HQ 0087876 - Revocation of NY 853953 (dated June 16, 1990); Alarm Systems; Electric Sound or Visual Signaling Apparatus; Indicator Panels Incorporating Liquid Crystal Devices (LCD's) or Light Emitting Diodes (LED's) - United States International Trade Commision Rulings

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HQ 087876

December 27, 1991

CLA-2 CO:R:C:M 087876 MBR

CATEGORY: CLASSIFICATION

TARIFF NO.: 8531.20.00

Kenneth B. Reisenfeld
Reisenfeld & Associates
919 Eighteenth Street, N.W.
Suite 800
Washington, D.C. 20006

RE: Revocation of NY 853953 (dated June 16, 1990); Alarm Systems; Electric Sound or Visual Signaling Apparatus; Indicator Panels Incorporating Liquid Crystal Devices (LCD's) or Light Emitting Diodes (LED's)

Dear Mr. Reisenfeld:

This is in response to your request for reconsideration of NY 853953, dated June 16, 1990, on behalf of Digital Security Controls and Harman Security Products, regarding the classification of indicator panel/keypad units for alarm systems, under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

Digital Security Controls ("DSC") manufactures alarm systems. Harman Security Products ("Harman") is a wholly owned subsidiary of DSC, responsible for marketing DSC products in the U.S. The indicator panel/keyboard unit together with a separate control unit comprise the DSC basic alarm system. When installed on site, the remote indicator panel/keypad unit is mounted in an accessible location near an entry/exit point, inside the protected premises. The separate control unit is mounted out of sight, generally in a closet or basement. When installed, the two units are connected by a four conductor cable. The instant ruling deals only with the indicator panel/keypad unit.

DSC manufactures nine versions of its indicator panel/keypad units. Six versions utilize LED displays and conform to the different models of the basic system (PC 1000RK, PC 1500RK, PC 2500RK, PC 2530RK, PC 2550RK, and PC 3000RK). Three versions incorporate an LCD message display which signals emergencies and explains the system's conditions in English language text.

DSC's indicator panel/keypad units consist of an LED indicator panel (the LCD models also include an LCD panel which displays emergencies, system information, and prompts on two 16 character LCD lines), a numerical keypad, a built-in sounder, three enlarged emergency buttons, and a circuit board. The circuit board for the LED models contains resistors, transistors, diodes, and integrated circuits permitting the indicator panel/keypad to communicate with the CPU contained in the separate control unit. The LCD indicator panel/keypad units also contain EEPROM memory to store the translation information for the English language display. The primary difference between the various models is the number of zones to be monitored, ranging from four zones (PC 1000RK) to sixteen zones (PC 3000RK).

ISSUE:

What is the proper classification of the DSC indicator panel/keypad for alarm systems, under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA)?

LAW AND ANALYSIS:

Internal Advice 4/91, HQ 088595, dated September 12, 1991, held that the Harman "Basic Alarm Systems," comprising the control unit and the remote keypad, imported together, were classifiable under 8531.10.00, HTSUS.

The instant ruling, therefore, is restricted to the DSC/Harman indicator panel/keypad units imported separately. On June 6, 1990, DSC submitted a ruling request resulting in the issuance of NY 853953, dated June 16, 1990, which addressed the classification of "programmable control panels" imported from Canada.

The importer's counsel argues that: "DSC's [ruling] request of June 6, 1990 was intended to obtain a classification ruling for the indicator panel/keypad units when they are shipped separately from the control unit. The New York Ruling, however, does not describe nor provide a proper classification for the indicator panel/keypad units. Therefore, we request that the New York Ruling be revoked and that Headquarters issue a ruling for both DSC and Harman which properly classifies the indicator panel/keypad units as indicator panels under HTS Item 8531.20 or, alternatively, as parts of burglar alarms under HTS Item 8531.90."

Subheading 8531.20.00, HTSUS, provides for: "[e]lectrical sound or visual signaling apparatus (for example, bells, sirens, indicator panels, burglar or fire alarms), other than those of heading 8512 or 8530; parts thereof: [i]ndicator panels incorporating liquid crystal devices (LCD's) or light emitting diodes (LED's)."

The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) regarding heading 8531, HTSUS, page 1381, state:

With the exception of signalling apparatus used on cycles or motor vehicles (heading 85.12) and that for traffic control on roads, railways, etc. (heading 85.30), this heading covers all electrical apparatus used for signalling purposes, whether using sound for the transmission of the signal (bells, buzzers, hooters, etc.) or using visual indication (lamps, flaps, illuminated numbers, etc.), and whether operated by hand (e.g., door bells) or automatically (e.g., burglar alarms).

The heading includes, inter alia:

(D) Indicator panels and the like. These are used (e.g., in offices, hotels and factories) for calling personnel, indicating where a certain person or service is required, indicating whether a room is free or not. They include:

(1) Room indicators. These are large panels with numbers corresponding to a number of rooms. When a button is pressed in the room concerned the corresponding number is either lit up or exposed by the falling away of a shutter or flap.

Certain of these indicator panels, etc., also incorporate bells or other sound signalling devices.

The importer's counsel argues that the subject products are electrical apparatus which both signal emergencies and convey information through visual LED and LCD indicators. The "memory" and zone LED lights and the LCD display fulfill the principal function of the alarm system by signalling whether a burglary, fire, or other emergency has or is occurring. The indicator panel further indicates the zone(s) [rooms] that have been entered. Once alerted, the user can take proper precautions before entering the premises. The units' system LED lights and LCD readout also display critical information which is both readily understood by the user and necessary for the user to operate the burglar alarm system.

We agree that these indicator panel/keypad units are properly provided for in subheading 8531.20.00, HTSUS, since they "may simply convey information or notify of a specific event which will be readily understood by the user." A & A International, Inc. v. United States, 5 CIT 183, 189 (1983).

The indicator panel/keypad unit is a composite machine consisting of two machines fitted together (the indicator panel and the keypad) to form a whole. Section XVI, Legal Note 3., states:

Unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines adapted for the purpose of performing two or more complementary or alternative functions are to be classified as if consisting only of that component or as being that machine which performs the principal function.

The purpose of the alarm system is to notify the user of the present status/situation at the premises. The indicator panel itself alerts the user to burglaries, fires, and emergency conditions that are occuring at that time. Therefore, it is Customs position that the indicator panel in fact carries out the principal function(s) of the indicator panel/keypad unit, and is thus classifiable under the provision for indicator panels.

HOLDING:

The Digital Security Controls "Indicator Panel/Keypad Units," marketed by Harman Security Products, are classifiable in subheading 8531.20.00, HTSUS, which provides for: "[e]lectrical sound or visual signaling apparatus (for example, bells, sirens, indicator panels, burglar or fire alarms), other than those of heading 8512 or 8530; parts thereof: [i]ndicator panels incorporating liquid crystal devices (LCD's) or light emitting diodes (LED's)."

EFFECT ON OTHER RULINGS:

NY 853953, dated June 16, 1990, is revoked under authority of Section 177.9(d), Customs Regulations.

Sincerely,

John Durant, Director

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