CLA-2 OT:RR:CTF:TCM H068279 JPJ
Port Director
U.S. Customs & Border Protection
10 Causeway Street
Boston, Massachusetts 02222
RE: Protest 0401-09-100071; ThermoVision 2000 Series MultiSensor System; ThermoVision 3000 Series MultiSensor System
Dear Port Director:
This is in response to your memorandum dated June 12, 2009, forwarding Protest and AFR 0401-09-100071, filed on behalf of FLIR Systems, Inc. (“FLIR”), concerning the classification, under the Harmonized Tariff Schedule of the United States (HTSUS), of the ThermoVision 2000 Series MultiSensor System (“THV-2000 MS”) and the ThermoVision 3000 Series MultiSensor System (“THV-3000 MS”). In reaching our decision, consideration was also given to protestant’s additional grounds for protest dated February 4, 2010.
FACTS:
The merchandise is identified as the ThermoVision 2000 Series MultiSensor System (“THV-2000 MS”) and the ThermoVision 3000 Series MultiSensor System (“THV-3000 MS”). The system consists of a camera, power supplies, cables, a joystick control unit, software and other components. The system is imported with a fitted case.
According to protestant’s website at www.flir.com, the THV-2000 MS/THV-3000 MS incorporate a ThermoVision 2000/ThermoVision 3000 thermal imaging camera equipped with three different lenses that offer triple field of view optics (wide angle lens; medium field of view lens; and narrow field of view lens), and a cooled Quantum Well Infrared Photodetector (QWIP) offering thermal images of 320 x 240 pixels (THV-2000 MS) or 640 x 480 pixels. The ThermoVision 3000 contains Advanced Digital Detail Enhancement (DDE), which assures clear, properly contrasted thermal images and provides high quality thermal imaging in any night or daytime environmental conditions.
In addition to the thermal imaging camera, the THV-2000 MS/THV-3000 MS incorporate a standard daylight CCD imaging camera with a built-in digital video Sony FCB-EX-980S Color block camera (NTSC) and Sony FCB-EX-980SP Color block camera (PAL). The video output is NTSC or PAL composite video, 14-bit digital image data, and both cameras incorporate easily with common power and video interfaces found in existing and new security systems. Displaying both the thermal image and the daylight image at the same time is also possible.
In addition, the THV-2000MS/THV3000MS are equipped with an advanced global positioning system (GPS), a built-in digital magnetic compass, and an eye safe laser range finder (emitter/receiver). The THV-2000MS/THV3000MS are mounted on a Pan & Tilt mechanism providing continuous rotation, and can be connected to a RADAR in a “slew to cue” configuration. If the radar detects an object, the camera will automatically turn in the right direction and give you a visual image so that you can instantly see what the blip on the radar screen really means. The THV-2000MS/THV3000MS can be programmed to scan an entire area automatically. Different spots that need to be monitored periodically can be preset. The system will scan the predefined areas automatically.
Various options exist to connect the ThermoVision 2000 and ThermoVision 3000 and integrate them in an existing system. Both can be configured for stand alone use, as part of a network or in a hybrid configuration with a local and network based control (analog and TCP/IP configurations).
These systems are used in security and surveillance applications, in complete darkness, and in the most diverse weather conditions, and are suited for border and coastal surveillance and mid-range threat detection.
The THV-2000 MS and the THV-3000 MS were entered on separate entries on December 21, 2007 and December 24, 2007, and liquidated on October 31, 2008 and November 7, 2008, under subheading 9013.80.90, HTSUS, as other optical appliances and instruments, not specified or included elsewhere in this chapter. The cases, power supplies, cables, joystick controls, etc. were separately classified in headings 3923, HTSUS, 8504, HTSUS, and 9027, HTSUS.
The protest was timely filed on April 29, 2009. Protestant argues that the correct classification of the merchandise at issue is heading 8525, HTSUS; and, specifically, subheading 8525.80.30, HTSUS, as other television cameras, or subheading 8525.80.50, HTSUS, as other digital cameras.
ISSUE:
What is the classification of the ThermoVision 2000/ThermoVision 3000 Series MultiSensor Systems?
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. The protest was timely filed within 180 days of liquidation of the first entry for entries made on or after December 18, 2004. (Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2)(B)(ii), (iii) (codified as amended at 19 U.S.C. § 1514(c)(3) (2006)).
Further Review of Protest No. 0401-09-100071 was properly accorded to protestant pursuant to 19 C.F.R. § 174.24(c) because the decision against which the protest was filed involves matters previously ruled upon by the Commissioner of Customs or his designee or by the Customs courts but facts are alleged or legal arguments presented which were not considered at the time of the original ruling. Protestant also complied with the requirements of 19 CFR §174.25 and, in that process, provided a “a statement of any facts or additional legal arguments, not part of the record, upon which the protesting party relies ….”
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRI). 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 HTSUS provisions under consideration are as follows:
8525 Transmission apparatus for radiotelephony, radiotelelgraphy, radiobroadcasting or television, whether or not incorporating reception apparatus or sound recording or reproducing apparatus; television cameras; still image video cameras and other video camera recorders; digital cameras:
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:
Note 1(h) to Chapter 90 states, in relevant part, as follows:
This chapter does not cover:
(h) . . .television cameras, digital cameras and video camera recorders (heading 8525). . .
The Harmonized Commodity Description and Coding System Explanatory Notes ("EN") 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, 54 Fed. Reg. 35127-28 (Aug. 23, 1989).
The THV-2000 MS and the THV-3000 MS incorporate an infrared thermal imaging camera, a standard daylight CCD imaging camera, an advanced global positioning system (GPS), a built-in digital magnetic compass, and an eye safe laser range finder (emitter/receiver). Infrared cameras have been classified in headings 9013 and 9027, HTSUS. See HQ 961289, dated March 30, 1998; HQ 965903, dated November 19, 2002; NY I87272, dated October 29, 2002; NY 875965, dated July 28, 1992; and HQ 966171, dated June 27, 2003. CCD cameras have been classified in heading 8525, HTSUS. See HQ 953116, dated October 6, 1993; HQ 957722, dated May 12, 1995; HQ 962652, dated February 1, 2001; HQ 967723, dated August 29, 2005. GPS units have been classified in heading 8526, HTSUS. See HQ 955510, dated September 16, 1994; NY H83514, dated July 18, 2001. A digital compass (dashboard) has been classified in heading 9014, HTSUS. See NY R02779, dated November 30, 2005.
Since no heading of the HTSUS completely describes the THV-2000 MS and the THV-3000 MS, and, as noted above, the goods are prima facie classifiable in two or more headings, classification must fall to GRI 3. In particular, classification by application of GRI 3(b) should be examined.
GRI 3(b) provides:
3. When, by application of rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows:
(b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, 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.
Since the subject merchandise, including its power supplies, cables, joy
stick controls and related components, is considered a composite good
made up of different components, GRI 3(b) requires that classification be
based on the product that provides the set with its essential character.
The relevant ENs for GRI 3(b) provide:
VIII) The factor which determines essential character will vary as between different kinds of goods. It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.
There have been several court decisions on "essential character" for
purposes of classification under GRI 3(b). See, Conair Corp. v. United States,
29 C.I.T. 888 (2005); Structural Industries v. United States, 360 F. Supp. 2d
1330, 1337-1338 (Ct. Int’l Trade 2005); and Home Depot USA, Inc. v. United
States, 427 F. Supp. 2d 1278, 1295-1356 (Ct. Int’l Trade 2006), aff’d 491 F.3d
1334 (Fed. Cir. 2007). “[E]ssential character is that which is indispensable to
the structure, core or condition of the article, i.e., what it is.” Home Depot
USA, Inc. v. United States, 427 F. Supp. 2d at 1293 quoting A.N. Deringer,
Inc. v. United States, 66 Cust. Ct. 378, 383 (1971). In particular in Home
Depot USA, Inc. v. United States, the court stated “[a]n essential character
inquiry requires a fact intensive analysis.” 427 F. Supp. 2d 1278, 1284 (Ct.
Int’l Trade 2006). Therefore, a case-by-case determination on essential
character is warranted in this situation.
Applying the essential character analysis to the present case, we have considered factors such as value of the components, cost, sophistication, reasons a person would purchase the merchandise, and the role of the constituent material in relation to the use of the goods. In this case, the infrared camera accounts for an overwhelming majority of the value of the goods. We believe that a consumer would not pay such a high price for a merchandise without an infrared camera. Since the infrared camera definitively drives the cost of this product, this factor is important in determining the essential character of the composite good.
We have also considered the role of the constituent material in relation to the use of the goods. In this case, the fact that the CCD camera, GPS, digital compass, and laser range finder merely assist or complement the function of the infrared camera.
Moreover, the protestant is recognized as a leader in the design, manufacture and marketing of thermal imaging and stabilized camera systems. Protestant also markets the instant merchandise as a high sensitivity quantum well infared photodetector (QWIP). Therefore, we conclude that the component that provides the essential character of the merchandise is the ThermoVision 2000/ThermoVision 3000 thermal imaging camera because it plays a vital role in the use and operation of the merchandise and it accounts for a majority of the cost.
We note our deicison is consistent with HQ 966171, dated June 27, 2003, in which CBP considered the classification of a Kelvin 350 III Video and Infrared Camera System that incorporated an infrared camera, a video camera, a GPS unit, a gimbal housing system, and a gyroscope. CBP determined that the merchandise was a composite good, and pursuant to GRI 3(b) held that the essential character of the merchandise was imparted by the infrared camera.
Protestant argues that the thermal imaging camera is classifiable under heading 8525, HTSUS, as “television cameras” or as “digital cameras”. Protestant argues that, while the HTSUS does not define the terms “television
camera” or “digital camera”, those terms are to be interpreted consistent with their common meaning.
The terms “television cameras” and “digital cameras” are not defined in the HTSUS or in the Explanatory Notes to heading 8525, HTSUS. When a tariff term is not defined in the HTSUS, we may look to its legislative history or, failing that, to its common and commercial meaning. See, for e.g., Rocknel Fastener, Inc. v. United States, 267 F.3d 1354, 1356 (Fed. Cir. 2001).
Protestant cites to the Merriam-Webster on-line dictionary at www.merriam-webster.com and argues that a “digital camera” is commonly defined as “a camera that records images as digital data instead of on film”. Protestant also cites to the McGraw-Hill Encyclopedia of Science and Technology and argues that “television cameras” are commonly defined as:
portable cameras. . .usually combine all of the basic elements into one package and may be used for a multitude of purposes. . .The units often have built-in microphones, video-cassette recorders, and batteries for completely self-contained operation...These compact and lightweight camcorders can be easily handled by one person.
Protestant further argues that because nothing in the definition of a “digital camera” limits the type of images that a digital camera may record, and the definition of “television cameras” is inclusive of a broad array of characteristics and functions.
Protestant argues that CMOS, CCD and QWIP are all types of focal place arrays (FPAs) and nothing in the ENs restrict the frequency of light the images record. Therefore, protestant states pursuant to Note 1(h) to chapter 90, HTSUS, the merchandise is classifiable under heading 8525, HTSUS, and specifically under subheading 8525.80.30, HTSUS as television cameras, or under subheading 8525.80.50, HTSUS, as digital cameras.
We have looked to the legislative history of heading 8525, HTSUS. In 2002 the text of EN 85.25 was updated to reflect that: (1) “data may be stored in analogue or digital form”; (2) “the cameras of the heading capture an image by focusing the image onto a light-sensitive device, such as a complementary metal oxide semiconductor (CMOS) or charge-coupled device (CCD)”; and, (3) “Generally, these cameras are equipped with an optical viewfinder or a liquid crystal display (LCD), or both. Many cameras equipped with an LCD can employ the display both as a viewfinder when taking pictures and as a screen when reproducing images already recorded; in some cases the camera is capable of displaying images received from other sources on the LCD screen.” EN 85.25(D) (2002).
The inclusion of this text reflected the unanimous decision of the Harmonized System Committee, taken at its 21st Session (March 1998), to classify a “LCD digital camera” with a 1.8” color LCD screen in subheading 8525.40. See Harmonized Commodity Description and Coding System, Compendium of Classification Opinions, CO 8525.40/1. (Digital still camera fitted with a Charge Coupled Device (CCD) and based on video camera recorder technology). Also, the phrase “digital cameras” was added to the text of heading 8525 and subheading 8525.40, HTSUS (2002).
In 2007, when changes were made to the HS, text was added to EN 85.25 which further clarified that the group including digital cameras and video camera recorders “covers cameras that capture images and convert them into an electronic signal that is … recorded in the camera as a still image or as a motion picture (i.e., digital cameras and video camera recorders).” EN 85.25(B) (2007).
The Explanatory Notes to heading 8525, HTSUS, explain, in relevant part, that:
The cameras of this heading capture an image by focusing the image onto a light-sensitive device, such as a complementary metal oxide semiconductor (CMOS) or charge-coupled device (CCD). The light-sensitive device sends an electrical representation of the images to be further processed into an analogue or digital record of the images.”
….
EN 85.25(B) (2009). See also EN 85.25(D) (2002).
Insofar as the legislative history is dispositive of the meaning of cameras for purposes of heading 8525, HTSUS, we need not resort to the common meaning offered by protestant. See Rocknel Fastner, Inc., supra.
While not exhaustive, the ENs to heading 8525, HTSUS, specify that the cameras of heading focus the images onto a light senstaive device such as CMOS or CCD. We note that both CMOS and CCD operate in the visible light spectrum. From the legislative history, we find that heading 8525, HTSUS, provides for cameras that capture images onto a light-sensitive device, such as a CMOS or CCD, to form an image using visible light.
According to the technical specifications, the ThermoVision 2000/ThermoVision 3000 use a cooled QWIP FPA imaging device. QWIPs operate in a very narrow wavelength band (between 8 and 9 µm), but provide outstanding thermal resolution and unparalleled temperature-measurement capabilities. See http://optics.org. They are a good solution when ultra-high thermal sensitivity and high-speed data-acquisition is required in the long wavelengths. QWIP detectors operate in a temperature range from -20 to 2000ºC and are able to detect temperature differences as subtle as 0.02ºC. Id.
A thermographic camera detects radiation in the infrared range of the electromagnetic spectrum and produces images of that radiation. See www.websters-online-dictionary.org. Thermography makes it possible to “see” one’s environment with or without visible illumination. The amount of radiation emitted by an object increases with temperature, therefore thermography allows one to see variations in temperature. When viewed by a thermographic camera, warm objects stand out well against cooler backgrounds; humans and other warm-blooded animals become easily visible against the environment, day or night. As a result, thermography’s extensive use can be historically ascribed to the military and security services. . . Thermographic cameras are much more expensive than their visible-spectrum counterparts, and higher-end models are often export-restricted. Id.
Based on the history of heading 8525, HTSUS, and our research of the technology employed by the ThermoVision 2000/ThermoVision 3000 thermal imaging camera, we conclude that the merchandise is not described by the terms of heading 8525, HTSUS, because it does not capture light in the visible spectrum. Therefore, the merchandise is classified in heading 9013, HTSUS.
CBP has classified similar infrared cameras in heading 9013, HTSUS. Specifically, basic infrared cameras which merely allow the user to view in dark or smoky conditions, or display a picture showing objects due to their different temperatures, have been classified in subheading 9013.80.90, HTSUS. See, e.g., HQ 961289 (March 30, 1998); HQ 965903 (November 19, 2002); NY I87272 (October 29, 2002).
Lastly, we agree with protestant that the specially shaped cases imported with the THV2000 MS and THV3000MS are classifiable in accordance with GRI 5(a). As such, the cases are classified with the THV2000MS and THV3000MS.
HOLDING:
In accordance with GRI 3(b) and 5(a), the THV 2000 MS, the THV3000 MS and their cases are classified in heading 9013, HTSUS. They are specifically provided for in subheading 9013.80.90, as: "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: Other devices, appliances and instruments: Other.” The 2007 general, column one rate of duty was 4.5%.
Protest No. 0401-09-100071 is DENIED.
In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with this decision must be accomplished prior to the mailing of the decision. Sixty days from the date of the decision Regulations and Rulings of the Office of International Trade 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