CLA-2-RR:CTF:TCM 967388 IOR
Tariff No.: 9013.80.90 HTSUS
Port Director
Customs and Border Protection
1205 Royale Lane
DFW, TX 75261
Attn: Chuck Hawkins, IS
Re: Protest AFR No. 5501-03-100072; fixed and variable attenuators
Dear Port Director:
This is our decision on the application for further review (AFR) of protest no. 5501-03-100072, filed against the Customs and Border Protection (CBP) classification of fixed and variable attenuators, under the Harmonized Tariff Schedule of the United States (HTSUS). Our decision follows teleconferences held on July 19, 2005, and November 15, 2005, between the protestant and a member of the staff of the Office of Regulations and Rulings, Tariff Classification & Marking Branch. Supplemental information was requested, and provided, however requests for further clarification of the supplemental information were not responded to. A sample of the fixed attenuator was provided.
FACTS:
The five protested entries of fixed and variable attenuators were made in March and April 2002 by Fujitsu Network Communications, Inc. (“FNC”). The merchandise was entered under subheading 9013.80.90, HTSUS, as “other optical appliances and instruments, not specified or included elsewhere in this chapter.” Entries 004-xxxx076-7 and 004-xxxx069-0 included fixed attenuators, and the remaining three entries, 004-xxxx433-3, 004-xxxx040-1, and 004-xxxx723-1, included variable attenuators. The entries were liquidated as entered on January 31, and March 14, 2003, classifying the attenuators under heading 9013, HTSUS, as other optical appliances. A timely protest was filed by FNC on May 1, 2003. The protest asserts that the fixed and variable attenuators belong to the same category and carry the similar type of optical control functions as dispersion compensation modules (DCM’s), and are specially designed for and used in long-haul digital telecommunications systems. The protestant states that attenuators and DCM’s are all passive devices, functioning to control optical signals, although in different ways, to optimize the transmission performance. DCM’s were the subject of HQ 965942, dated December 19, 2002, and the protestant asserts that the attenuators should be classified in accordance with HQ 965942. The protestant asserts that the imported attenuators should have been classified under heading 8517, HTSUS, as “other apparatus for carrier current or digital line systems.”
The protestant describes the fixed attenuator as follows:
Fixed attenuators are also passive devices used to reduce optical strength to optimal levels and can be used on single or multi-channel optical signals. Unlike variable attenuators, fixed attenuators cannot be adjusted and provide only a single attenuation value (e.g. 5dB. 10dB or 15 dB). Fixed attenuator is usually installed on other [PCA] carrying a specific multiplex function for the long-haul digital telecommunication systems. The PCA can be plugged into a network shelf. The signal carries voice, data and video transmitted via optical fiber cable.
The protestant has provided further information that the fixed attenuator is not imported on a PCA. The fixed attenuator is a small metal cylindrical device approximately 2” long, with a ceramic type material in the center. The components of the fixed attenuator are numerous small components, such as a stopper, nut, spring, fixing screw, and optical elements in the form of optical fibers and attenuation film. The optical signal goes through the center of the device, where attenuation film between optical fibers attenuates the optical signal from the optical fiber. After importation the fixed attenuators are installed on a PCA carrying a specific multiplex function. The PCA is installed on a network shelf in the Flashwave 7700 amplifier. The fixed attenuators attenuate the wavelength-division multiplexing (WDM) signal as the signal is input into the Flashwave 7700 amplifiers.
The protestant describes the variable attenuator as follows:
Variable attenuator unit is a passive device used in [FNC’s] long-haul digital transmission systems to reduce optical strength to optimal levels. Either a per-channel or multi-channel optical signal enters the attenuator and has the signal strength reduced to optimize [FNC] optical transmission equipment performance. Unit attenuation can be adjusted within the unit’s attenuation range (e.g. from 3 to 7 dB). Most of [FNC’s] variable attenuator [sic] comes in the form of printed circuit assembly (PCA) that is plugged into a metal shelf which is installed in either a single 7’ bay or an 11’ high by 23” wide OC-48 Network bay.
The protestant has provided further description regarding the variable attenuator. The protestant asserts that the variable attenuator consists of numerous components on a printed circuit assembly (PCA). The components on the PCA include a spool of fiber optical cable, memory chips, and eight identical attenuator modules. Each attenuator module includes couplers for monitoring the incoming signal, analog-to-digital and digital-to-analog converters for the monitor/control data, and an optical attenuator that provides attenuation. The memory chips support the memory requirements for the on board CPU (central processing unit) when performing its processing to manage optical levels. The onboard CPU controls the degree of attenuation of each channel. The board is approximately 5” by 8”. The protestant refers to the variable attenuator unit as the VAT2 card.
The VAT2 cards are used in a Flashwave 7600 shelf, in which the VAT2 cards attenuate the individual input signals before they are sent to the multiplex cards. Each VAT2 card provides attenuation for up to eight optical channels. Each Flashwave 7600 shelf supports up to 4 VAT2 cards for a total of 32 optical channels per shelf. According to the protestant, the Flashwave 7600 is found mostly in offices of telecommunications providers where telecommunications traffic is funneled. The 7600 takes in communications channels from various equipment and consolidates it onto fiber optic cable. Further information regarding the VAT2 card was requested but not provided. Specifically the protestant was requested to provide a clearly labeled schematic, in English, of the VAT2 card, and the attenuator modules contained therein, as well as the composition of the optical attenuator within the attenuator module, and a description of how the optical attenuator functions. The protestant has provided with the protest, a schematic of the variable attenuator, however the schematic is not in English and does not appear to identify the components of the VAT2.
It is asserted that the VAT2 cards and the fixed attenuators are not functional outside of telecommunications systems. Product literature describes the Flashwave 7600 and 7700 as apparatus for long-haul networks.
ISSUE:
Whether the attenuators are classified under heading 8517, HTSUS, as “electrical apparatus for line telephony or line telegraphy,” or heading 9013, HTSUS as “other optical appliances and instruments.”
LAW AND ANALYSIS:
Initially we note that the matter protested is protestable under 19 U.S.C. §1514(a)(2) as a decision on classification, and the protest was timely filed, within ninety days of the liquidation of the entry.
Merchandise is classifiable under the HTSUS in accordance with the General Rules of Interpretation (GRIs). The systematic detail of the HTSUS is such that most goods are classified by application of GRI 1, that is, 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 2 through 6 may then be applied in order.
The HTSUS provisions under consideration are as follows:
8517 Electrical apparatus for line telephony or line telegraphy, including
line telephone sets with cordless handsets and telecommunication
apparatus for carrier-current line systems or for digital line systems;
videophones; parts thereof:
8517.50 Other apparatus, for carrier-current line systems or for digital
line systems:
Other:
Telegraphic:
8517.50.90 Other………………………………………
8517.90 Parts:
Other parts, incorporating printed circuit assemblies:
8517.90.34 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:
9013.80.90 Other……………………………………………………..
Section XVI Note 1(m), HTSUS provides that section XVI does not cover articles of chapter 90. Heading 8517, HTSUS, is included in section XVI, HTSUS. With respect to the application of Note 1(m), the decision in Sharp Microelectronics Technology, Inc v. United States, 122 F.3d 1446 (Fed. Cir. 1997), is instructive. In Sharp, the Court of Appeals determined that Note 1(m) can be complementary to a relative specificity analysis between competing headings. Id. at 1450-1451.
The fixed attenuator, by itself is not telecommunications apparatus but is a part thereof. As such, it is prima facie described in heading 8517, HTSUS, as a part of “[e]lectrical apparatus for line telephony or line telegraphy, including line telephone sets with cordless handsets and telecommunication apparatus for carrier-current line systems or for digital line systems.”
The fixed attenuator is also described as “optical appliances and
instruments.” Additional U.S. Note 3, to Chapter 90, HTSUS, states as follows:
For 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 fixed attenuator incorporates optical elements, in the form of the attenuation film, and the optical fibers which direct light by attenuating, or reducing, the optical signal. The attenuation of the light is the only purpose of the fixed attenuator, therefore the optical elements for the purpose of attenuating the light, are not for a subsidiary purpose. Accordingly, we conclude that the fused coupler is prima facie described in heading 9013, HTSUS.
In Sharp, supra, the Court of Appeals affirmed the Court of International Trade’s (CIT) conclusion that under a relative specificity analysis, a parts provision is less specific than heading 9013, HTSUS. The CIT had looked “to the provision with ‘requirements which are more difficult to satisfy and which describe the article with the greatest degree of accuracy and certainty’, citing Amersham Corp. v. United States, 5 C.I.T. 49, 564 F. Supp. 813, 824 (Ct. Int’l Trade 1983).” Id. at 1449. The CIT had also applied Additional U.S. Rule of Interpretation (AUSRI) 1(c), which provides that “a provision for ‘parts’ or ‘parts and accessories’ shall not prevail over a specific provision for such part or accessory.” In this case, under a relative specificity analysis, as applied in Sharp, we find that the fixed attenuator is precisely described by heading 9013, HTSUS as “optical appliances and instruments,” and heading 9013 is more difficult to meet than a parts provision. In addition, under AUSRI 1(c), the specific heading of 9013, HTSUS, is preferred over the “parts” provision. In HQ 966041, dated April 29, 2003, citing Sharp, supra, it was determined that the terms “not elsewhere specified or included” in heading 9013, HTSUS, does not render the heading a “basket” or non-specific provision. Therefore, under a relative specificity analysis, the fixed attenuator is classified under heading 9013, HTSUS.
The protestant takes the position that under CBP precedent, goods which are principally used for digital line system transmission, are classified under heading 8517, HTSUS. Specifically, the protestant cites to HQ 965942, dated December 19, 2002. In the cited ruling, two articles were at issue, a DCM and a circuit pack. The circuit pack was a more complex article which contained optical instruments or appliances. In HQ 965942, the optical instrument or appliance was used for a subsidiary purpose, therefore the circuit pack was not classifiable in heading 9013, HTSUS. With respect to the DCM, there is no indication that there was any optical element involved, therefore it would not have been classifiable in heading 9013, HTSUS. We incorporate herein, by reference, the discussion in HQ 967549, dated October 14, 2005, which addressed the issue of whether goods principally used for digital line systems are precluded from classification in a provision other than heading 8517, HTSUS.
Based on the analysis in HQ 967549, we find that the fixed attenuators are optical appliances and optical instruments classified under heading 9013, HTSUS, specifically in subheading 9013.80.90, HTSUS, as “[l]iquid 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: Other devices, appliances and instruments: Other.”
With respect to the VAT2, we do not have sufficient evidence that, it is in fact not classified in heading 9013, HTSUS, as we were not provided with a schematic in English of the VAT2. Under 28 U.S.C. § 2639 (a) (1) (1994), CBP enjoys a statutory presumption of correctness. Thus an importer has the burden to prove by a preponderance of the evidence that a CBP decision was incorrect. Ford Motor Company v. United States, 157 F.3d 849, 855 (Fed. Cir. 1998). In order to determine that the VAT2 is not classifiable in heading 9013, HTSUS, we require evidence that the optical elements are for a subsidiary purpose, and as such, the articles are not classifiable in heading 9013, HTSUS. At a minimum, evidence in the form of a schematic, documenting the assertions of the protestant is required before we can make a determination that the classification of the VAT 2 was incorrect. The CIT has ruled that mere assertions by a complainant without supporting evidence will not be regarded as sufficient to overturn a Customs official’s decision. Bar Bea Truck Leasing Co., Inc. V. United States, 5 CIT 124, 126 (1983). While we do not have evidence that the article was correctly classified in heading 9013, HTSUS, there is insufficient evidence to overcome the presumption of correctness enjoyed by CBP. Therefore we must deny the AFR on the basis that insufficient evidence was provided that the classification in heading 9013, HTSUS was incorrect.
We note that in, HQ 084357, dated June 6, 1989, and HQ 083966, dated June 14, 1989, variable optical attenuators were classified in heading 9031, HTSUS, and in HQ 084356, dated June 2, 1989, variable optical attenuators were classified in heading 9013, HTSUS. The variable attenuators classified in heading 9031, HTSUS, are distinguishable from the fixed attenuators and VAT2 cards classified herein as they were determined to be specifically described as measuring or checking instruments, and classifiable in heading 9031 HTSUS, as well as in heading 9013, HTSUS. The attenuators were classified in accordance with Note 5 to Chapter 90, HTSUS. The variable attenuators classified in heading 9013, were classified in accordance with GRI 3(c), which provides that when goods cannot be classified in accordance with GRI 3(a) or 3(b), they are to be classified under the heading which occurs last in numerical order, among those which equally merit consideration. Although the analysis in HQ 084356 is inconsistent with the analysis herein, we find the classification to be correct based on the analysis herein as applied with respect to the fixed attenuator.
HOLDING:
By application of GRI 1 and 3(a), the fixed attenuators are classified in subheading 9013.80.9000, HTSUSA, which provides for “[l]iquid 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: Other devices, appliances and instruments: Other,” with a column one, general duty rate of (in 2002) 4.5% ad valorem.
On the basis of insufficient evidence to the contrary, the subject variable attenuators are classified, as liquidated, in subheading 9013.80.9000, HTSUSA, which provides for “[l]iquid 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: Other devices, appliances and instruments: Other,” with a column one, general duty rate of (in 2002) 4.5% ad valorem. Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the internet at www.usits.gov/tata/hts/.
The protest should be DENIED in full. In accordance with the Protest/Petition Processing Handbook (CIS HB, June 2002, pp. 18 and 21), you are to mail this decision, together with the Customs Form 19, 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 the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division