HQ 0952554 - Protest No. 0201-9X-XXXXXX; ECSL200 Optoelectronic Signal Converting Units; Control or Adapter Units; Automatic Data Processing Machine; Parts; ROSA; TOSA; HQ 951331; HQ 952659 - United States International Trade Commision Rulings

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HQ 952554

January 4, 1993

CLA-2 CO:R:C:M 952554 MBR

CATEGORY: CLASSIFICATION

TARIFF NO.: 8471.99.15; 8473.30.40

District Director
U.S. Customs Service
P.O. Box 1490
St. Albans, Vermont 05478

RE: Protest No. 0201-9X-XXXXXX; ECSL200 Optoelectronic Signal Converting Units; Control or Adapter Units; Automatic Data Processing Machine; Parts; ROSA; TOSA; HQ 951331; HQ 952659

Dear District Director:

This is in response to Protest Number 0201-9X-XXXXXX, dated April 2, 1992, regarding the classification of the ECSL200 Optoelectronic Signal Converting Unit and parts thereof, under the Harmonized Tariff Schedule of the United States (HTSUS).

We have recently reconsidered the classification of Local Area Network (LAN) equipment. See HQ 951331, dated September 18, 1992, as modified by HQ 952659, dated October 7, 1992.

FACTS:

The ECSL200 is a specially designed, assembled, optoelectronic signal converting module. "ECSL200" stands for "Early Corporate Serial Link" which operates at a nominal data stream bit rate of 200 megabits per second. The final printed circuit board (PCB) assemblies with attached ECSL200 modules are used exclusively in separately housed units (digital processing units, control units, disk storage units, etc.) of large mainframe ADP machines which are in the form of systems.

The IBM ECSL200 module contains two specifically designed electroptic subassemblies (used solely in the ECSL units). One of the subassemblies is an electroptic receptor referred to as a Receiver Optical Subassembly (ROSA). The other is an electroptic coherent electromagnetic radiation (amplified light) emitter referred to as a Transmitter Optical Subassembly (TOSA).

This protest governs both the importation of the ROSA and TOSA parts separately, and the importation of a complete ECSL200 module.

ISSUE:

Whether the IBM ECSL200 module and the TOSA and ROSA parts are classifiable as claimed under heading 8471, HTSUS, which provides for ADP machines and units thereof, or under heading 8473, HTSUS, which provides for parts of automatic data processing machines, or under heading 8517, HTSUS, as entered, which provides for telegraphic apparatus?

LAW AND ANALYSIS:

Legal Note 5(B) to chapter 84, HTSUS, provides guidance regarding the classification of automatic data processing machines. It states:

Automatic data processing machines may be in the form of systems consisting of a variable number of separately housed units. A unit is to be regarded as being a part of the complete system if it meets all of the following conditions:

(a) It is connectable to the central processing unit either directly or through one or more other units; and

(b) It is specifically designed as part of such a system (it must, in particular, unless it is a power supply unit, be able to accept or deliver data in a form (code or signals) which can be used by the system).

We agree that the ECSL200 module is essential to the ADP systems with which they are integrated because, when they are assembled with the PCB assembly, they perform ADP data acquisition and conversion and transmission.

The Harmonized Commodity Description and Coding System Explanatory Notes (ENs), pages 1299-1300, describe separately presented ADP units as follows:

This heading also covers separately presented constituent units of data processing systems. Constituent units are those defined in Parts (A) and (B) above as being parts of a complete system.

Apart from central processing units and input and output units, examples of such units include:

(4) Control and adaptor units such as those to effect interconnection of the central processing unit to other digital data processing machines, or to groups of input or output units which may comprise visual display units, remote terminals, etc.

Although these machines have certain subsidiary optical elements, such as a lens, they are not themselves "essentailly optical elements" [chapter 90, Legal Note 1(f)].

It is our opinion that the completed ECSL200 module does have the essential character of an ADP signal converting unit since it performs the actual signal conversion, transmission, and reception, and as such is classifiable under heading 8471, HTSUS, pursuant to chapter 90, Legal Note 2. Therefore, since the TOSA and ROSA parts themselves do not have the essential character of a finished ADP unit, they are classifiable under heading 8473, HTSUS, which provides for parts of ADP machines.

HOLDING:

The IBM ECSL200 TOSA and ROSA optoelectronic ADP signal converting parts are classifiable in subheading 8473.30.40, HTSUS, which provides for: "[p]arts and accessories (other than covers, carrying cases and the like) suitable for use solely or principally with the machines of headings 8469 to 8472: [p]arts and accessories of the machines of heading 8471: [n]ot incorporating a cathode ray tube." The rate of duty is Free.

The complete IBM ECSL200 module performs ADP signal conversion and has the essential character of an ADP unit. Therefore, it is classifiable under subheading 8471.99.15, HTSUS, which provides for: "[a]utomatic data processing machines and units thereof: [o]ther: [o]ther: [c]ontrol or adapter units." The rate of duty is Free.

The protest should be allowed in full. A copy of this decision should be attached to the Customs Form 19 and provided to the protestant as part of the notice of action on the protest.

Sincerely,

John Durant, Director

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