CLA-2-84:OT:RR:NC:N2:220
Paul Stanchev
Sparton of Canada, Limited
4-530 Rowntree Dairy Rd
Woodbridge, L4L 8H2
Canada
RE: The tariff classification of personal computers (PCs) from Canada
Dear Mr. Stanchev:
In your letter dated March 13, 2019 you requested a tariff classification ruling.
The first item under consideration is identified as the Little PC, Model LPC-830, which is described as a ruggedized small form factor PC consisting of the main board, an Intel processor, 4 GB of memory, a solid state storage drive, multiple display output connections, RJ-45 network connections, USB and COM ports, and a ruggedized case. The Little PC may be configured with an internal or external power supply with an option for an optical drive. You state that the Little PC is capable of running a variety of Microsoft or Linux Operating Systems (OSs).
The second item under consideration is identified as the Rackmount PC, Model SR-3500, which is described as an industrial rack mounted server consisting of the main board, an Intel or AMD processor, 64 Gb of memory, various storage drives configurations with bays for additional drives, multiple display output connections, an RJ-45 network connection, USB and COM ports, and a 19” enclosure. You state that the Rackmount PC is capable of running a variety of Microsoft Server OS or Linux OS is configurable to the user’s specifications for storage and memory options.
The third item under consideration is identified as the Panelmount PC, Model PM-3500BA, which is described as an industrial wall or panel mounted PC consisting of the main board, an AMD processor, 64 GB of memory, various storage drive configurations with bays for additional drives, multiple display output connections, an RJ-45 network connection, USB and COM ports, and an enclosure designed for Panel/Wall/Desk/Bench/Tower Mounting. You state that the Panelmount PC is capable of running a variety of Microsoft OSs.
The fourth item under consideration is identified as the Portable PC, Model StealthBOX-Warrior2-ATX-20, which is described as an industrial PC consisting of the main board, an Intel or AMD processor, 64 GB of memory, various storage drive configurations, multiple RJ-45 network connections, USB and COM ports, an attached keyboard, a 21” LCD display, and a ruggedized mobile enclosure. The Portable PC is designed to be mobile and used in harsh environments. We would note that the unit weighs approximately 29 kg.
The fifth item under consideration is identified as the Personal Computer which consists of the main board, an Intel processor, 4 GB of memory, a 1 TB SATA drive, an optical drive, an RJ-45 network connection, USB and COM ports, and a tower enclosure. You state the Personal Computer utilizes the Microsoft OS.
In your request you suggest the Little PC, the Rackmount PC, and the Personal Computer are properly classified as an automatic data processing (ADP) machines under 8471.50.0150, Harmonized Tariff Schedule of the United States (HTSUS). You also suggest that the Panelmount PC and the Portable PC are properly classified as ADP systems under 8471.49.0000, HTSUS.
We would note that for a good to be considered an ADP machine, it must satisfy all the requirements set forth in Chapter 84 Note 5 (A), HTSUS, which requires the machine is capable of:
Storing the processing program or programs and at least the data immediately necessary for the execution of the program;
Being freely programmed in accordance with the requirements of the user;
Performing arithmetical computations specified by the user; and
Executing, without human intervention, a processing program which requires them to modify their execution, by logical decision during the processing run.
Based on the information provided, each of the subject PCs are freely programmable ADP machines which do not impose any hardware or software limitations which would restrict the user from adding/removing an application or operating system of their choosing. Thus, we are of the opinion that the requirements of Note 5 (A) are satisfied and the Little PC, the Rackmount PC, the Panelmount PC, the Portable PC, and the Personal Computer are fully functioning ADP machines as described in the nomenclature.
With regard to your suggested classifications, we agree in part only. The Panelmount PC, consisting only of the central processing unit, does not satisfy the requirements of an ADP system in that there is no input, output, or combined input/output unit. Furthermore, the Portable PC, consisting of the processing unit, the LCD display, and the keyboard which are all contained within the same ruggedized enclosure, is more appropriately described in previous subheadings.
The applicable subheading for the Portable PC, Model StealthBOX-Warrior2-ATX-20, will be 8471.41.0150, HTSUS, which provides for “Automatic data processing machines and units thereof; …: Other automatic data processing machines: Comprising in the same housing at least a central processing unit and an input and output unit, whether or not combined: Other.” The general rate of duty will be Free
The applicable subheading for the Little PC, Model LPC-830, the Rackmount PC, Model SR-3500, the Panelmount PC, Model PM-3500BA, and the Personal Computer will be 8471.50.0150, HTSUS, which provides for “Automatic data processing machines and units thereof… Processing units other than those of subheading 8471.41 or 8471.49, whether or not containing in the same housing one or two of the following types of unit: storage units, input units, output units: Other.” The general rate of duty will be Free.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at https://hts.usitc.gov/current.
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 Karl Moosbrugger at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division