CLA-2 OT: RR: CTF: TCM H237590 ERB
Port Director, Port of Dallas-Fort Worth
U.S. Customs and Border Protection
76501, Esters Blvd., Suite 160
Irving, TX 75063
Attn: Juana Kundak, Import Specialist
Re: Application for Further Review of Protest No. 5501-12-100148; tariff classification of cameras, camera handles,
Dear Port Director:
This is in response to the Application for Further Review (AFR) of Protest No. 5501-12-100148 filed on June 29, 2012, by counsel on behalf of the importer, Stryker Communications (Importer or Stryker), contesting U.S. Customs and Border Protection’s (CBP) classification and liquidation of cameras under the Harmonized Tariff Schedule of the United States (HTSUS). Our response follows.
FACTS:
Stryker imported eleven (11) entries between February 22, 2011 to March 18, 2011, into the Port of Dallas - Fort Worth. As a whole, the entries are unassembled components of a pendant lighting system used in medical clinics or surgical suites. Those components are light heads, light head handles, handles designed to be used with cameras, suspension arms, ceiling covers, and cameras. The eleven entries were not identical. Only one of these entries, however, contains the subject cameras.
CBP liquidated the cameras in subheading 8525.80.50, HTSUS, which provides for, “Transmission apparatus for radio-broadcasting or television, whether or not incorporating reception apparatus or sound recording or reproducing apparatus; Television cameras, digital cameras and video camera recorders: Other.”
The subject camera is designed to attach to the pendant lighting system, and was packaged and imported with its accompanying handles which allow the camera to be positioned when mounted into the light head. The camera transmits the video feed to an external monitor for viewing or remote recording. The camera does not have internal storage for video or images.
ISSUE:
What is the proper classification under the HTSUS of the subject cameras and accompanying camera handles.
LAW AND ANALYSIS:
Initially, we note that the matter is protestable under 19 U.S.C. §1514(a)(2) as a decision on a 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. 5501-12-100148 was properly accorded to the Protestant pursuant to 19 C.F.R. § 174.24(c), to the extent that this Protest involves questions of fact that have not been ruled upon by the Commissioner of CBP or any CBP Headquarters official, or by the Customs courts: specifically the proper classification of the subject surgical cameras and related apparatus in view of the Court of International Trade’s decision in Sony Electronics, Inc., v. United States, 35 Int’l Trade Rep. (BNA) 2395 (Ct. Int’l Trade Dec. 23, 2013).
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 relevant 2011 HTSUS provisions are as follows:
8525 Transmission apparatus for radio-broadcasting or television, whether or not incorporating reception apparatus or sound recording or reproducing apparatus; television cameras, digital cameras and video camera recorders:
8525.80 Television cameras, digital cameras and video camera recorders:
8525.80.30 Television cameras: Other
8525.80.40 Digital still image video cameras
8525.80.50 Other
Because the classification of the subject cameras involves an analysis beyond the four-digit heading level, GRI 6 is implicated. GRI 6 states:
For legal purposes, the classification of goods in the subheading 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.
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 Harmonized System and are generally indicative of the proper interpretation of the heading. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The EN to 85.25, subsection (B), provides for Television Cameras, Digital Cameras and Video Camera Recorders. Therein it states:
This group covers cameras that capture images and convert them into an electronic signal that is:
Transmitted as a video image to a location outside the camera for viewing or remote recording (i.e., television cameras); or
Recorded in the camera as a still image or as a motion picture (i.e., digital cameras and video camera recorders).
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Television cameras … [include] (e.g., television cameras for television studios or for reporting, those used for industrial or scientific purposes, in closed circuit television (surveillance) or for supervising traffic). [Emphasis in original] These cameras do not have any inbuilt capability of recording images. [Emphasis added]
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In digital cameras and video camera recorders, images are recorded onto an internal storage device or onto media (e.g., magnetic tape, optical media, semiconductor media or other media of heading 85.25). They may include an analogue/digital converter (ADC) and an output terminal which provides the means to send images to units of automatic data processing machines, printers, televisions or other viewing machines…
In Sony Electronics, Inc., v. United States, 35 Int’l Trade Rep. (BNA) 2395 (Ct. Int’l Trade Dec. 23, 2013), the CIT held that the proper classification of the Sony “NSC-GCI Net-Sharing Cam” is in subheading 8525.80.40, HTSUS (2007), as a “digital still image video camera.” The Sony camera was a “Handycam,” (e.g. handheld) personal device capable of capturing still images at five different resolutions and moving images at two resolutions at several different frames per second rates. The camera recorded the images digitally, saving still images in.jpg format and moving images in .mp4 format. Later, the user would plug the handycam into a personal computer (PC) via a universal serial bus (USB) cable and select which photos or video the user sought to download onto a computer or upload on the web. Additionally, the NSC-GC1 had 2MB of user accessible internal memory to hold the stored images and was designed to incorporate a removable flash memory stick (sold separately) for the storage of more than small numbers of still images or short durations of moving images. In other words, the Sony camera had internal memory storage for the images prior to their being downloaded onto a computer or uploaded onto the web.
The subject camera, however, captures images in “real time” and transmits the images (e.g. those of a surgical procedure) to a location outside the camera for viewing or remote recording. There is no inbuilt recording or storage capacity. CBP has consistently classified cameras that capture video images in real time, which are transmitted to locations outside the camera for viewing, as television-type cameras of subheading 8525.80.30, HTSUS. See NY N245636, dated September 24, 2013, (classifying the “Freeway CAM Digital License Plate Recognition Camera” which captures real-time moving images and transmits them to a location outside the camera for viewing and recording and does not have any inbuilt recording capability). See also HQ 966172, dated June 4, 2003, (the capability of buffering (temporarily storing) still images, in sequential order to transmit them from the camera to an ADP (automatic data processing) machine, was not internally recording those images in the capacity of a digital still image video camera); NY N232616, dated September 13, 2012 (classifying a television-type camera that captured images of internal pipelines in real time and transmitted them to a location outside the camera for remote viewing and recording, with no inbuilt video recording capability in subheading 8525.80.30, HTSUS); NY N078845, dated November 3, 2009 (classifying a mobile surveillance system with a controllable digital camera that recorded images in real time but which were displayed at a remote site or recorded through a digital video recorder (DVR) but no built-in recording capability in subheading 8525.80.30, HTSUS); and see NY N007771, dated March 19, 2007 (classifying a camera used for surveillance/security purposes in subheading 8525.80.30, HTSUS because it captured live images in real time for transmission to a video monitor. This camera had NTSC [television] signal capability, but no storage or recording capability).
GRI 3(b) discusses “sets” for tariff classification purposes. Therein it states: 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. The EN (VIII) to GRI 3(b) states:
(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, weight or value, or by the role of a constituent material in relation to the use of the goods.
The EN (X) to GRI 3(b) states:
(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;
(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 without repacking (e.g. in boxes or cases or on boards).
The camera and the camera handle are prima facie classifiable in different headings. The two components are used together in a surgical or medical suite during a medical procedure, to move or position the camera which is capturing images related to a medical procedure in real time. Lastly, in its condition as imported, the two are put up together without the need to be repacked. Therefore, it satisfies all three requirements to the EN (X) to GRI 3(b) as “goods put up in sets for retail sale”. As between the camera and the camera handles, the camera imparts the essential character of this set, because it outweighs the handles, is of a far greater value than the handles, and is more technologically advanced than the handles. Therefore, when imported packaged together the camera and camera handles are a “set” and will be classified according to the camera as its essential character. The camera is fully described by subheading 8525.80.30, HTSUS, and Note 1(m) to Section XVI excludes classification in heading 9018, HTSUS.
Counsel argues that the subject cameras may be classified as a part of the surgical lighting system under heading 9018, HTSUS. However, Note 1(h) to Chapter 90 states that cameras of heading 8525, (television cameras, digital cameras and video camera recorders) are excluded from classification therein. Furthermore, Note 2(a) to Chapter 90 directs goods of Chapter 85 to classification therein, in all cases. As such, they will be addressed separately, and are not classified in heading 9018, HTSUS.
HOLDING:
By application of GRI 6 and GRI 3(b), the camera and camera handle imported together is classifiable in heading 8525, HTSUS, and is specifically provided for in 8525.80.30, HTSUS, as “Transmission apparatus for radio-broadcasting or television, whether or not incorporating reception apparatus or sound recording or reproducing apparatus; television cameras, digital cameras and video camera recorders: Television cameras, digital cameras and video camera recorders: Television cameras: Other.” The general, column one duty rate is 2.1% ad valorem.
Since the rate of duty under the classification indicated above is the same as the liquidated rate, you are instructed to DENY the protest with regards to the camera and camera handles packaged together, pursuant to the above analysis.
A copy of this ruling should be attached to the CBP Form 19 and provided to the protestant as part of the notice of action on the protest. Any re-liquidation of the entries in accordance with the decision must be accomplished prior to mailing the decision.
Sixty days from the date of the decision the Office of International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the U.S. Customs and Border Protection 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