CLA-2 RR:CR:GC 960815 DWS
Port Director of Customs
1624 E. 7th Avenue, Suite 101
Tampa, FL 33605
RE: 1801-97-100022; Laser Diode Modules; NEC v. U.S.
Dear Port Director:
The following is our decision regarding Protest 1801-97-100022 concerning your action in classifying and assessing duty
on laser diode modules under the Harmonized Tariff Schedule of
the United States (HTSUS).
FACTS:
Based upon the information provided, the merchandise
consists of laser diode modules (LDMs), each of which is
comprised of a laser diode component, a built-in coaxial optical
isolator and 25 ohm impedance matching circuit, a photodiode for
optical monitoring, and, in some cases, a fiber pigtail allowing
coupling to a fiber optic cable. The LDMs are used in an Optical
Wavelength Division Multiplexer (an optical networking system) to
convert electronic signals into laser light.
The merchandise was entered on September, 10, 18, 25, 30,
October, 2, 9, June 6, 20, 25, July 3, 11, 15, 17, 30, 31, August
6, and December 30, 1996, under subheading 9013.20.00, HTSUS, as
lasers, other than laser diodes. However, the protestant now
claims classification of the LDMs under subheading 8541.40.95,
HTSUS, as other photosensitive semiconductor devices. The
entries were liquidated on January 24, 31, and February 14, 1997,
under subheading 9013.80.60, HTSUS, as other optical instruments,
not specified or included elsewhere in chapter 90, HTSUS. The
protest was timely filed on February 22, 1997.
ISSUE:
Whether the LDMs are classifiable under subheading
8541.40.20, HTSUS, as light-emitting diodes (LEDs), under
subheading 8541.40.95, HTSUS, as other photosensitive
semiconductor devices, or under subheading 9013.80.60, HTSUS, as
other optical instruments, not specified or included elsewhere in
chapter 90, 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 is determined according to the
terms of the headings and any relative section or chapter notes.
The 1996 HTSUS provisions under consideration are as
follows:
8541 Diodes, transistors and similar semiconductor devices;
photosensitive
semiconductor devices, including photovoltaic cells whether
or not
assembled in modules or made up into panels; light-emitting
diodes;
mounted piezoelectric crystals; parts thereof:
8541.40 Photosensitive semiconductor devices, including
photovoltaic cells whether or not assembled in modules
or made up into panels; light- emitting diodes:
8541.40.20 Light-emitting diodes (LED's).
Other:
8541.40.95 Other.
* * * * * * * * *
9013 Liquid crystal devices not constituting articles provided
for more specifically
in other headings; lasers, other than laser diodes; other
optical appliances
and instruments, not specified or included elsewhere in this
chapter; parts
and accessories thereof:
9013.80 Other devices, appliances and instruments:
9013.80.60 Other.
* * * * * * * * *
NEC v. U.S., Slip Op. 97-38, March 28, 1997 (CIT), aff'd
Slip Op. 97-1403, May 19, 1998 (CAFC), dealt with the
classification of a LDM under the HTSUS similar to the subject
merchandise, consisting of a laser diode, a photodiode detector,
a
columnating lens, and/or an optical fiber attachment or
connector. In NEC, the Court held that laser diodes are
classifiable with LEDs under subheading 8541.40.20, HTSUS. It
also stated that:
[t]he Court makes a similar finding with respect to laser diode modules.
According to General
Rule of Interpretation 3(b), goods comprised of different components
must be classified as
though they were wholly made of the material or component which gives
their essential character.
Because the Court finds that the laser diode component gives the laser
diode module its essential
character, the Court's finding with respect to laser diodes controls the
classification of laser diode
modules.
Based upon the holding in NEC, because the subjects LDMs are
similar in kind to the LDM in NEC, we find that they belong to
the class or kind of merchandise classifiable under subheading
8541.40.20, HTSUS.
The protestant cites HQ 088628, dated August 20, 1991, as
precedent for the classification of the LDMs under subheading
8541.40.95, HTSUS. In HQ 088628, which dealt with the
classification of a LDM similar to the subject merchandise, we
held that the LDM, was classifiable under subheading 8541.40.95,
HTSUS, because it consisted of both a laser diode and a
photodiode. However, the holding in NEC states that, in such a
situation, the laser diode imparts the essential character of the
module and the LDM is classifiable under subheading 8541.40.20,
HTSUS. Therefore, the holding in NEC effectively revokes the
holding in HQ 088628.
Your office claims that, because the subject LDMs include
optical components, they are classifiable in heading 9013, HTSUS.
Chapter 90, additional U.S. note 3, HTSUS, states that:
[f]or the purposes of this chapter the terms "optical appliances" and
"optical instruments" refer only to those appliances and instruments which
incorporate one or more optical elements, but do not include any appliances
or instruments in which the incorporated optical element or elements are solely for viewing a scale or for some other subsidiary purpose.
The LDM in NEC also contained optical components. However,
because the Court did not entertain classification of the LDM in
heading 9013, HTSUS, we must infer that the optical components
for this class of merchandise are subsidiary to the function of
the laser diode. Therefore, based upon chapter 90, additional
U.S. note 3, HTSUS, the subject LDMs do not meet the terms of
"optical instruments" and are precluded from classification in
heading 9013, HTSUS.
HOLDING:
The LDMs are classifiable under subheading 8541.40.20,
HTSUS, as LEDs.
You should DENY the protest, except to the extent
reclassification of the merchandise as indicated above results in
a partial allowance. 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 this 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