CLA-2 RR: CR: GC 964779 TPB
James L. Sawyer
Katten Muchin Zavis
525 W. Monroe Street
Suite 1600
Chicago, IL 60661-3693
RE: RCA eBooks; Electronic Dedicated Readers; Retail Sets
Dear Mr. Sawyer:
This is in response to your letter dated November 10, 2000, on behalf of Thomson Multimedia, Inc. (“Thomson”), formerly known as Thomson Consumer Electronics, Inc., to the Director, National Commodity Specialist Division, New York, requesting the classification, under the Harmonized Tariff Schedule of the United States (“HTSUS”), of two models of RCA eBooks imported by Thomson. By letter of December 21, 2001, you have informed us that since your original submission, Thomson has been importing its eBooks through the ports of Los Angeles, Indianapolis and Chicago. It is understood that Thomson produces and sells RCA brand products. Your letter was referred to this office for reply.
FACTS:
Thomson imports two models of RCA eBooks with their accessories packaged for retail sale made in either Taiwan or the People’s Republic of China (“PRC”).
The RCA eBook REB1100 is a dedicated electronic reading device designed to display text. It measures 7.5” x 5” x 1.5” and weighs 18 ounces. It features a 4.5” x 3” liquid crystal display (“LCD”) touch screen with 480 x 320 resolution. The REB 1100 contains an internal 33.6 kps modem, 8 MB of flash memory (capable of storing approximately 8,000 pages of printed text), a lithium battery (providing 20-40 hours of battery life), and a USB connection to a personal computer.
The RCA eBook REB 1200 is also a dedicated electronic reading device that is designed to display text. It measures 9” x 7.5” x 1.1” and weighs 33 ounces. It features a 7” x 5” color LCD touch screen with 640 x 480 resolution. The REB 1200 features an internal 56 kps modem, 8 MB of flash memory (capable of storing approximately 5,000 pages of printed text), a lithium battery (providing approximately 5 hours battery life), and an Ethernet interface with an RJ-45 connector.
At importation, both electronic readers are preprogrammed with a user’s guide, a book (Jules Verne’s Around the World in 80 Days), and an eDictionary (Random House Webster’s Pocket American Dictionary, 3rd Ed.).
Additional electronic text may be purchased and downloaded through the internet content provider. The internet content provider will store all electronic texts downloaded by a particular electronic reader on an internet “bookshelf” specified to that electronic reader’s unique identification number. The user will be able to access all the electronic texts selected and purchased (it is noted that certain electronic texts are available free of charge) at any time.
The REB 1100 and REB 1200 are imported with several accessories packaged as a set and ready for retail sale. In addition to the reader, the retail package for the REB 1200 includes a cleaning cloth, a stylus, a USB connector, a telephone cable, an AC power adapter, a vinyl (imitation leather) case, and removable lithium battery and flash memory card. The REB 1100 includes a cleaning cloth, a stylus, a telephone cable, an AC power adapter, a vinyl case, and a removable flash memory card. The REB 1100 also includes a CD-ROM with installation instructions and relevant software.
ISSUE:
What is the proper classification of RCA eBook dedicated electronic readers, Models REB 1100 and REB 1200?
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (“GRIs”). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied.
The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80.
The HTSUS provisions under consideration are as follows:
Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter…:
Other machines and apparatus:
Other:
Other:
Other:
8543.89.92 Electrical machines with translation or dictionary functions; flat panel displays other than for articles of heading 8528.
8543.89.96 Other:
In your letter of November 10, 2000, you claim that the electronic readers are properly classified under subheading 8543.89.92, HTSUS, which provides for electrical machines with translation or dictionary functions; flat panel displays other than for articles of heading 8528.
In your letter dated November 10, 2000, you state that “[t]he principal function of the RCA eBooks is to display electronic text to be read by users.” You indicate that “[a] secondary function of the devices is the dictionary function provided via the pre-installed eDictionaries on both the RCA eBook REB 1100 and 1200 models.”
The electronic readers can download electronic text via the device’s internal modem and display the text. They include an electronic dictionary provided by the pre-installed eDictionaries application. As they are designed for reading text, they do not have automatic data processing (“ADP”) capabilities (see Note 5 to chapter 84). Electronic dedicated readers are not provided for specifically in any heading of chapter 84, 85, or 90, HTSUS, and are therefore classified in heading 8543, HTS, because they have the individual function of enabling books to be read electronically.
To determine the correct subheading that the electronic readers are to be classified under, we refer to GRI 6, HTSUS, which provides as follows:
For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.
To determine the proper subheading classification for the readers, GRI 6 directs us to apply GRIs 1-5 once again at the subheading level. Subheading 8543.89.92, HTSUS, provides, in pertinent part, for electrical machines with translation or dictionary functions. Subheading 8543.98.96, HTSUS, provides for other electrical machines and apparatus. By applying GRI 1, when comparing the competing subheadings, we find that the eBooks are more properly described by the terms of subheading 8543.89.92, HTSUS, rather than by the basket provision of subheading 8543.89.96, HTSUS. The subject readers are electrical machines with dictionary functions. The word “with” indicates combination, accompaniment, presence, or addition, or means inclusive of (Merriam-Webster’s Collegiate Dictionary, 10th Ed., page 1354, 4a-b). In this case, the subheading does not require that the dictionary serve as the principal function of the electronic machine. Rather, it indicates that the mere presence of a dictionary function is all that is required.
Thus, at GRI 6, the RCA electronic dedicated readers are properly classifiable under subheading 8543.89.92, HTSUS, as electrical machines with translation or dictionary functions.
As indicated in your letter, the readers are imported with various accessories put up for retail sale. The classification of goods put up in sets for retail sale is governed by GRI 3(b). GRI 3(b) provides, in relevant part, that goods put up in sets for retail sale shall be classified as if they consisted of the material component which gives them their essential character. According to the ENs, the phrase “goods put up for retail sale” refers to goods which:
consist of at least two different articles which are, prima facie, classifiable in different headings;
consist of products or articles put up together to meet a particular need or carry out a specific activity; and
are put up in a manner suitable for sale directly to users without repacking.
Thomson’s electronic dedicated reader retail sets meet the ENs qualifications for “goods put up in sets for retail sale.” The components of the sets consist of numerous articles, which, if imported separately, would be classifiable in different headings. For example, the REB 1200 includes a cleaning cloth, stylus USB connector, telephone cable, AC power adapter, vinyl case, removable lithium battery and flash memory card. The REB 1100 includes a cleaning cloth, stylus, telephone cable, AC power adapter, vinyl case, and a removable flash memory card, as well as a CD-ROM with installation instructions and relevant software. All of the components placed in the electronic reader retail set are put up together to carry out the specific activity of operating the electronic reader. In their imported condition, the sets are packaged in a manner suitable for retail sale to the ultimate purchaser, without the need for further repacking. Thus, pursuant to GRI 3(b), the electronic reader retail sets are properly classified according to their essential character under the classification determined appropriate for each individual electronic reader, i.e. subheading 8543.89.92, HTSUS.
HOLDING:
For the reasons stated above, based on the application of GRI 1, via GRI 6, the RCA eBook dedicated electronic readers, Models REB 1100 and REB 1200 and RCA retail sets are to be classified under subheading 8543.89.92, HTSUS, as: electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter…other machines and apparatus…other…other…electrical machines with translation or dictionary functions….
Sincerely,
John Durant, Director
Commercial Rulings Division