CLA-2 R:C:M 957743 LTO
Mr. Dennis Heck
Tower Group International
5420 West 104th Street
Los Angeles, California 90045-6069
RE: Video Door Phone Surveillance Monitoring System; camera
unit; monitor unit; HQs 087404, 088748, 957722; DD 806755
modified; GRI 3; composite good; EN to GRI 3(b); EN to
section XVI; section XVI, notes 3 and 4; subheading 8517.81.00
Dear Mr. Heck:
This is in response to your letter of March 22, 1995,
requesting, on behalf of Vivitar Corporation, reconsideration of
DD 806755, dated March 7, 1995, concerning the classification of
a video door phone surveillance monitoring system and components
thereof under the Harmonized Tariff Schedule of the United States
(HTSUS). Pursuant to section 625(c)(1), Tariff Act of 1930 (19
U.S.C. 1625(c)(1)), as amended by section 623 of Title VI
(Customs Modernization) of the North American Free Trade
Agreement Implementation Act, Pub. L. No. 103-182, 107 Stat.
2057, 2186 (1993), notice of the proposed modification of DD
806755 was published August 2, 1995, in the Customs Bulletin,
Volume 29, Number 31.
FACTS:
The article in question is the SMS-4 Video Door Phone
Surveillance Monitoring System (056434). The system is a
complete home or office security system which provides two-way
audio and one-way video communication. The system consists of a
4-inch monochrome monitor, charge-coupled device (CCD) monochrome
entry camera unit with mounting kit, switching unit, 66-foot
extension cord and AC/DC adaptor. The - 2 -
CCD camera can be hardwired to the monitor by means of the
existing door bell wiring,
or, if for a new installation, a single or coaxial cable (not
included) may be used.
The SMC-401B CCD Entry Camera (056442) is a water resistant,
shock-proof camera that incorporates a 2 x 3 inch oval speaker
and microphone for hands-free video and audio capability. The
camera utilizes solid-state electronic technology and
incorporates a CCD. The camera's power is supplied by the SMS-4R
4" Monitor (056443), which is a monochrome monitor with a 4 inch
(10.1 cm visual display diagonal) flat cathode ray tube (CRT).
The monitor, which also incorporates a speaker and microphone, is
powered by a 110V AC/22V DC adaptor. The optional GSU-4
Switching Unit (056467) is a switch box which allows the
connection of up to four cameras to the monitor unit. The GA04
AC/DC Adaptor (056468) is an 11V AC22V DC adaptor and is used to
power the monitor, as well as the entire system. The GC-66 66-foot Extension Wire (056466) is an insulated wire with fittings.
The system is often installed in apartment buildings to
permit communication between a monitor located inside an
apartment and an external unit located on an outside door. The
external unit, consisting of the CCD camera, is connected to the
internal monitor, which enables the resident to see and talk to
the visitor.
ISSUE:
Whether the Video Door Phone Surveillance Monitoring System
is classifiable according to General Rule of Interpretation 3,
HTSUS, under heading 8517, HTSUS, which provides for electrical
apparatus for line telephony, or heading 8525, HTSUS, which
provides for television transmission apparatus.
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 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).
In DD 806755, issued to you on March 7, 1995, the Video Door
Phone Surveillance Monitoring System was held to be classifiable
under subheading - 3 -
8517.81.00, HTSUS, which provides for other electrical apparatus
for line telephony. You contend that the system is classifiable
under subheading 8525.30.90, HTSUS, which provides for other
television cameras.
The Video Door Phone Surveillance Monitoring System consists
of a CCD camera, monochrome video monitor, switching unit, AC
adaptor and extension wire. Both the CCD camera and monochrome
monitor incorporate a speaker and microphone. Classification of
the camera unit and monitor unit, when imported separately, is
based on note 3 to section XVI, HTSUS, which provides as follows:
composite machines consisting of two or more machines
fitted together to form a whole and other machines
adapted for the purpose of performing two or more
complementary or alternative functions are to be
classified as if consisting only of that component or
as being that machine which performs the principal
function.
The audio (speaker and microphone) and video (camera or
monitor) components of the camera unit and monitor unit are
equally important to the overall functioning of each unit. It is
therefore our opinion that it is not possible to determine which
component performs each unit's "principal function." Thus, in
accordance with GRI 1, note 3 to section XVI, HTSUS, and based on
the principles of GRI 3(c) (see General EN to section XVI, pg.
1133), the camera unit is classifiable under subheading
8525.30.90, HTSUS, while the monitor unit is classifiable under
subheading 8528.20.00, HTSUS, which provides for black and white
or other monochrome video monitors. See HQ 957722, issued to you
on May 12, 1995 (although not specified, a CCD camera and
monitor, imported separately, were similarly classified in
accordance with note 3 to section XVI, HTSUS).
If imported separately, the switch box is classifiable under
subheading 8537.10.90, HTSUS, which provides for other panels for
electric control or the distribution of electricity. The AC/DC
adaptor is classifiable under subheading 8504.40.80, HTSUS, which
provides for other static converters. Both were properly
classified in DD 806755. Further, the extension wire, which was
not considered in DD 806755, is classifiable under subheading
8544.41.00, HTSUS, which provides for insulated wire, fitted with
connectors, for a voltage not exceeding 80 V.
As there is no single heading that covers all of the
components of this system, it is necessary to resort to GRI 3,
HTSUS, which governs the classification of goods that are, prima
facie, classifiable under two or more headings. GRI 3(a)
requires that the heading which provides the most specific
description shall be preferred to headings - 4 -
providing a more general description. However, when two or more
headings each refer to part only of the components contained in a
composite good, those headings are to be regarded as equally
specific in relation to those goods. Headings 8504, 8525, 8528,
8537 and 8544, HTSUS, each refer to part only of the components
of the Video Door Phone Surveillance Monitoring System.
Accordingly, no heading provides a specific description of the
system.
GRI 3(b), HTSUS, provides that "composite goods consisting
of different materials or made up of different components, . . .
which cannot be classified by reference to 3(a), shall be
classified as if they consisted of the material or component
which gives them their essential character, insofar as this
criterion is applicable." The system consists of components
which are separable but can be attached by cables. The
components are "adapted one to the other and are mutually
complementary," in that they form a system that is designed to
provide two-way audio and one-way video communication. See EN to
GRI 3(b), pg. 4. Moreover, as the camera unit and monitor unit
have specially designed housings and/or mounting brackets, "the
design and intended use of these components would prevent them
from normally being sold separately." See HQ 087404, dated
December 7, 1990; HQ 957722. Thus, the system is a GRI 3(b)
composite good, and it is classifiable as if consisting of the
component which gives the system its "essential character."
The various components of the camera unit and monitor unit
work together to provide audio and video communication. The
microphone of the camera unit and the speaker of the monitor unit
(and vice versa) function together to provide two-way audio
communication. The camera of the camera unit and the monitor of
the monitor unit function together to provide one-way video
communication. As both units are necessary to perform either
audio or video communication, it is our opinion that they play an
equal role in relation to the use of the system, and that neither
gives the system its essential character. Thus, it is necessary
to resort to GRI 3(c), which states that "[w]hen goods cannot be
classified by reference to 3(a) or 3(b), they shall be classified
under the heading which occurs last in numerical order among
those which equally merit consideration." The primary components
of the system are the camera unit and monitor unit, and
therefore, the switching unit, adaptor and extension wire do not
merit equal consideration. Accordingly, the Video Door Phone
Surveillance Monitoring System is classifiable under heading
8528, HTSUS, specifically under subheading 8528.20.00, HTSUS. DD
806755 is modified with regard to the classification of the
complete system, as well as, the camera unit and monitor unit,
when imported separately.
The Video Door Phone Surveillance Monitoring System cannot
be classified according to note 3 to section XVI, HTSUS. The
system consists of components connected either by means of
existing wiring or a single or coaxial cable. It does not - 5 -
consist of machines "fitted together to form a whole." See
General EN to section XVI, pg. 1133 (machines must be
"incorporated one in the other or mounted one on the other, or
mounted on a common base or frame or in a common housing").
Further, the system does not consist of machines adapted to
perform "complementary or alternative functions." See General EN
to section XVI, pg. 1132 (i.e., "machine-tools for working metal
using interchangeable tools, which enable them to carry out
different machining operations . . . ."). Thus, reference to
note 3 to section XVI, HTSUS, in this instance is misplaced.
Finally, we note that the system cannot be classified
according to note 4 to section XVI, HTSUS, as a "functional
unit." While the system does consist of individual components,
interconnected by electric cables or other devices, the
components do not "contribute together to a clearly defined
function covered by one of the headings in chapter 84 or chapter
85 . . . (emphasis added)."
HOLDING:
The SMS-4 Video Door Phone Surveillance Monitoring System
is classifiable, according to GRI 3(c), under subheading
8528.20.00, HTSUS, which provides for black or white video
monitors. The corresponding rate of duty for articles of this
subheading is 5% ad valorem.
If imported separately, the SMC-401B Charge-Coupled Device
Monochrome Camera is classifiable under subheading 8525.30.90,
HTSUS, which provides for other television cameras (3.8% ad
valorem). The SMS-4R Monitor is classifiable under subheading
8528.20.00, HTSUS (5% ad valorem). The GSU-4 Switching Unit is
classifiable under subheading 8537.10.90, HTSUS, which provides
for other panels for electric control or the distribution of
electricity (4.8% ad valorem). The GC-66 66-foot Extension Wire
is classifiable under subheading 8544.41.00, HTSUS, which
provides for insulated wire, fitted with connectors, for a
voltage not exceeding 80 V (4.8% ad valorem). The GA04 AC/DC
Adaptor is classifiable under subheading 8504.40.80, HTSUS, which
provides for other static converters (2.7% ad valorem).
In accordance with 19 U.S.C. 1625(c)(1), this ruling will
become effective 60 days after publication in the Customs
Bulletin. Publication of rulings or decisions pursuant to 19
U.S.C. 1625(c)(1) does not constitute a change of practice or
position in accordance with section 177.10(c)(1), Customs
Regulations (19 CFR 177.10(c)(1)).
EFFECT ON OTHER RULINGS:
DD 806755, dated March 7, 1995, is modified with regard to
the classification of - 6 -
the Video Door Phone Surveillance Monitoring System, as well as
the camera unit and monitor unit, when imported separately.
Sincerely,
John Durant,
Director
Commercial Rulings
Division