CLA-2 CO:R:C:M 951288 MBR
District Director
U.S. Customs, Suite 1001
300 South Ferry St. Terminal Is.
San Pedro, CA 90731
RE: Protest No. 2704-91-105194; Epson America, Inc.; Liquid
Crystal Diode; LCD; Signaling
Dear Sir:
This is our reply to Protest Number 2704-91-105194, dated
December 19, 1991, regarding classification of liquid crystal
diodes, under the Harmonized Tariff Schedule of the United States
(HTSUS).
FACTS:
EPSON's dot matrix LCD modules consist of a newly developed
TN and STN positive/reflective type liquid crystal display with
high-contrast, wide-viewing angle and wide operating temperature
range, C-MOS LSI driver and controller. EPSON's easy-installed LCD
modules have a multiple instruction set, and wide variety of
applications. The provided literature lists the following
applications: portable computers, hand-held terminals, computer
terminals, word processor/typewriters, instrument devices, POS
terminals, telecommunications terminals, and synthesizers. The EA
and EG-X Series have built-in DATA RAM for display data
storage/refresh on board which provide for easy microprocessor
interface with most CPUs. The features of the EA Series are as
follows: alphanumeric and special symbols, 5 x 7 dot matrix with
cursor, 5 x 11 dot matrix without cursor, 5 x 12 dot matrix without
cursor, and 16 to 80 character display. The EG Series features are
as follows: 1/64 to 1/242 multiplexing, graphics and characters,
special controller. The EG-X Series provides easy connection to
the bus line of most 4-bit/8-bit microcomputers, and has both
graphics and characters.
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ISSUE:
Are liquid crystal displays classified under heading 8531,
HTSUS, which provides for electric sound or visual signaling
apparatus, or under heading 8471, HTSUS, which provides for ADP
output devices, or under heading 9013, HTSUS, which provides for
liquid crystal devices n.s.p.f., under the Harmonized Tariff
Schedule of the United States (HTSUS)?
LAW AND ANALYSIS:
The General Rules of Interpretation (GRI's) to the HTSUS
govern the classification of goods in the tariff schedule. GRI 1
states, in pertinent part:
...classification shall be determined according to the terms
of the headings and any relative section or chapter notes...
Liquid crystal displays (LCDs) are prima facie classifiable
under the following subheadings:
8531 Electric sound or visual signaling apparatus (for example,
bells, sirens, indicator panels...
8531.20.00 Indicator panels incorporating liquid crystal
devices (LCD's) or light emitting diodes (LED's)
* * * * * * * * * * * * * *
9013 Liquid crystal devices not constituting articles provided for
more specifically in other headings
9013.80.60 Other devices, appliances and instruments: Other
* * * * * * * * * * * * * *
8471 Automatic data processing machines and units thereof
8471.92.80 Other: Input or output units...: Other: Other: Units
suitable for physical incorporation into automatic
data processing machines or units thereof
* * * * * * * * * * * * * *
Heading 8531, HTSUS, provides for electric sound or visual
signalling apparatus. Therefore, to be classifiable in this
heading, the apparatus must be designed for "signalling."
The Harmonized Commodity Description and Coding System
Explanatory Notes (ENs) to heading 8531, HTSUS, page 1381, are
fairly descriptive and restrictive as to the types of signalling
indicator panels and the like must perform in order to be
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classifiable there. It states: "[t]hese are used (e.g., in
offices, hotels and factories) for calling personnel, indicating
where a certain person or service is required, indicating whether
a room is free or not. They include:
(1) Room indicators. These are large panels with number
corresponding to a number of rooms...
(2) Number indicators. The signals appear as illuminated
figures on the face of a small box; in some apparatus of
this kind the calling mechanism is operated by the dial
of a telephone. Also clock type indicators in which the
numbers are indicated by a hand moving round a dial.
(3) Office indicators, for example, those used to indicate
whether the occupant of a particular office is free or
not...
(4) Lift indicators. These indicate, on an illuminated
board, where the lift is and whether it is going up or
down. etc.
Therefore, only those LCDs which are limited by design and
function to that of "signaling," are classifiable in heading 8531,
HTSUS. It is Customs position that the Epson EA-D16125AR-S (2
lines of 16 characters) is restricted by its limited operational
capabilities to that of signalling functions, and is classifiable
as entered under heading 8531, HTSUS. However, due to the
expansive character capabilities of the EG-2401S-ER-1 (1 line with
64 characters) and EG-7500B-NS-1 (1 line with 200 characters) a
principle use of signalling cannot be supported.
Furthermore, none of the instant LCDs would be utilized as
automatic data processing machine output devices. ADP LCD flat
panel displays are characteristically significantly larger and
contain numerous lines of characters.
Heading 8531, HTSUS, and heading 8471, HTSUS, are both use
provisions subject to Additional U.S. Rule of Interpretation 1.(a)
which states that: "a tariff classification controlled by use
(other than actual use) is to be determined in accordance with the
use in the United States at, or immediately prior to, the date of
importation, of goods of that class or kind to which the imported
goods belong, and the controlling use is the principal use."
Therefore, unless a principal use for signalling (heading 8531,
HTSUS) or ADP output (heading 8471, HTSUS) can be established
satisfactorily either by design limitation or other reliable means,
LCD displays are classifiable in subheading 9013.80.60, HTSUS,
which provides for: "[l]iquid crystal devices not constituting
articles provided for more specifically in other headings: [o]ther
devices, appliances and instruments: [o]ther."
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E.M. Chemicals v. United States, Appeal No. 90-1141, Cust.
Bul. Vol. 24, No. 51, (1990), 728 F. Supp. 723 (1989), held that
liquid crystals were classifiable under item 685.70, under the
TSUS. However, there has been a significant change in the relevant
tariff provisions under the HTSUS, and LCDs have been
technologically developed for a myriad of uses, many of which
cannot be said to be for "signaling."
The importer argues that LCD modules containing "row and
column drivers" would be precluded from classification under
heading 9013, HTSUS. However, the row and column drivers activate
the LCD crystals with an electrical charge, causing the crystal to
appear visibly. Thus, the row and column drivers are a part of the
LCD, and do not alter the essential character of the LCD. They are
in fact the electrical connections to the LCD. The ENs to heading
9013, HTSUS, page 1478, state:
(1) Liquid crystal devices consisting of a liquid crystal
layer sandwiched between two sheets or plates of glass
or plastics, whether or not fitted with electrical
connections, presented in the piece or cut to special
shapes and not constituting articles described more
specifically in other headings of the Nomenclature.
Therefore, LCDs fitted with row and column drivers are
classifiable in heading 9013, HTSUS, as long as they are not
articles described more specifically in other headings.
HOLDING:
The Epson EA-D16125AR-S (2 lines of 16 characters) is
restricted by its limited operational capabilities to that of
signalling functions, therefore, it is classifiable as entered in
subheading 8531.20.00, HTSUS, which provides for: "[e]lectric sound
or visual signaling apparatus (for example, bells, sirens,
indicator panels...: [i]ndicator panels incorporating liquid
crystal devices (LCD's) or light emitting diodes (LED's)."
Due to the expansive character capabilities of the EG-2401S-
ER-1 (1 line with 64 characters) and EG-7500B-NS-1 (1 line with 200
characters) a principle use of signalling is not present.
Therefore, they are classifiable in subheading 9013.80.60, HTSUS,
which provides for: "[l]iquid crystal devices not constituting
articles provided for more specifically in other headings: [o]ther
devices, appliances and instruments: [o]ther."
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The protest should be denied in full. A copy of this decision
should be attached to the Customs Form 19 and provided to the
protestant as part of the notice of action on the protest.
Sincerely,
John Durant, Director
Commercial Rulings Division