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HQ 086841


July 2, 1990

CLA-2 CO:R:C:G 086841 CMS

CATEGORY: CLASSIFICATION

TARIFF NO.: 8537.10.00; 8471.93.60; 8523.90.00; 8524.90.40

Mr. J. T. Graham
Operations Director
ABS Electronics
395 Holywood Road
Belfast BT4 2LS
N. Ireland

RE: ABS Electronics Copymanager System

Dear Mr. Graham:

Your request dated March 1, 1990, for a classification ruling on the ABS Electronics Copymanager System has been forwarded by the Regional Director of Customs, New York to Customs Headquarters for a reply. Our ruling follows.

FACTS:

The merchandise consists of the ABS Electronics Copymanager System. The system is used to control certain photocopier functions and to monitor photocopier use data for subsequent analysis and report preparation. The system consists of four components designated as the Copymanager unit, the Datacollector unit, the Software package and the Copymanager cards.

The Copymanager unit connects directly to many types of photocopiers. It controls user access by turning the copier on when the correct access information is provided. The unit controls the number of copies which can be made by shutting off the copier when users attempt to exceed their allotment. The unit also shuts down the copier when instructed by the user, after a certain time if the user does not disable it, or after a certain number of failed entry attempts. The users gain access with a magnetic card or a personal identification number (PIN). The Copymanager unit is a programmable microprocessor controlled unit with a keyboard, LCD display, random access memory and read only memory. The LCD panel displays information such as user instructions and the number of copies remaining in a user's allotment. Data such as the identity of the user and the number of copies made is stored for subsequent transfer to the

Datacollector.

The Datacollector extracts copier use data from the Copymanager unit, stores the data and uploads it to a personal computer. Data can be collected and stored from as many as 46 copiers. When the Datacollector's memory is full the data is uploaded to a personal computer and the process is repeated for the remaining photocopiers. The Datacollector has a 16K RAM.

The Software package is a dedicated software program recorded on magnetic floppy discs. The program is used to analyze the copier data and to produce detailed and summary copier management reports. The floppy discs are inserted into the personal computers which are uploaded by the Datacollectors.

The Copymanager cards are plastic "credit card" sized cards with magnetic strips for the recording of Copymanager access codes.

ISSUES:

1) Are the components of the Copymanager System classified together as a composite machine, functional unit or a set?

2) What are the classifications for the components if they are classifiable separately?

LAW AND ANALYSIS:

The ABS Electronics Copymanager System is entered as a "system" consisting of one of each of the four components.

The system is not a Section XVI Note 3 composite machine because the components are not "fitted together to form a whole" as required by Section XVI Note 3. The Datacollector is portable and is only connected to a Copymanager unit when extracting data. The Copymanager cards are simply passed through the Copymanager unit's card reader. The floppy discs are inserted into a personal computer and not into one of the system components.

The system components do not form a Section XVI Note 4 functional unit because they do not "contribute together to a clearly defined function covered by one of the headings in Chapter 84 or 85" as required by Section XVI Note 4. The Copymanager system principally controls photocopier functions, and collects, stores and uploads data relating to copier use. The system components perform several important functions which together are not described by a Chapter 84 or 85 heading.

GRI 3(b) provides for goods put up in sets for retail sale. The Explanatory Notes to GRI 3(b), p. 4 provide in pertinent part
that goods put up in a manner suitable for sale to users without repacking are classified as a set when they together meet a particular need, and consist of at least two articles classifiable in different headings. The system components together meet the particular need of photocopier management, including access control and analysis of copier use data.

At least two of the system components are classifiable in separate headings. The Copymanager unit performs control functions and stores data used for photocopier use analysis. The manufacturer's descriptive literature provides: "Put simply, the Copymanager helps you control your photocopying function-the way it operates and the costs it incurs." The Copymanager unit can perform the operational control functions without the assistance of the other components, while the data analysis function requires the use of other components. The control function is the principal function of the Copymanager unit. Heading 8537 describes certain control apparatus. The Explanatory Notes to Heading 8537, p. 1391 provides that Heading 8537 includes programmable apparatus which control various types of machines. For example, the Explanatory Notes at p. 1391 provide for:

"Programmable controllers" which are digital apparatus using a programmable memory for the storage of instructions for implementing specific functions such as logic, sequencing, timing, counting and arithmetic, to control...various types of machines.

The Copymanager unit is described in Heading 8537 and is classifiable in subheading 8537.10.00. The device is not classified as a part or accessory of photocopiers in Heading 9009 because it is not an integral component of a copier, it is a separate and distinct machine, and Section XVIII Note 2(a) provides that parts and accessories included in the headings of Chapter 84 are classified there and not in Chapter 90.

The Datacollector extracts and stores data which is then retrieved from the Datacollector's memory by a data processing machine. The Datacollectors perform data processing storage and input, and storage is the principal function. The Datacollectors depend on their memory to collect and upload data; when the memory is full the articles can no longer function except to upload the data and begin collecting and storing new data. The Datacollectors meet the criteria for units of data processing machines provided in the Explanatory Notes to Heading 8471, p. 1298; the articles are (a) connectable to the CPU of an automatic data processing machine directly or through one or more other units, and are (b) specifically designed as a data collection and storage part of a data processing system which, along with other functions, processes data relating to the use of photocopiers.

The Datacollectors also deliver data in a form which can be used by the processing system. The Datacollectors are described by Heading 8471 as automatic data processing machine storage units, and are classifiable in subheading 8471.93.60.

The Datacollectors are not classified as parts or accessories of photocopiers in Heading 9009 because they are not integral components of copiers, are separate and distinct machines, and Section XVIII Note 2(a) provides that parts and accessories included in the headings of Chapter 84 are classified there and not in Chapter 90.

The Software package consisting of recorded floppy discs is classified in 8524.90.40, HTSUSA. The Copymanager cards when unrecorded are classified in 8523.90.00, and when recorded fall in 8524.90.40.

The Copymanager System, when entered in a manner suitable for retail sale directly to users without repacking, is classified as a GRI 3(b) set. The component which gives the set its essential character is the Copymanager unit. The Copymanager unit can perform the operational control function without the assistance of the other components, and also performs part of the data analysis function by storing the data for transfer to the Datacollector. When entered as a set, the Datacollector is classified with the Copymanager unit in 8537.10.00, HTSUSA. When not entered as a set the Datacollector is classified in 8471.93.60, HTSUSA. Pursuant to Chapter 85 Note 6, the software package and magnetic access cards are always classified in their respective headings.

HOLDING:

When entered in a manner suitable for retail sale directly to users without repacking, the Copymanager unit and Datacollector are classified together in 8537.10.00, HTSUSA. When not entered in a manner suitable for sale directly to users without repacking, the Copymanager unit is classified in 8537.10.00, HTSUSA, and the Datacollector is classified in 8471.93.60, HTSUSA. The recorded Software package is always classified in 8524.90.40, HTSUSA. The Copymanager cards are always classified in 8523.90.00, HTSUSA when unrecorded, and in 8524.90.40, HTSUSA when recorded.

Sincerely,

John Durant, Director

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