CLA-2 OT:RR:CTF:TCM H236637 EGJ
Mabel Lee
Assistant Import Manager
James J. Boyle & Company
1200 Corporate Center Drive, Suite 350
Monterey Park, CA 91754
RE: Classification of a Home Theater Sound Bar Package
Dear Ms. Lee:
This is in response to your request of November 7, 2012, on behalf of your client, for a binding ruling on the tariff classification of a Vizio home theater sound bar package (sound bar package) under the Harmonized Tariff Schedule of the United States (HTSUS). You submitted this ruling request on behalf of the sound bar package manufacturer.
FACTS:
The Vizio sound bar package, model number SB4021M-A1, contains the following: the sound bar main unit which contains two speakers, the wireless subwoofer which contains one speaker, a power adapter, a user manual, a remote control with a battery included, wall mount brackets, a wall mount template and a 3.5 mm to RCA stereo audio cable. The weight of the sound bar package is approximately twenty pounds. The wireless subwoofer weighs eleven pounds and the sound bar main unit weighs five pounds.
The sound bar main unit includes a USB port, as well as connectors for digital optical cable, digital coaxial cable and 3.5 mm cable. The main unit has the ability to read audio files from a USB memory device. It can also project sound from connected devices, such as televisions, game consoles, tablets and laptops. According to the technical specifications, the sound bar main unit and the remote control communicate using infrared (IR) wireless signals.
ISSUE:
1. Is the sound bar package classifiable as a GRI 3(b) retail set?
2. If so, which item provides the set’s essential character?
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 2 through 6 may then be applied in order.
GRI 3(a)-(b) provide as follows:
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:
(a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods.
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The HTSUS provisions under consideration are as follows:
8504 Electrical transformers, static converters (for example, rectifiers) and inductors; parts thereof…
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8518 Microphones and stands therefor; loudspeakers, whether or not mounted in their enclosures; headphones and earphones, whether or not combined with a microphone, and sets consisting of a microphone and one or more loudspeakers; audio-frequency electric amplifiers; electric sound amplifier sets; parts thereof:…
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8519 Sound recording or reproducing apparatus:
Other apparatus:
8519.81 Using magnetic, optical or semiconductor media:
8519.81.40 Other …
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8537 Boards, panels, consoles, desks, cabinets and other bases, equipped with two or more apparatus of heading 8535 or 8536, for electric control or the distribution of electricity, including those incorporating instruments or apparatus of chapter 90, and numerical control apparatus, other than switching apparatus of heading 8517…
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8543 Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof…
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Note 7 to Chapter 85 provides that:
7. Heading 8537 does not include cordless infrared devices for the remote control of television receivers or other electrical equipment (heading 8543).
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In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the Harmonized System at the international level. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989).
The ENs to GRI 3(b) provide, in pertinent part, that:
In all these cases the goods are to be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.
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.
…
(X) For the purposes of this Rule, the term “goods put up in sets for retail sale ” shall be taken to mean goods which:
(a) consist of at least two different articles which are, prima facie, classifiable in different headings. Therefore, for example, six fondue forks cannot be regarded as a set within the meaning of this Rule;
(b) consist of products or articles put up together to meet a particular need or carry out a specific activity; and
(c) are put up in a manner suitable for sale directly to users without repacking (e.g., in boxes or cases or on boards).
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EN 85.19 provides, in pertinent part, that:
This heading covers apparatus for recording sound, apparatus for reproducing sound and apparatus that is capable of both recording and reproducing sound. Generally, sound is recorded onto or reproduced from an internal storage device or media (e.g., magnetic tape, optical media, semiconductor media or other media of heading 85.23).
Sound recording apparatus modify a recording medium so that sound reproducing apparatus can subsequently reproduce the original sound-wave (speech, music, etc.). This includes recording based on the receipt of a sound-wave or by other methods, e.g., by recording data sound files, downloaded from an Internet page or a compact disc by an automatic data processing machine, onto the internal memory (e.g., flash memory) of a digital audio device …
(IV) OTHER APPARATUS USING MAGNETIC, OPTICAL OR SEMICONDUCTOR
MEDIA
The apparatus of this group may be portable. They may also be equipped with, or designed to be attached to acoustic devices (loudspeakers, earphones, headphones) and an amplifier …
(C) Apparatus using semiconductor media
This group includes apparatus which use semiconductor (e.g. solid-state non-volatile) media. Sound is recorded as digital code converted from amplified currents of variable intensity (analogue signal) on the recording medium. Sound is reproduced by reading such medium. The semiconductor media may be permanently installed in the apparatus or may be in the form of removable solid-state non-volatile storage media. Examples include flash memory audio players (e.g., certain MP3 players) which are portable battery operated apparatus consisting essentially of a housing incorporating a flash memory (internal or removable), a microprocessor, an electronic system including an audio-frequency amplifier, an LCD screen and control buttons. The microprocessor is programmed to use MP3 or similar file formats. The apparatus can be connected to an automatic data processing machine for downloading MP3 or similar files.
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EN 85.43(15) provides that:
This heading covers, inter alia:
(15) Cordless infrared devices for the remote control of television receivers, video recorders or other electrical equipment …
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The sound bar package consists of components which are classifiable in different headings. The subwoofer is classified as a loudspeaker of heading 8518, HTSUS. See New York Ruling Letter (NY) R01884, dated May 24, 2005, NY J84534, dated June 10, 2003, and NY G81047, dated August 31, 2000. The power adapter is classified as a rectifier of heading 8504, HTSUS. See NY N070895, dated August 17, 2009, and NY N026293, dated May 5, 2008. Note 7 to Chapter 85 states that remote controls which use infrared (IR) technology are classified under heading 8543, HTSUS. The sound bar package’s remote control utilizes IR technology; therefore, it is classified under heading 8543, HTSUS. See NY N088621, dated January 15, 2010, NY N071909, dated August 21, 2009, and NY R02825, dated December 6, 2005; see also EN 85.43(15).
Heading 8519, HTSUS, provides for sound reproducing apparatus. Such apparatus reads media that contains sound recordings. See EN 85.19. EN 85.19 also states that sound reproducing apparatus can be equipped with speakers. The sound bar main unit can read audio files from a USB non-volatile storage device and reproduce the sound through its speakers. As such, the sound bar main unit is classified as sound reproducing apparatus under heading 8519, HTSUS. See NY N182121, dated September 16, 2011 and NY N129141, dated November 16, 2010 (both rulings classify sound bars which reads USB devices in subheading 8519.81.40, HTSUS).
Applying GRI 3(b), the sound bar package components are put up together for retail sale. They are all put up together for the purpose of providing a sound system for use in a home theater. As such, the sound bar package consists of goods put up in a set for retail sale. We must classify the sound bar package according to the component which imparts the essential character.
In order to identify the component which imparts the essential character, the U.S. Court of International Trade (CIT) has applied the factors listed in EN VIII to GRI 3(b) which are “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.” The Home Depot v. United States, 427 F. Supp. 2d 1278, 1293 (Ct. Int’l Trade 2006). With regard to the component which imparts the essential character, the CIT has stated it is “that which is indispensable to the structure, core or condition of the article, i.e. what it is.” Id. citing A.N. Deringer, Inc. v. United States, 66 Cust. Ct. 378, 383 (1971).
Applying the aforementioned factors, the wireless subwoofer is the bulkiest and heaviest item in the sound bar package. The wire brackets are the most numerous items in the set as there are two of them. We do not have any information on the value of each item in the set. The role of the sound bar package is to provide high quality sound to a home theater system. The item which most contributes to this role is the sound bar main unit. The sound bar main unit contains two speakers and could function without the wireless subwoofer. All of the other items in the sound bar package are subsidiary in function to the sound bar main unit. As such, the sound bar main unit imparts the essential character to the sound bar package. The entire package is classified under subheading 8519.81.40, HTSUS, as sound reproducing apparatus which uses semiconductor media.
HOLDING:
By application of GRI 3(b), the sound bar package is classified under subheading 8519.81.40, which provides for: “Sound recording or reproducing apparatus: other apparatus: using magnetic, optical or semiconductor media: other …” The 2013 column one, general rate of duty is free.
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 World Wide Web at http://www.usitc.gov/tata/hts/.
A copy of this ruling letter should be attached to the entry documents filed
at the time the goods are entered. If the documents have been filed without a copy, this
ruling should be brought to the attention of the CBP officer handling the transaction.
Sincerely,
Ieva K. O’Rourke, Chief
Tariff Classification and Marking Branch