CLA-2 RR:TC:MM 957491 LTO
Port Director
U.S. Customs Service
610 S. Canal Street
Chicago, Illinois 60607
RE: IA 67/94; keyboards, keypads and keytops; GRI 2(a); section XVI, note 2; chapter 84, note 5; heading 8471, 8485, 8537, 8538, 8548; EN 84.69; HQs 082461, 087513, 955868, 958709
Dear Port Director:
This is in response to your memorandum dated December 12,
1994 (MAN-1-CO:CH:CT310 KGS), forwarding a letter dated August
14, 1994, from a law firm requesting the classification of
certain keyboards, keypads and keytops, which are imported by
Preh Electronics ("Preh"), under the Harmonized Tariff Schedule
of the United States (HTSUS). In preparing this ruling,
consideration was also given to supplemental submissions from
counsel dated August 8, 1995, and March 12, 1996.
FACTS:
The articles in question are keyboards, keypads and keytops,
several samples of which were submitted. The keyboards are
imported in three stages of completion: (1) bare, with no
housing, no interface electronics and normally with unprinted
keytops; (2) semi-finished, with interface electronics but no
housing; and (3) complete, including both housing and interface
electronics. The keypads, which are small keyboards or
supplementary keyboard keys, are imported with no housing, no
interface electronics and normally with unprinted keytops. The
keytops are imported both printed and unprinted.
- 2 -
Sample A1 is a "rows and columns" keyboard without a housing
or interface electronics. The keyboard has programmable keys
that can be customized, for example, with relegendable single,
double or quad keytops (the 128 single keytops on sample A1 are
unprinted). Sample A1, therefore, can be configured for a
variety of applications, including "point-of-sale" (POS).
Sample A2 is a QWERTY-style keypad without a housing or
interface electronics. It has six function keys (S1-S6) and also
includes the following keys: "ESC," "TAB," "CTRL," "ALPHA LOCK,"
"REP" and "LINE FEED." It does not have a "numerical" keypad.
Sample A2 does not appear to be configured for any particular
application.
Sample A3 is a customized, QWERTY-style keypad without a
housing or interface electronics. The keypad, which also has
several special function keys, is configured for a machine tool
application. Sample A3 includes the following printed keytops:
Coolant; Tool in/out; Turret CCW; Turret CW; etc. The same
keypad can also be configured for a POS application by simply
changing certain keytops.
Sample B is a QWERTY-style keyboard with interface
electronics but no housing. It appears to be a condensed version
of a standard PC keyboard. It does not include separate "page
up," "page down," "end" or "home" keys. These keys appear on the
"numerical" keypad. The keyboard also includes twelve function
keys and three light-emitting diodes (LEDs), which appear to
correspond to the "numbers lock," "caps lock" and "scroll lock"
portion of a standard PC keyboard.
Sample C1, the Preh Commander PC-AT3, is a complete, QWERTY-style keyboard with a housing and interface electronics. The
Commander is a multifunctional compact keyboard with 88 key
positions, 19 mm (3/4 inch) keytop spacing and many programmable
function keys. The Commander's heavy duty construction is
designed to "thrive in areas subject to extreme moisture,
corrosive vapor, dust, dirt and overenthusiastic operators."
Sample C1, therefore, has many industrial, laboratory and medical
technology applications.
Sample C3, the Preh PC-POS keyboard, is a complete, QWERTY-style keyboard with housing and interface electronics. The PC-POS has additional (programmable) "rows and columns" keys and a
magnetic stripe reader that makes it particularly suitable for
POS applications. The PC-POS also includes an additional
"wedge," which provides the capability to connect different
peripherals, such as a laser scanner. - 3 -
ISSUE:
Whether the keyboards and keypads are classifiable as input
units for automatic data processing (ADP) machines under heading
8471, 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 that "for legal purposes, classification
shall be determined according to the terms of the headings and
any relative section or chapter notes . . . ."
While Preh imports a wide variety of keyboards and keypads,
we will deal specifically with the classification of the samples
provided. The samples were lettered and/or numbered by counsel.
Part numbers were not provided. Accordingly, the description,
rather than the sample letter/number, controls. The general
principles involved in the classification of these samples can be
applied to the classification of all keyboards and keypads (i.e.,
a keyboard similar to sample A1 should be classified in a similar
fashion). Further, we will provide the classification of these
devices for the date of the internal advise request, 1994, as
well as, under the current tariff schedule.
A. Keyboards and Keypads
1994
The headings under consideration are as follows:
8471 Automatic data processing machines and units
thereof . . .
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 . . .
The above heading text was taken from the 1994 version of
the HTSUS, although it remains substantially similar in 1996.
Note 5(B) to chapter 84, HTSUS (1994), establishes
guidelines for the classification of separately presented units
of ADP machines. The note provides as follows:
- 4 -
(B) 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).
Note 5 to chapter 84, HTSUS (1994), also includes the
following limitation:
Heading 8471 does not cover machines incorporating or working in conjunction with an automatic data
processing machine and performing a specific function.
Such machines are classified in the headings
appropriate to their respective functions or, failing
that, in residual headings.
Samples A1, A2, A3 and C3 (the PC-POS) are not specifically
designed as parts of ADP systems, are used with machines
performing a specific function, and therefore, cannot be
classified as ADP units. Samples A1, A2 and A3 are not the same
size as a "standard" PC keyboard (laptop or desktop), and there
is no indication that they can be configured for such use.
Sample A3, in particular, is customized for use with a machine
tool that incorporates an ADP machine, and includes the following
printed keytops: Coolant; Tool in/out; Turret CCW; Turret CW;
etc. Sample C3 has additional (programmable) rows and columns
keys and a magnetic stripe reader that makes it particularly
suitable for POS applications. It also includes an additional
"wedge," which provides the capability to connect different
peripherals, such as a laser scanner. These samples cannot,
according to note 5, be classified as units for ADP machines
under heading 8471, HTSUS (1994). See, e.g., HQ 955868, dated
May 20, 1994 (wherein a POS terminal incorporating an ADP machine
was classified as a cash register under heading 8470, HTSUS); HQ
087513, dated November 5, 1990 (wherein a laser machinery center
with a "computer numerical control" (CNC) was classified as a
laser machine tool under heading 8456, HTSUS).
Samples A1, A2, A3 and C3 are classifiable under heading - 5 -
8537, HTSUS. Each keyboard and keypad consists of a base
equipped with a number of switches that generate electrical
signals upon contact, each key activating the entry of a specific
letter, number, symbol, etc. Specifically, these keyboards and
keypads are classifiable under subheading 8537.10.90, HTSUS
(1994), which provides for other bases, equipped with two or more
apparatus of heading 8535 or 8536, HTSUS, for electric control or
the distribution of electricity, for a voltage not exceeding
1,000 V. For other rulings concerning the classification of
various keyboards under this heading, see, e.g., HQ 082461, dated
February 23, 1990, (wherein a keyboard without interface
electronics for a desktop ADP machine was classified under
heading 8537, HTSUS, rather than heading 8471, HTSUS, because it
did not meet the definition for an ADP unit); HQ 958709, dated
February 6, 1996, which revoked HQ 087362, dated February 19,
1991 (wherein a keyboard for a cellular telephone, with no
housing or interface electronics, was classified under heading
8537, HTSUS, rather than under heading 8471, HTSUS (according to
note 2(a) to section XVI, HTSUS)).
Samples B and C1, on the other hand, are connectable to the
central processing unit, and are specifically designed as parts
of an ADP system. Sample B has many (somewhat condensed)
features that are similar to a standard PC keyboard. It is a
QWERTY-style keyboard with interface electronics but no housing.
It has twelve function keys and includes three LEDs, which appear
to correspond to the "numbers lock," "caps lock" and "scroll
lock" portion of a standard PC keyboard.
Sample C1, the Preh Commander PC-AT3, is a multifunctional
compact keyboard with 88 key positions, 19 mm (3/4 inch) keytop
spacing and many programmable function keys. The C1 is a
complete keyboard with housing and interface electronics.
Although the C1's heavy duty construction is designed to "thrive
in areas subject to extreme moisture, corrosive vapor, dust, dirt
and overenthusiastic operators," it is used principally as a part
of an ADP system.
Accordingly, both sample B and C1 are classifiable as ADP
input units under heading 8471, HTSUS. Specifically, they are
classifiable as keyboards for ADP machines under subheading
8471.92.20, HTSUS (1994). Because sample B does not contain its
housing, classification is based on GRI 2(a), HTSUS.
1996
In 1996, note 5 to chapter 84, HTSUS, and the structure of
heading 8471, HTSUS, was substantially modified. Note 5(B) to - 6 -
chapter 84, HTSUS (1996), now provides as follows:
(B) Automatic data processing machines may be in the
form of systems consisting of a variable number of separate units. Subject to paragraph (E) below, a
unit is to be regarded as being a part of a
complete system if it meets all the following conditions:
(a) It is of a kind solely or principally used in
an automatic data processing system;
(b) It is connectable to the central processing
unit either directly or through one or more
other units; and
(c) It is able to accept or deliver data in a
form (codes or signals) which can be used by
the system.
This portion of note 5(B) remained essentially the same,
although the note now requires that a unit must be "solely or
principally used" in an ADP system, rather than "specifically
designed as part of such a system." This change negates any
ambiguity that may have resulted from the use of the term "part"
in the definition and classification of "ADP units," which are
not "ADP parts" (parts of ADP machines are classifiable under
heading 8473, HTSUS).
Note 5 to chapter 84, HTSUS (1996), also includes the
addition of note 5(D), which provides that "[p]rinters,
keyboards, X-Y coordinate input devices and disk storage units
which satisfy the conditions of paragraphs (B)(b) and (B)(c)
above, are in all cases to be classified as units of heading
8471." Counsel for Preh contends that this addition requires the
classification of all keyboards and keypads as ADP input units
under heading 8471, HTSUS. We disagree.
The addition of note 5(D) "slightly" expands the scope of
heading 8471, HTSUS, to include printers, keyboards, X-Y
coordinate input devices (mouse, joystick, etc.) and disk storage
units "which, though normally used with ADP machines, could also
be used with word processors and other office machines." See
World Customs Organization (WCO), Amendments to the Harmonized
System Nomenclature, effective from 1 January 1996; Annex I to
Doc. 36.250 E (RSC/3/Sept. 90); Annex E to Doc. 36.600 E
(HSC/7/Apr. 91). See also Harmonized Commodity Description and
Coding System Explanatory Note 84.69 (concerning the
classification of certain printers designed to be connected to
other typewriters, word-processing machines, ADP machines, etc.). - 7 -
The 1996 amendments require that printers, keyboards, X-Y
coordinate input devices and disk storage units that are
"capable" of being connected (directly or indirectly) to the CPU
of an ADP machine and are able to accept or deliver data in a
form which can be used by the system be classified under
heading 8471, HTSUS. However, while "principal use" with an ADP
machine is not required, the 1996 amendments to note 5 to chapter
84, HTSUS, were not intended to expand the scope of heading 8471,
HTSUS, to include all printers, keyboards, X-Y coordinate input
devices and disk storage units.
Note 5(D) must be read in light of note 5(E) to chapter 84,
HTSUS. Note 5(B) to chapter 84, HTSUS, provides that a unit is
to be regarded as being a part of an ADP system if it meets all
the listed conditions, "subject to note 5(E) to chapter 84,
HTSUS." Note 5(E), which prior to 1996 was found following notes
5(A) and 5(B) under note 5 (see above), provides that "[m]achines
performing a specific function other than data processing and
incorporating or working in conjunction with an automatic data
processing machine are to be classified in the headings
appropriate to their respective functions or, failing that, in
residual headings (addition to 1996 text in bold face)." Thus,
while note 5(D) negates the sole or principal use requirement
when considering the classification of printers, keyboards, X-Y
coordinate input devices and disk storage units, note 5(E)
provides a separate prerequisite to the classification of any ADP
machine and, therefore, ADP unit. To be classified as an ADP
unit, a device must be used with a machine that is considered,
for classification purposes, an ADP machine. See chapter 84,
note 5(A), HTSUS (1994/1996) (defining "automatic data processing
machines" for purposes of heading 8471, HTSUS).
As stated above, samples A1, A2 and A3 cannot be used with a
device that is classifiable as an ADP machine under heading 8471,
HTSUS. These samples cannot, according to note 5(E) (1996), be
classified as units for ADP machines under heading 8471, HTSUS.
Rather, they are classifiable (as in 1994) under subheading
8537.10.90, HTSUS (1996).
Samples B and C1 remain classifiable (as in 1994) as ADP
input units under heading 8471, HTSUS. Specifically, they are
classifiable as keyboards for ADP machines under subheading
8471.60.20, HTSUS (1996). Because sample B does not contain its
housing, classification is based on GRI 2(a), HTSUS.
The classification of sample C3 (the PC-POS), in light of
the 1996 amendments, is a more difficult determination. However, - 8 -
it is our opinion that sample C3, although it can be connected to
a standard, desktop PC, cannot be classified as an ADP input unit
under heading 8471, HTSUS. Although "principal use" is not
required, some degree of "capacity" for use with an ADP machine,
in light of the purpose of the 1996 amendments, must be required.
To be "capable" of being used with an ADP machine, a device must
be actually, practically and commercially fit for such use. Such
"capacity" requires more than a casual, incidental, exceptional
or possible use.
Sample C3 has additional (programmable) rows and columns
keys and a magnetic stripe reader that makes it particularly
suitable for POS applications. It also includes an additional
"wedge," which provides the capability to connect different
peripherals, such as a laser scanner. Because of its special
design, sample C3 costs a great deal more than a "standard"
desktop keyboard (approximately ten times more than the
"standard" keyboard). Moreover, sample C3 provides certain
features (i.e., many programmable function keys; "wedge") that
would not be used if connected to a standard, desktop PC. Thus,
while sample C3 can be connected to a standard, desktop PC, it is
highly unlikely that one would purchase it for such use, as it is
not practically and commercially fit for such use. While counsel
for Preh has provided pictures of sample C3 connected to a
standard, desktop PC, it is our opinion that any such use would
be merely "casual, incidental, exceptional or possible." This
type of use was not the type contemplated by the amendments to
chapter 84, note 5, HTSUS. Accordingly, sample C1, like samples
A1, A2 and A3, is classifiable under subheading 8537.10.90,
HTSUS.
B. Printed and Unprinted Keytops
Finally, we must consider the classification of the printed
and unprinted keytops, which are parts of the keyboards with
which they are used. Note 2 to section XVI, HTSUS, governs the
classification of parts within chapters 84 and 85, HTSUS. Note
2(a) is inapplicable in this instance, because the keytops are
not "goods included" in any chapter 84 or 85 heading. Note 2(b)
(1996) provides, in pertinent part, that "[o]ther parts, if
suitable for use solely or principally with a particular kind of
machine, or with a number of machines of the same heading . . .
are to be classified with the machines of that kind or in heading
8409, 8431, 8448, 8466, 8473, 8503, 8522, 8529 or 8538 as
appropriate (addition to 1996 text in bold face)." Accordingly,
keytops that are principally used with the keyboards (or keypads)
of heading 8471, HTSUS, are classifiable, as parts, under heading
8473, HTSUS, while keytops that are principally used with the - 9 -
keyboards (or keypads) of heading 8537, HTSUS, are classifiable,
as parts, under heading 8538, HTSUS.
The principal use of certain printed keytops is readily
ascertainable. For example, sample A3, which was customized for
use with a particular machine tool, includes the following
printed keytops: Coolant; Tool in/out; Turret CCW; Turret CW;
etc. These keytops would be classifiable, as parts, under
heading 8538, HTSUS, specifically under subheading 8538.90.80,
HTSUS (1994/1996). However, the principal use of the unprinted
keytops and the "interchangeable" printed keytops (keytops that
can be found on all of Preh's keyboards or keypads, such as, the
"QWERTY" keytops) is unclear. In fact, counsel for Preh states
that all of Preh's keytops, whether imported unprinted or
printed, are completely interchangeable--"the same size and style
of keytop is used on a rows and columns keyboard and on a QWERTY-style keyboard."
We do not have sufficient information to render a "principal
use" determination for the "interchangeable" printed and
unprinted keytops. It is therefore necessary to resort to note
2(c) to section XVI, HTSUS. Note 2(c) (1996) provides that
"[a]ll other parts are to be classified . . . in heading 8485 or
8548." The 1994 version of note 2(c) is substantially similar.
Heading 8485, HTSUS, provides for machinery parts, not
containing electrical connectors, insulators, coils, contacts or
other electrical features, and not specified or included
elsewhere in this chapter, while heading 8548, HTSUS, provides
for electrical parts of machinery or apparatus, not specified or
included elsewhere in this chapter. The keytops, which do not
contain electrical connectors, etc., and are not "electrical"
parts, are classifiable under heading 8485, HTSUS, specifically
under subheading 8485.90.00, HTSUS (1994/1996). This decision,
of course, may change if we can later determine the principal use
for the various keytops.
HOLDING:
1994
Samples A1, A2, A3 and C3 are classifiable under subheading
8537.10.90, HTSUS, which provides for other bases, equipped with
two or more apparatus of heading 8535 or 8536, HTSUS, for
electric control or the distribution of electricity, for a
voltage not exceeding 1,000 V. The corresponding rate of duty
for articles of this subheading is 5.3% ad valorem. - 10 -
Samples B and C1 are classifiable under subheading
8471.92.20, HTSUS, which provides for keyboards for ADP machines.
The corresponding rate of duty for articles of this subheading is
free.
Customized, printed keytops (such as the Coolant, Tool
in/out, Turret CCW and Turret CW of Sample A3) are classifiable
under subheading 8538.90.80, HTSUS, which provides for other
parts suitable for use solely or principally with the apparatus
of heading 8537, HTSUS. The corresponding rate of duty for
articles of this subheading is 5.3% ad valorem.
All other keytops, printed or unprinted, are classifiable
under subheading 8485.90.00, HTSUS, which provides for other
machinery parts, not containing electrical connectors,
insulators, coils, contacts or other electrical features, and not
specified or included elsewhere in this chapter. The
corresponding rate of duty for articles of this subheading is
5.7% ad valorem.
1996
Samples A1, A2, A3 and C3 are classifiable under subheading
8537.10.90, HTSUS. The corresponding rate of duty for articles
of this subheading is 4.3% ad valorem.
Samples B and C1 are classifiable under subheading
8471.60.20, HTSUS, which provides for keyboards for ADP machines.
The corresponding rate of duty for articles of this subheading is
free.
Customized, printed keytops (such as the Coolant, Tool
in/out, Turret CCW and Turret CW of Sample A3) are classifiable
under subheading 8538.90.80, HTSUS. The corresponding rate of
duty for articles of this subheading is 4.6% ad valorem.
All other keytops, printed or unprinted, are classifiable
under subheading 8485.90.00, HTSUS. The corresponding rate of
duty for articles of this subheading is 5% ad valorem.
This decision should be mailed by your office to the
internal advice requestor no later than 60 days from the date of
this letter. On that date, the Office of Regulations and Rulings
will take steps to make the decision available to Customs
personnel via the Customs Rulings Module in ACS and the public - 11 -
via the Diskette Subscription Service, Freedom of Information Act
and other public access channels.
Sincerely,
John Durant, Director
Tariff Classification Appeals Division