CLA-2 CO:R:C:M 952554 MBR
District Director
U.S. Customs Service
P.O. Box 1490
St. Albans, Vermont 05478
RE: Protest No. 0201-9X-XXXXXX; ECSL200 Optoelectronic Signal
Converting Units; Control or Adapter Units; Automatic Data
Processing Machine; Parts; ROSA; TOSA; HQ 951331; HQ 952659
Dear District Director:
This is in response to Protest Number 0201-9X-XXXXXX, dated
April 2, 1992, regarding the classification of the ECSL200
Optoelectronic Signal Converting Unit and parts thereof, under the
Harmonized Tariff Schedule of the United States (HTSUS).
We have recently reconsidered the classification of Local Area
Network (LAN) equipment. See HQ 951331, dated September 18, 1992,
as modified by HQ 952659, dated October 7, 1992.
FACTS:
The ECSL200 is a specially designed, assembled, optoelectronic
signal converting module. "ECSL200" stands for "Early Corporate
Serial Link" which operates at a nominal data stream bit rate of
200 megabits per second. The final printed circuit board (PCB)
assemblies with attached ECSL200 modules are used exclusively in
separately housed units (digital processing units, control units,
disk storage units, etc.) of large mainframe ADP machines which are
in the form of systems.
The IBM ECSL200 module contains two specifically designed
electroptic subassemblies (used solely in the ECSL units). One of
the subassemblies is an electroptic receptor referred to as a
Receiver Optical Subassembly (ROSA). The other is an electroptic
coherent electromagnetic radiation (amplified light) emitter
referred to as a Transmitter Optical Subassembly (TOSA).
This protest governs both the importation of the ROSA and TOSA
parts separately, and the importation of a complete ECSL200 module.
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ISSUE:
Whether the IBM ECSL200 module and the TOSA and ROSA parts are
classifiable as claimed under heading 8471, HTSUS, which provides
for ADP machines and units thereof, or under heading 8473, HTSUS,
which provides for parts of automatic data processing machines, or
under heading 8517, HTSUS, as entered, which provides for
telegraphic apparatus?
LAW AND ANALYSIS:
Legal Note 5(B) to chapter 84, HTSUS, provides guidance
regarding the classification of automatic data processing machines.
It states:
Automatic data processing machines may be in the form of
systems consisting of a variable number of separately housed
units. A unit is to be regarded as being a part of the
complete system if it meets all of the following conditions:
(a) It is connectable to the central processing unit either
directly or through one or more other units; and
(b) It is specifically designed as part of such a system (it
must, in particular, unless it is a power supply unit,
be able to accept or deliver data in a form (code or
signals) which can be used by the system).
We agree that the ECSL200 module is essential to the ADP
systems with which they are integrated because, when they are
assembled with the PCB assembly, they perform ADP data acquisition
and conversion and transmission.
The Harmonized Commodity Description and Coding System
Explanatory Notes (ENs), pages 1299-1300, describe separately
presented ADP units as follows:
This heading also covers separately presented constituent
units of data processing systems. Constituent units are those
defined in Parts (A) and (B) above as being parts of a
complete system.
Apart from central processing units and input and output
units, examples of such units include:
(4) Control and adaptor units such as those to effect
interconnection of the central processing unit to other
digital data processing machines, or to groups of input
or output units which may comprise visual display units,
remote terminals, etc.
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Although these machines have certain subsidiary optical
elements, such as a lens, they are not themselves "essentailly
optical elements" [chapter 90, Legal Note 1(f)].
It is our opinion that the completed ECSL200 module does have
the essential character of an ADP signal converting unit since it
performs the actual signal conversion, transmission, and reception,
and as such is classifiable under heading 8471, HTSUS, pursuant to
chapter 90, Legal Note 2. Therefore, since the TOSA and ROSA parts
themselves do not have the essential character of a finished ADP
unit, they are classifiable under heading 8473, HTSUS, which
provides for parts of ADP machines.
HOLDING:
The IBM ECSL200 TOSA and ROSA optoelectronic ADP signal
converting parts are classifiable in subheading 8473.30.40, HTSUS,
which provides for: "[p]arts and accessories (other than covers,
carrying cases and the like) suitable for use solely or principally
with the machines of headings 8469 to 8472: [p]arts and accessories
of the machines of heading 8471: [n]ot incorporating a cathode ray
tube." The rate of duty is Free.
The complete IBM ECSL200 module performs ADP signal conversion
and has the essential character of an ADP unit. Therefore, it is
classifiable under subheading 8471.99.15, HTSUS, which provides
for: "[a]utomatic data processing machines and units thereof:
[o]ther: [o]ther: [c]ontrol or adapter units." The rate of duty
is Free.
The protest should be allowed 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