mistaken belief that the Stage 2 BIOS was
firmware (i.e., a programmed chip) and not software. Therefore,
we find that the rationale of HQ 953403 is incorrect and is not
applicable in this case.
HOLDING:
Under the authority of GRI 2(a), we find that the Ascentia
910 series notebook computer with a non-operational flash BIOS
chip is classifiable under subheading 8471.91.80, HTSUS, which
provides for: "Automatic data processing machines and units
thereof . . . : [o]ther: [d]igital processing machines, whether
or not entered with the rest of a system, which may contain in
the same housing one or two of the following types of units:
storage units, input units, output units: [o]ther. . . . " The
general, column one rate of duty is 3.5 percent ad valorem.
Sincerely,
John Durant, Director
Commercial Rulings Division