HQ 0087425 - Revocation of Headquarters Ruling Letter 083673, floppy diskette clamshell - United States International Trade Commision Rulings

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HQ 087425

August 6, 1990

CLA-2 CO:R:C:G 087425 JMH

CATEGORY: CLASSIFICATION

TARIFF NO.: 3926.90.90

Mr. Jack Ryan
Customs Administrator
Customs/Import
Transportation Department/3M
3M Center
P.O. Box 33250
St. Paul, Minnesota 55133-3250

RE: Revocation of Headquarters Ruling Letter 083673, floppy diskette clamshell

Dear Mr. Ryan:

This is to inform you that Headquarters Ruling Letter 083673 ("HQ 083673"), dated May 19, 1989, has been revoked in accordance with Customs Regulation 177.9(d), 19 C.F.R. 177.9(d) (1989). The following is the proper classification of the subject floppy diskette clamshell subassembly.

FACTS:

The articles in question are floppy diskette clamshells which act as the protective covering or holder for magnetic discs. The plastic clamshells and the magnetic discs from floppy diskettes. Floppy diskettes are used with automatic data processing machines ("ADPs").

The floppy diskette clamshells consist of two flat pieces of molded plastic measuring 3.5 inches square and 1/16 inch thick, two circular fibrous discs, and a steel shutter. The two flat pieces of molded plastic are secured together on one side. The other three sides are left unsecured to allow further assembly after importation. The two circular fibrous discs line the inside of each of the two clamshell halves. The steel shutter with a loaded spring return is fitted onto one side of the clamshell assembly.

After importation, the clamshell is opened and a magnetic media is inserted. The finished diskette is inserted into a
computer's disc drive. Once in the drive, the diskette is locked into place, the shutter opens and the magnetic media, the disc, is exposed to the drive heads.

ISSUE:

What is the proper classification under the Harmonized Tariff Schedule of the United States Annotated ("HTSUSA") for the plastic floppy diskette clamshell, with the circular fibrous discs, and the steel shutter with a loaded spring return, but without the magnetic media?

LAW AND ANALYSIS:

The classification of merchandise under the HTSUSA is governed by the General Rules of Interpretation (GRI's). GRI 1, HTSUSA, states in part that "for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes...and according to the following provisions..."

HQ 083673 classified the clamshells within subheading 8473.30.40, HTSUSA, as "Parts and accessories...suitable for use solely or principally with machines of headings 8469 to 8472...Parts and accessories of the machines of heading 8471...Not incorporating a cathode ray tube..." Heading 8471, HTSUSA describes automatic data processing machines ("ADPs"). The classification within heading 8473, HTSUSA, was reached in HQ 083673, after the determination that the plastic clamshells were not "Bobbins, spools, cops, cones, reels or similar supports, of any material..." These items are excluded from classification within Section XVI, HTSUSA, by Section XVI, Note 1(c), HTSUSA. HQ 083673 stated that "the articles referred to in Note 1(c) are articles that form a core on which something is typically wound, and the magnetic media inserted into a diskette clamshell is not wound..." See HQ 083673, p. 2. The clamshells were then classified within heading 8473 because of Section XVI, Note 2(b), HTSUSA. Section XVI, Note 2(b) requires that a part used solely or principally with a machine of chapter 84 or 85 is to be classified with that machine.

This office continues to believe that the plastic clamshells are not "bobbins, spools, cops, cones, reels, or similar supports" for the reasons stated in HQ 083673. However, HQ 083673 failed to address Chapter 85, Note 6, HTSUSA. Chapter 85, Note 6 requires that unrecorded media remain classified within heading 8523, HTSUSA, "whether or not they are entered with the apparatus for which they are intended." Heading 8523 describes "Prepared unrecorded media for sound recording or similar recording of other phenomena, other than products of chapter 37..."

The recording media within micro floppy diskette clamshells is unrecorded media within the meaning of Chapter 85, Note 6 and is classified within heading 8523 when entered without the plastic clamshell. Complete or finished unrecorded micro floppy diskettes, consisting of both the plastic housing and the recording media, are also classified within heading 8523. See Headquarters Ruling Letter 086851 ("HQ 086851"), dated April 9, 1990.

Since the subject merchandise is only the plastic clamshell, it is an incomplete floppy diskette. GRI 2(a), HTSUSA, one of "the following provisions" mentioned in GRI 1, requires that references to an article in a heading include references to that article in an incomplete or unfinished state, providing the incomplete or unfinished article has the essential character of the complete or finished article.

It is the opinion of this office that the essential character of a floppy diskette is imparted by the magnetic media within the diskette. The magnetic media is the most expensive part of the diskette. The plastic clamshell simply protects the media. Since the magnetic media is absent at the time of entry, the plastic clamshells in question do not have the essential character of a complete or finished floppy diskette. Therefore, the plastic clamshells cannot be classified under heading 8523.

As stated previously, Section XVI, Note 2(b) requires that parts used solely or principally with a particular kind of machine are to be classified with that machine. Section XVI, Note 5, HTSUSA, defines "machine" as "any machine, machinery, plant, equipment, apparatus, or appliance cited in the headings of chapter 84 or 85." In order for the clamshell to be classified within heading 8473, the article it is a part of must be classified within heading 8473. A floppy diskette is not a part or an accessory of ADPs to be classified within heading 8473 because of Chapter 85, Note 6.

The plastic clamshell is a part of a micro floppy diskette. Magnetic media or a micro floppy diskette is "equipment" or "apparatus" within Section XVI, Note 5. The provisions of heading 8523 do not include a subheading for parts. Therefore, the plastic diskette clamshell, although used solely or principally with floppy diskettes or magnetic media cannot be classified under heading 8523.

Since the plastic diskette clamshells cannot be classified as a part of micro floppy diskettes, the clamshells must be classified according to their constituent material. The clamshells consists of three materials, plastic, steel and a fiber, each of which are described in different headings. When goods are classifiable under two or more headings, GRI 3,

HTSUSA, must be utilized. GRI 3(a) states that the most specific description is preferred among the possible classifications, but when the headings refer to only part of a composite good, the headings are equally specific. The clamshells, consisting of plastic, steel and a fiber are composite goods. Thus, no heading is more specific than the others.

When articles cannot be classified according to GRI 3(a), GRI 3(b), HTSUSA, must be used. GRI 3(b) states that a composite good is to be classified according to the component which gives the good its essential character. The plastic of the clamshell gives the floppy diskette clamshell its essential character. The plastic is the most important component. It provides the configuration of the floppy diskette with which users are familiar. Therefore, the clamshell should be classified as an article of plastic.

Plastics and articles thereof are covered by Chapter 39, HTSUSA. Chapter 39, Note 1(o), HTSUSA, excludes "Articles of section XVI (machines and mechanical or electrical appliances)" from classification within chapter 39. The exclusionary language suggests that complete machines were meant to be excluded from Chapter 39. This language would also cover parts of machines that have provisions within Section XVI. However, the plastic clamshells are not provided for within Section XVI as a machine or a part. Therefore, the proper classification for the floppy diskette clamshell is under subheading 3926.90.90, HTSUSA, as "Other articles of plastics and articles of other materials of heading 3901 to 3914...Other...Other..."

HOLDING:

The floppy diskette clamshell is a composite good consisting of plastic, steel and a fiber. As a composite good, it must be classified according to the component which provides the clamshell's essential character. Plastic provides the essential character of the clamshell. Therefore, in accordance with GRI 3(b), the correct heading for the floppy diskette clamshell is heading 3926, which describes "Other articles of plastics and articles of other materials of heading 3901 to 3914..." The proper classification for the floppy diskette clamshell is under subheading 3926.90.90, HTSUSA, as "Other articles of plastics and articles of other materials of heading 3901 to 3914...Other... Other..." The rate of duty applicable to this classification is 5.3 percent ad valorem.

HQ 083673 is revoked in accordance with Customs Regulation 177.9(d), 19 C.F.R. 177.9(d) (1989).

This office recognizes that pending transactions may be adversely affected by this revocation. Should this situation arise, you may notify this office and apply for temporary relief from the binding effects of this ruling. Such a request would be pursuant to Customs Regulation 177.9(d)(3), 19 C.F.R.

Sincerely,

John Durant, Director
Commercial Rulings Division

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