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HQ 951868


October 31, 1992

CLA-2 CO:R:C:M 951868 MBR

CATEGORY: CLASSIFICATION

TARIFF NO.: 9013.80.60

Mr. Peter J. Gartland
Donovan Leisure Newton & Irvine
30 Rockefeller Plaza
New York, N.Y. 10112

RE: Liquid Crystal Display; LCD; Glass Sandwich; Part For ADP Output Display; 9013; 8531; 8471; E.M Chemicals v. United States; HQ 951609; HQ 952360; HQ 951288

Dear Mr. Gartland:

This is in response to your letter of May 12, 1992, on behalf of Sharp Electronics Technology, Inc., requesting the classification of glass sandwiches for liquid crystal displays, under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The instant merchandise is a Liquid Crystal Display ("LCD") glass sandwich for a laptop computer display, designated as Sharp model number LM64P70. The "glass sandwich" consists of two pieces of glass, with internal electrodes, liquid crystals, and a polarizing filter. The glass sandwich is imported without the following components: the bezel, the cable connector, the LSI (Large Scale Integration chips), the diffuser, the rubber spacer, the light pipe, the reflector, the plastic chassis, the lamp, the lamp holder, the connector, and the wire.

ISSUE:

Are glass sandwiches for liquid crystal displays classified under heading 8531, HTSUS, which provides for electric sound or visual signaling apparatus, or under heading 8471, HTSUS, which provides for ADP output devices, or under heading 9013, HTSUS, which provides for liquid crystal devices, under the Harmonized Tariff Schedule of the United States (HTSUS)?

LAW AND ANALYSIS:

The General Rules of Interpretation (GRI's) to the HTSUS govern the classification of goods in the tariff schedule. GRI 1 states, in pertinent part:

...classification shall be determined according to the terms of the headings and any relative section or chapter notes...

Liquid crystal displays (LCDs) are prima facie classifiable under the following subheadings:

8531 Electric sound or visual signaling apparatus (for example, bells, sirens, indicator panels...

8531.20.00 Indicator panels incorporating liquid crystal devices (LCD's) or light emitting diodes (LED's).

9013 Liquid crystal devices not constituting articles provided for more specifically in other headings.

9013.80.60 Other devices, appliances and instruments: Other.

8471 Automatic data processing machines and units thereof.

8471.92.80 Other: Input or output units...: Other: Other: Units suitable for physical incorporation into automatic data processing machines or units thereof.

Heading 8531, HTSUS, provides for electric sound or visual signaling apparatus. Therefore, to be classifiable in this heading, the apparatus must be designed for "signaling."

The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) to heading 8531, HTSUS, page 1381, are fairly descriptive and restrictive as to the types of "signalling" indicator panels and the like must perform in order to be classifiable there. It states: "[t]hese 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...

(2) Number indicators. The signals appear as illuminated figures on the face of a small box; in some apparatus of this kind the calling mechanism is operated by the dial of a telephone. Also clock type indicators in which the numbers are indicated by a hand moving round a dial.

(3) Office indicators, for example, those used to indicate whether the occupant of a particular office is free or not...

(4) Lift indicators. These indicate, on an illuminated board, where the lift is and whether it is going up or down.

Therefore, only those LCDs which are limited by design and function to that of "signaling," are classifiable in heading 8531, HTSUS.

You argue that the instant Sharp LM64P70 glass sandwich is designed for ADP output displays (laptop and notebook computer displays). We agree. The instant glass sandwich exhibits the following ADP display characteristics: a pixel configuration of 640 X 480, a dot pitch of .27 to .30mm, a thin profile, light weight, a liquid crystal material mix with 150 to 200 milliseconds response time signal to signal, and low power consumption (5V). Therefore, it is not designed for or dedicated to signaling functions, and is not classifiable under heading 8531, HTSUS.

E.M. Chemicals v. United States, Appeal No. 90-1141, Cust. Bul. Vol. 24, No. 51, (1990), 728 F. Supp. 723 (1989), held that liquid crystals were classifiable under item 685.70, under the TSUS (the predecessor provision to heading 8531, HTSUS). However, there has been a significant change in the relevant tariff provisions under the HTSUS. In fact, there was no heading for "liquid Crystal Displays" (such as heading 9013, HTSUS), under the TSUS. Furthermore, LCDs have been technologically developed for a myriad of uses, many of which cannot be said to be for "signaling."

Heading 9013, HTSUS, provides for: "[l]iquid crystal devices not constituting articles provided for more specifically in other headings. The ENs to heading 9013, HTSUS, page 1478, state:

(1) Liquid crystal devices consisting of a liquid crystal layer sandwiched between two sheets or plates of glass or plastics, whether or not fitted with electrical connections, presented in the piece or cut to special shapes and not constituting articles described more specifically in other headings of the Nomenclature.

You argue that the instant LCD glass sandwich is a component part of an ADP display for notebook and laptop computers. We agree. However, the instant glass sandwich is not a finished or
even an unfinished ADP display. The instant LCD is imported without the following necessary components: the bezel, the cable connector, the LSI (Large Scale Integration chips), the diffuser, the rubber spacer, the light pipe, the reflector, the plastic chassis, the lamp, the lamp holder, the connector, and the connection wire. Therefore, the instant glass sandwich is found not to impart the essential character of a finished ADP output display. See HQ 086929, dated January 31, 1991, which held that a cathode ray tube for an ADP output unit was not classifiable as an unfinished ADP output device, and was instead classifiable in subheading 8540.30.00, HTSUS, which provides for other cathode- ray tubes.

You argue that, pursuant to Section XVI, Legal Note 2(a) regarding the classification of parts in chapters 84 and 85, the instant LCD glass sandwich is classifiable under subheading 8473.30.40, HTSUS, which provides for: "[p]arts and accessories... suitable for use solely or principally with machines of headings 8469 to 8472: [p]arts and accessories of the machines of heading 8471: [n]ot incorporating a cathode ray tube." However, Section XVI, Legal Note 2 states, in pertinent part: "Subject to note 1 to this section...." (Emphasis added). Section XVI, Legal Note 1 states, in pertinent part:

1. This section does not cover:

(m) Articles of chapter 90

Therefore, if the instant LCD glass sandwich is classifiable in chapter 90, it is not classifiable anywhere in Section XVI. Heading 9013, HTSUS, specifically provides for: "[l]iquid crystal devices not constituting articles provided for more specifically in other headings."

You argue that heading 8473, HTSUS, which provides for "parts and accessories...suitable for use solely or principally with the machines of headings 8469 to 8472," is more specific than heading 9013, HTSUS, which provides for "liquid crystal devices...." You cite the following cases to support your position: Beacon Cycle & Supply Co., Inc. v. United States, 458 F.Supp. 813 (1978), Rollix Bearing, Inc. v. United States, 757 F.Supp. 1412 (1991), Kores Manufacturing Corp. v. United States, 545 F.Supp. 1303 (1982), United States v. Porter, 645 F.2d 52 (1981). However, these cases represent the TSUS principle that although a parts provision does not prevail over a specific provision for that part, it does prevail over a basket provision for articles not specifically provided for. It is Customs position that heading 9013, HTSUS, which provides for liquid crystal displays, is not a basket provision, even though it contains the language "not constituting articles provided for more specifically in other headings."

Therefore, it is Customs position that heading 9013, HTSUS, which specifically provides for LCDs is more specific than heading 8473, HTSUS, which provides for the plethora of parts for the machines of headings 8469 to 8472, HTSUS. Therefore, the instant glass sandwiches are classifiable in chapter 90, and are consequently not classifiable anywhere in Section XVI. Thus, we disagree with your assertion on page 5 of your July 20, 1992, brief which stated that there is no Section XVI Legal Note applicable to chapter 90 [see Section XVI Legal Note 1.(m)].

You cite GRI 3(a), which states that where goods are classifiable under two or more headings, "[t]he heading which provides the most specific description shall be preferred to headings providing a more general description." It is Customs position that heading 9013, HTSUS, is a more specific provision than heading 8473, HTSUS. However, GRI 3(a) need not be consulted because the General Rules of Interpretation state, in pertinent part, the following:

Classification of goods in the tariff schedule shall be governed by the following principles:

1. ...for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes and, provided such headings or notes do not otherwise require, according to the following provisions.

Therefore, since Section XVI, Legal Note 1(m) requires that articles classifiable in chapter 90 are not classifiable in Section XVI, further GRIs need not be consulted.

You also cite Additional U.S. Rule of Interpretation 1.(c), which states, in part:

1. In the absence of special language or context which otherwise requires--

(c) a provision for parts of an article covers products solely or principally used as a part of such articles but a provision for "parts" or "parts and accessories" shall not prevail over a specific provision for such part or accessory.

However, we do consider heading 9013, HTSUS, to be a specific provision which prevails over heading 8473, HTSUS, (which provides for "parts"). It is also important to note that the Additional U.S. Rules of Interpretation are prefaced by the following language: "[i]n the absence of special language or context which otherwise requires--." Clearly, Section XVI, Legal Note 1(m) is "special language" which requires otherwise.

The Sharp LM64P70 glass sandwich is classifiable in subheading 9013.80.90, HTSUS. See HQ 951609, dated October 20, 1992, for our response to the port of Portland, Oregon, regarding this same issue. For other rulings regarding LCDs, see HQ 952360, dated July 7, 1992, and HQ 951288, dated July 7, 1992.

HOLDING:

The Sharp model LM64P70 glass sandwich is classifiable in subheading 9013.80.60, HTSUS, which provides for: "[l]iquid crystal devices not constituting articles provided for more specifically in other headings: [o]ther devices, appliances and instruments:

Sincerely,

John Durant, Director

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