CLA-2 OT:RR:CTF:TCM H072723 RES
Port Director
Service Port
U.S. Customs and Border Protection
Suite 1
3150 Tchulahoma Road
Memphis, TN 38118
RE: Tariff classification of Corning Inc. PPMgLN Waveguide; Application for Further Review of Protest Numbers 2006-09-100125, 2006-09-100126, 2006-09-100127, 2006-09-100128, 2006-09-100129, 2006-09-100131, 2006-09-100132, 2006-09-100133, and 2006-09-100169.
Dear Port Director:
This letter is in reply to your memorandum dated April 3, 2009, regarding the Application for Further Review (“AFR”) of the Protests listed above filed on behalf of Corning Inc. (“Corning”). The protests are against the U.S. Customs and Border Protection’s (“CBP”) classification of PPMgLN Waveguides (“waveguides”) under the 2007 Harmonized Tariff Schedule of the United States (“HTSUS”).
FACTS:
The articles at issue in the instant AFR are referred to as PPMgLN Waveguides, which stands for “Periodically Poled Magnesium-Oxide (“MgO”) doped Lithium Niobate.” An optical waveguide is a spatially inhomogenous structure used in the field of lasers for guiding light. The imported waveguides come in three different sizes. The waveguides are non-linear crystal structures of Lithium Niobate, which have a small amount of MgO inserted into the structures as a dopant to alter the electrical and optical properties of the Lithium Niobate structure. The articles are used in the field of laser optics involving the nonlinear optic process of second-harmonic generation (“SHG”), which is the doubling of a laser beam’s frequency wave. For example, Corning uses the waveguides in a laser diode that converts infrared (“IR”) light into green light, which is visible to the human eye. The laser diode takes an input of a 1060 nanometer (“nm”) IR laser beam wave that is propagated through a waveguide, which doubles the wavelength frequency, and outputs a 530 nm a green light laser beam wave.
The instant AFR involve nine entries with entry dates between November 1, 2007, through April 30, 2008, inclusive. Corning filed a separate protest for each entry. The merchandise was entered in heading 9001, HTSUS, as “[o]ptical fibers and optical fiber bundles; optical fiber cables other than those of heading 8544; sheets and plates of polarizing material; lenses (including contact lenses) prisms, mirrors and other optical elements, of any material, unmounted, other than such elements of glass not optically worked.” The waveguides were liquidated between the dates of September 12, 2008, and March 13, 2009, as entered. Corning filed the protests on March 3, 2009, and March 19, 2009.
Corning asserts that the proper classification for the waveguides is under heading 8541, HTSUS, as “[d]iodes, transistors and similar semiconductor devices; photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels; light-emitting diodes; mounted piezoelectric crystals; parts thereof.”
ISSUE:
Whether the subject waveguides are classified under heading 8541, HTSUS, as parts of a light-emitting diode module or under heading 9001, HTSUS, as an unmounted optical element of any material?
LAW AND ANALYSIS:
Initially, CBP notes that the protests for the entries that were liquidated between September 12, 2008 and January 16, 2009, inclusive, were timely filed on March 2, 2009, which is within 180 days after these liquidation dates and that the protest for the entry liquidated on March 13, 2009, was timely filed on March 19, 2009. See 19 U.S.C. § 1514(c)(3). Additionally, CBP’s classification of the merchandise is a protestable matter under 19 U.S.C. § 1514(a)(2).
However, the AFR for the entries that were liquidated on September 12, 19, and 26, 2008, do not meet the criteria for further review because no justification for further review under the criteria in 19 C.F.R. § 174.24 and 19 C.F.R. § 174.25 was set forth by the protestant in the AFR for these particular entries.
In the “Application for Further Review” portion of the CBP Form 19 for Protest Numbers 2006-09-100125, 2006-09-100126, and 2006-09-100127, the Protestant did not answer the questions in Block 14 and the Protestant did not state a basis for further review in Block 16 as required by the criteria set forth in the CBP Regulations section 174.24 (19 CFR § 174.24). The only information written in Block 16 for these protests was the statement, “see letterhead.” However, the attachment referred to as the “letterhead” to the protest did not set forth any information that meets the criteria of 19 CFR §174.24.
Furthermore, the Protestant’s April 16, 2009, “Amended Protests and Application of Further Review Protests” memorandum was not filed within 180 days of the liquidation dates for said protests and is thus considered untimely filed in regard to the AFR. April 16, 2009, is 216 days after the September 12, 2008, liquidation date for Protest No. 2006-09-100125, 209 days after the September 19, 2008, liquidation date for Protest No. 2006-09-100127, and 202 days after the September 26, 2008, liquidation date for Protest No. 2006-09-100126. By failing to properly fill out Blocks 14 and 16 of CBP Form 19 or timely submit a memorandum stating the basis for further review, the Protestant’s AFR does not meet the requirements set forth in the applicable regulations, section 174.24. Therefore, Protest Numbers 2006-09-100125, 2006-09-100126, and 2006-09-100127, are being returned to you for your disposition.
AFR for Protests Nos. 2006-09-100128, 2006-09-100129, 2006-09-100131, 2006-09-100132, 2006-09-100133, and 2006-09-100169, meet the criteria for further review because the April 16, 2009, memorandum was timely filed within 180 days of the liquidation of the entries related to these protests. In addition, further review of these protests is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24 (b) because the decision against which the protest was filed is alleged to involve questions of law or fact which have not been ruled upon by the Commissioner of Customs or his designee or by the Court of International Trade.
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRI). GRI 1 provides that the classification of goods shall be “determined according to the terms of the headings 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 GRI 2 through 6 may be applied in order.
In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System, which constitute the official interpretation of the HTSUS at the international level, may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989).
The following HTSUS provisions are under consideration:
8541 Diodes, transistors and similar semiconductor devices; photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels; light-emitting diodes; mounted piezoelectric crystals; parts thereof:
9001 Optical fibers and optical fiber bundles; optical fiber cables other than those of heading 8544; sheets and plates of polarizing material; lenses (including contact lenses), prisms, mirrors and other optical elements, or any material, unmounted, other than such elements of glass not optically worked:
Corning asserts that the waveguides are classifiable under heading 8541, HTSUS, as parts of laser diode modules. However, Note 1(m) to Section XVI, HTSUS, states that “This section does not cover: Articles of Chapter 90.” Accordingly, if the waveguides are classifiable as articles of Chapter 90, regardless of whether they could be considered parts of laser diode modules of heading 8541, Legal Note 1(m) to Section XVI dictates that the waveguides would be excluded from being classified in Chapter 85. In analyzing whether the waveguides are classified in Chapter 90, EN 90.01 provides in pertinent part:
This heading covers:
* * * * *
(D) Optical elements of any material other than glass, whether or not optically worked, not permanently mounted (e.g., elements of quartz (other than fused quartz), fluorspar, plastics or metal; optical elements in the form of cultured crystals of magnesium oxide or of the halides of the alkali or the alkaline-earth metals).
Optical elements are manufactured in such a way that they produce a required optical effect. An optical element does more than merely allow light (visible, ultraviolet or infrared) to pass through it, rather the passage of light must be altered in some way, for example, by being reflected, attenuated, filtered, diffracted, collimated, etc.
* * * * *
Thus, the threshold issue is whether the waveguides are optical elements that, in light of EN 90.01, (1) are made of a non-glass material; (2) are imported unmounted; and (3) alter the light that passes through the waveguide. Optical elements are defined as elements which alter light in a way that permits or enhances human vision. Celestaire, Inc., v. United States, 120 F.3d 1232, 1233 (Fed. Cir. 1997).
The waveguides are PPMgLN non-linear crystals, which is a non-glass material. They are not imported mounted onto any type of clip, circuit board, bracket, or other base that would be assembled with a laser diode module or other apparatus. Lastly, the waveguides alter light that passes through it by changing the wavelength of IR laser light to a wavelength that is visible to the human eye. Thus, the waveguides meet the criteria for optical elements under heading 9001.
Corning did not cite any evidence or make the argument that the waveguides themselves are not optical elements of heading 9001. Instead, Corning cites Headquarters Ruling (“HQ) 960815, dated July 1, 1998, HQ 965524, dated August 29, 2002, and HQ 965967, dated January 17, 2003, and cites NEC Electronics, Inc., v. United States, 21 C.I.T. 327 (1997) in arguing that the waveguides are parts of laser diode modules. The cited rulings and case are not relevant or pertinent to the main issue in this AFR—which is whether the waveguides are actually optical elements. The issue in the rulings and the NEC case was whether laser diode modules (“LDMs”) were classifiable in either heading 8541 or 9031, HTSUS. The LDMs were considered composite goods composed of different components, which if imported separately, would have been classified under separate headings. The waveguides here are not composite machines composed of different components. Furthermore, the analysis in these rulings involved a GRI 3(b) essential character determination while the analysis here does not.
Accordingly, the waveguides are the type of optical elements as described in EN (D) to 90.01. Even accepting arguendo that the waveguides are to be used solely in some type of LDM, the waveguides are excluded by Note 1(m) to Section XVI from heading 8541, HTSUS, and are classified in heading 9001, HTSUS.
Therefore, the PPMgLN Waveguides are classified under the specific subheading of 9001.90.90, HTSUS, as ““[o]ptical fibers and optical fiber bundles; optical fiber cables other than those of heading 8544; sheets and plates of polarizing material; lenses (including contact lenses) prisms, mirrors and other optical elements, of any material, unmounted, other than such elements of glass not optically worked: [o]ther: [o]ther.”
HOLDING:
Pursuant to GRI 1 and by Note 1(m) to Section XVI the PPMgLN Waveguides are classified under heading 9001, HTSUS, specifically subheading 9001.90.90, HTSUS, as ““[o]ptical fibers and optical fiber bundles; optical fiber cables other than those of heading 8544; sheets and plates of polarizing material; lenses (including contact lenses) prisms, mirrors and other optical elements, of any material, unmounted, other than such elements of glass not optically worked: [o]ther: [o]ther.” The general, column one, rate of duty is 2.9% ad valorem.
The Protest should be DENIED. 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.
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