CLA-2-84:RR:NC:1:103 C88238
Mr. Patrick D. Gill
Ms. Eleanore Kelly-Kobayashi
Rode & Qualey
295 Madison Avenue
New York, NY 10017
RE: The tariff classification of the HaystackTM Automated Compound
Management System from the United Kingdom and Switzerland
Dear Mr. Gill and Ms. Kelly-Kobayashi:
In your letter dated May 20, 1998 on behalf of Bristol-Myers Squibb you
requested a tariff classification ruling. You submitted additional information
regarding this prospective transaction in letters dated June 4, 1998 and June
30, 1998.
The HaystackTM is an automated modular system for the storage, retrieval,
and preparation of very large numbers of chemical compounds and dissolved
samples used in pharmaceutical research. A researcher places an order for a
controlled quantity of a specific compound by means of a computer interconnected
to the HaystackTM system database. The HaystackTM system automatically obtains
the desired compound from the storage module, prepares a specific amount of the
compound, and makes the compound available to the researcher. The system is
sold in various configurations, depending on the needs of the customer, and can
include modules which store, weigh out, make solutions and retrieve minute
samples for screening.
The particular system your client intends to import will basically consist
of the following modules:
Dry compound store;
Microtube store;
Microtitre plate store;
Six manual dispensing (weighing) stations;
Solubilization unit; and
Twenty-eight computers.
Each bottle containing a chemical compound is assigned a bar code
identification which is recorded in the HaystackTM database. The bottles are
then loaded onto trays and transferred to the dry compound store. Utilizing
robots and conveyors, the trays are unloaded onto automated carrousels and the
samples are transferred to storage racks. The sample's bar code ID is utilized
to keep track of its location in the storage rack.
When a sample is requested, the robot retrieves the appropriate bottle and
conveyors bring it to the weighing stations (which you refer to as manual powder
dispensers) so that the precise quantity needed by the researcher can be
obtained (in your letter of June 4, 1998 you stated that the HaywainTM, an
automated powder dispensing unit, was previously imported by your client and is
currently operating independently; this unit subsequently will be integrated
with the balance of the modules). The weighing stations each consist of a
computer display and a digital scale accurate to within 0.1 mg. The display
indicates to the operator the amount of compound needed, and the operator
manually dispenses the powder onto the scale until the desired amount is
reached. The weight is automatically recorded in the HaystackTM system. The
operator then fills a container with the compound and inputs this data to update
the inventory records.
The powder is then transported to the solubilization module. Based on
information previously stored in the HaystackTM system, the correct amount of
solvent is automatically dispensed and mixed with the compound. A display unit
tells the operator what types of microtubes and microtitre plates to load into
the module. The solubilized powders are automatically dispensed onto the plates
or into the tubes, as appropriate.
The microtubes, which are held in racks, are carried to the microtube store
module where, as in the dry compound store, robots and conveyors are used to
move the racks into storage and the rack's bar code ID is recorded. The
microtitre plates are transferred to the microtitre plate store module. By
scanning the bar code on the plates, the operator is instructed as to where to
place the samples in the unit's rolling storage drawers for subsequent retrieval
by the researcher.
The activities of the HaystackTM system are controlled by a complex system
of 28 computers which link all of the modules together. The computers consist
of:
5 PCs which control the dry compound store (4 bottle unit control PCs and 1
bottle store control PC);
5 PCs which control the microtube store (4 tube unit control PCs and 1 tube
store control PC);
4 PCs (mounted in a rack with one monitor/keyboard/mouse set with a
switchbox) which control the plate store;
6 PCs which control the manual dispensing (weighing) units;
2 database servers, which track the location and status of all the vessels
and operations in the HaystackTM system;
1 system PC and a 1 doorman PC, which act as the interface between the
HaystackTM system and the Bristol-Myers Squibb computer network;
1 maintenance PC, used for daily back-up operations;
1 supervisor workstation; and
2 handheld portable maintenance PCs incorporating a flat display and a
stylus input device.
The two database servers are in a tower format and each has its own monitor,
keyboard and mouse. The rack-mounted system and doorman PCs are in a desktop
format and they utilize a switchbox to share monitor, keyboard and mouse with
one of the plate store PCs. The dedicated software needed to operate the
HaystackTM system will be imported either on diskettes or on the hard disk
drives of the computers. The software is not available on CD, and has no sound
or image capabilities.
You contend the HaystackTM system is a functional unit and is classifiable
in heading 8428, Harmonized Tariff Schedule of the United States (HTS), which
provides for other lifting, handling, loading or unloading machinery. You point
out that subheadings within heading 8428 provide for automated transport,
handling and storage machinery, which are also the functions performed by the
HaystackTM. You also cite the Explanatory Notes to Section XVI, note 4, which
gives several examples of functional units you believe are pertinent.
Alternatively, if not forming a functional unit, you claim the modules are
individually classifiable as follows:
The dry compound store, microtitre plate store, and microtube store in
subheading 8428.39.80, HTS, which provide for other continuous-action elevators
and conveyors, for goods or materials, or in subheading 8428.90.80, HTS, which
provides for other lifting, handling, loading or unloading machinery;
The solubilization unit in subheading 8422.30.90, as other machinery for
filling, closing, sealing or labeling bottles, cans, boxes, bags or other
containers, or in subheading 8479.82.00, HTS, as other machines and mechanical
appliances: mixing...homogenizing, emulsifying or stirring machines;
The manual dispensing (weighing) machines in subheading 9016.00.60, HTS, as
other balances of a sensitivity of 5 cg or better, with or without weights;
The various computers, even if intended to work in conjunction with the
other modules, in subheading 8471.49.10, HTS, as other digital automatic
processing machines entered in the form of systems;
The software in heading 8524, HTS, as records, tapes and other recorded
media for sound or other similarly recorded phenomena....
In our opinion the HaystackTM system your client intends to import is not a
functional unit. Note 4 to section XVI states:
Where a machine (including a combination of machines) consists of
individual components (whether separate or interconnected by piping, by
transmission devices, by electric cables or by other devices) intended to
contribute together to a clearly defined function covered by one of the headings
in chapter 84 or chapter 85, then the whole falls to be classified in the
heading appropriate to that function.
The main function performed by the HaystackTM system is not handling and storage
but preparation of a controlled quantity of a specific compound tailored to the
requirements of the requestor. Sample preparation (including weighing and
solubilization) is not a function encompassed within the terms of heading 8428.
While you claim that any functions other than handling and storage are
auxiliary, these other functions are essential in order for the HaystackTM
system to operate as intended. As the HaystackTM does not perform a single,
clearly defined function covered by one of the headings of chapter 84 or chapter
85, it cannot be classified as a functional unit (the Customs Service has
previously ruled that functional units cannot be classified in heading 8479,
which provides for machines and mechanical appliances, having individual
functions, not specified or included elsewhere in chapter 84 - see Ruling
Letters HQ 958629 dated Feb. 21, 1996 and HQ 958641 dated Apr. 29, 1996).
The various modules are thus separately classifiable in their own
appropriate headings:
The dry compound store, consisting of robots, conveyors, and automated
storage units controlled by 5 PCs, does form a functional unit used to
transport, handle and store compounds. The applicable subheading for this
module, including the PCs, imported together in a single shipment, will be
8428.90.80, HTS, which provides for other lifting, handling, loading or
unloading machinery: other machinery: other. The rate of duty will be 0.4
percent ad valorem. This same classification also applies to the microtube
store and microtitre plate store and their computer controllers, imported in a
single shipment, as each likewise forms a functional unit for transport,
handling and storage.
In our opinion the main function of the solubilization module is the mixing
of the solvent with the compound in order to solubilize the compound. As mixing
is not a function encompassed by the terms of heading 8422, the solubilization
module cannot be classified in subheading 8422.30.90, as you suggested. The
applicable subheading for the solubilization module will be 8479.82.00, HTS,
which provides for machines and mechanical appliances having individual
functions, not specified or included elsewhere (in chapter 84): other machines
and mechanical appliances: mixing...homogenizing, emulsifying or stirring
machines. The rate of duty will be 0.7 percent ad valorem.
Per your June 4 letter, the "signals" of the scales of the manual
dispensing units "are digital". We take that to mean that the outputs of the
sensor elements of the scales are electrical currents which are in digital, not
analog, format. Therefore, they are not "electrical" apparatus so your proposed
alternative classification in 9016.00.60 does apply. They are classifiable in
HTS 9016.00.6000, dutiable at 4 percent ad valorem, as balances of a sensitivity
better that 5 cg, which are neither jeweler`s balances nor "electrical".
The two database servers are basically tower format units that include a
processor, monitor, keyboard and mouse. The doorman and system PCs, as well as
the maintenance PC and the supervisor workstation, are in a desktop format and
also incorporate a monitor, keyboard and mouse. As these meet the definition of
a "system" per subheading note 1 to chapter 84, the applicable classification
and rate of duty will be as follows:
Article HTS Class. Duty Rate
Processor 8471.49.1095 Free
Monitor 8471.49.2600 0.5 percent
Keyboard 8471.49.2100 Free
Mouse 8471.49.4895 Free
The two handheld maintenance PCs are basically portable PCs which have a
windows screen on a flat panel display with a stylus input device. The
applicable subheading for these articles will be 8471.30.0000, HTS, which
provides for portable digital automatic data processing machines. The rate of
duty will be 1.4 percent ad valorem.
The applicable subheading for the software diskettes will be 8524.91.00,
HTS, which provides for records, tapes and other recorded media for sound or
other similarly recorded phenomena...: other: for reproducing phenomena other
than sound or image. The duty rate will be 1.3¢ per square meter of recording
surface. The software which will be imported on a computer hard disk drive will
be classifiable in subheading 8524.99.90, HTS, which provides for records, tapes
and other recorded media for sound or other similarly recoded phenomena...
other: other: other. The duty rate will be 1.9¢ per square meter of recording
surface.
This ruling is being issued under the provisions of Part 177 of the Customs
Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be
provided with the entry documents filed at the time this merchandise is
imported. If you have any questions regarding the ruling, contact National
Import Specialist Alan Horowitz at 212-466-5494.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division