CLA-2 CO:R:C:M 955416 RFA
Mr. Richard Ormsby
Ormsby International Customs House Brokers
765 Route 83
Suite 120
Bensenville, IL 60106
RE: High Frequency Crystal Oscillators; Hybrid Integrated
Circuits; EN 85.42; Legal Note 5 to Chapter 85
Dear Mr. Ormsby:
In a letter dated October 28, 1993, to the Regional
Commissioner of Customs in New York, you inquired on behalf of
Toyocom USA, Inc., as to the tariff classification of certain
crystal oscillators under the Harmonized Tariff Schedule of the
United States (HTSUS). As stated in our letter to you on March
15, 1994, your letter was referred to this office for a response.
Further, because there are open entries and protests involving
this merchandise pending with Customs in Chicago, we are treating
your letter as a request for internal advice.
FACTS:
The merchandise is described as TCO-series high frequency
crystal oscillators [model series: 312, 730, 205, 919, 512, 519,
909, 612, 613, 615, 635, 627, 632, 101, 103, 109, 930, 940, and
970] which are used in various kinds of communication equipment,
test equipment, measurement equipment, and other electronic
equipment as a precision frequency reference source. The crystal
oscillators consist of capacitors, resistors, a crystal
resonator, and integrated circuits bonded to a single alumina/
ceramic substrate using solder or conductive epoxy. The crystal
oscillators are hermetically sealed in a metal package. Each
device is made using a thin or thick film process.
Samples of the following TCO models were provided to Customs
in Chicago, in August 1994, for examination: 512, 629, 635, 205,
101, 612, 312, 109, 103, 919, 519, 909, and 627.
ISSUE:
Are the TCO-series high frequency crystal oscillators
classifiable as hybrid integrated circuits under the HTSUS?
LAW AND ANALYSIS:
Classification of merchandise under the HTSUS is in
accordance with the General Rules of Interpretation (GRI's). GRI
1 provides that classification shall be determined according to
the terms of the headings and any relative section or chapter
notes.
The Harmonized Commodity Description and Coding System
Explanatory Notes (EN) constitute the Customs Cooperation
Council's official interpretation of the HTSUS. While not
legally binding, 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 54 Fed.Reg. 35127,
35128 (August 23, 1989). EN 85.42(I)(2), page 1400-1401,
defines hybrid integrated circuits as follows:
These are microcircuits built upon an insulating
substrate on which a thin or thick film circuit has
been formed. This process allows certain passive
elements (resistors, capacitors, interconnections,
etc.) to be produced at the same time. However, to
become a hybrid integrated circuit of this heading,
semiconductors must be incorporated and mounted on the
surface, either in the form of chips, whether or not
encased, or as encased semiconductors (e.g., in
specially designed miniature casings). Hybrid
integrated circuits may also contain separately
produced passive elements which are incorporated into
the basic film circuit in the same way as the
semiconductors. Usually these passive elements are
components such as capacitors, resistors or inductors
in the form of chips.
* * * *
The components forming a hybrid integrated circuit
must be combined to all intents and purposes
indivisibly, i.e., though some of the elements could
theoretically be removed and replaced, this would be a
long and delicate task which would be uneconomic under
normal manufacturing conditions.
According to the information submitted, the TCO-series
crystal oscillators contain passive elements such as capacitors
and resistors, as well as active elements, such as integrated
circuits, which are bonded to a single alumina/ceramic substrate.
Each device is made using a thin or thick film process.
The submitted samples were sent to the Customs Laboratory in
Chicago for examination. Customs Laboratory Report Number 3-94-31395-012, dated August 8, 1994, states that: there are passive
and active elements on the boards; the semiconductors are
incorporated and mounted on the surface; and the components
cannot be easily removed and replaced. Based upon this
information and examination of the submitted samples, we find
that the TCO-series crystal oscillators 512, 629, 635, 205, 101,
612, 312, 109, 103, 919, 519, 909, and 627, meet the definition
of a hybrid integrated circuit as set out by EN 85.42(I)(2). See
also Legal Note 5(b)(ii) to chapter 85, HTSUS, which provides as
follows:
For the purposes of headings 8541 and 8542:
* * * * *
(b) "Electronic integrated circuits and microassemblies" are:
* * * * *
(ii) Hybrid integrated circuits in which passive elements
(resistors, capacitors, interconnections, etc.)
obtained by thin- or thick- film technology and active
elements (diodes, transistors, monolithic integrated
circuits, etc.) obtained by semiconductor technology,
are combined to all intents and purposes indivisibly,
on a single insulating substrate (glass, ceramic,
etc.). These circuits may also include discrete
components;
* * * * *
For the classification of the articles defined in this
note, headings 8541 and 8542 shall take precedence over
any other heading in the tariff schedule which might
cover them by reference to, in particular, their
function.
According to available information, we believe the model
series which were not submitted for examination are also hybrid
integrated circuits. Therefore, the TCO-series crystal
oscillators are classifiable under subheading 8542.20.00, HTSUS,
which provides for: "[e]lectronic integrated circuits and
microassemblies. . . : [h]ybrid integrated circuits."
HOLDING:
The TCO-series crystal oscillators are classifiable under
subheading 8542.20.00, HTSUS, which provides for: hybrid
integrated circuits. The general, column one rate of duty is
free.
Sincerely,
John Durant, Director
Commercial Rulings Division
cc: District Director, Chicago
Attn: Kristine Sowa