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HQ 953461


June 4, 1993

CLA-2 CO:R:C:M 953461 RFA

CATEGORY: CLASSIFICATION

TARIFF NO.: 8525.10.80, 8537.10.00

Mr. Ray Lewis
Northern Airborne Technology Ltd.
Suite 14
1925 Kirschner Road
Kelowna, B.C.
Canada V1Y 4N7

RE: Aircraft Audio Controller; Aircraft Tactical Control Heads; Radio Interface; Control Panels; EN 85.37; EN 85.25; Civil Aircraft Agreement ("CAA")

Dear Mr. Lewis:

In your letters dated December 9, 1992, and January 12, 1993, to the Area Director of Customs in New York, you inquired as to the tariff classification of devices for use in aircraft under the Harmonized Tariff Schedule of the United States (HTSUS). Your letters were referred to this office for a direct response.

FACTS:

According to your letters, there are three types of merchandise at issue: the AA90/AMS Series Aircraft Audio Controllers ("audio controllers"); the TAC/COM Aircraft Tactical FM Communication Control Heads ("control heads"); and the AA34- 200 Radio Interface for Aircraft Audio Systems ("radio interface").

The first type of merchandise is the audio controllers which allow a pilot of an aircraft to select and monitor the radios used for airborne communications (i.e., air traffic control or COM radio, FM communication for police or other emergency services) and navigation signals (i.e., Navaid) through the use of switches. It also provides an intercom system for communications between the various crew members through use of the headsets.

The second type of merchandise are the control heads which are installed in the aircraft to allow the pilot to control and select, through the use of switches, the operational characteristics of a variety of remote-mounted, airborne tactical FM radios. By using the control heads, the pilot can use the airborne tactical FM radios' functions such as power, volume, frequency selection and display, receive/transmit annunciation, and operational mode selection.

The third type of merchandise is the radio interface which accepts commercial radio signals such as emergency services of police, fire, and ambulance, and converts the audio frequency signal in order to make it compatible with the aircraft radio equipment.

ISSUE:

Is the subject merchandise classifiable as parts for aircraft or are they control panels and/or other radio transmission apparatus under the HTSUS?

LAW AND ANALYSIS:

Classification of merchandise under the HTSUS is in accordance with the General Rules of Interpretation (GRI's), taken in order. GRI 1 provides that classification shall be determined according to the terms of the headings and any relative section or chapter notes.

You suggest classification of all three types of merchandise under heading 8518, HTSUS, as other audio-frequency electric amplifiers. However, according to the principles of GRI 1, we find that this heading does not adequately describe the subject merchandise.

Subheading 8537.10.00, HTSUS, provides for: "[b]oards, panels (including numerical control panels). . .equipped with two or more apparatus of heading 8535 or 8536, for electric control or the distribution of electricity. . .: [f]or a voltage not exceeding 1,000 V. . ." The Harmonized Commodity Description and Coding System Explanatory Notes (EN) constitute the Customs Cooperation Council's official interpretation of the HTSUS. While not legally binding, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. EN 85.37, page 1391, states

[t]hese consist of an assembly of apparatus of the kind referred to in the two preceding headings (e.g., switches and fuses) on a board, panel, console, etc., or mounted in a cabinet, desk, etc. They usually also incorporate meters, and sometimes also subsidiary apparatus such as transformers, valves, voltage regulators, rheostats or luminous circuit diagrams.

The goods of this heading vary from small switchboards with only a few switches, fuses, etc. (e.g., for lighting installations) to complex control panels for machine-tools, rolling mills, power stations, radio stations, etc., including assemblies of several of the articles cited in the text of this heading.

According to the information provided, the first type of merchandise, the audio controllers, allows the pilot to select from a variety of radio frequencies used for airborne communications. The second set of merchandise is the Control Heads which allows the pilot to turn on and off the power to tactical FM radios, select the frequency desired, as well as receive/transmit annunciation. Based upon EN 85.37 and GRI 1, we find that the audio controllers and the control heads are classifiable as control panels under subheading 8537.10.00, HTSUS.

The third type of merchandise is the radio interface which converts commercial radio signals (i.e., AM/FM, police band, etc.) into a signal which is compatible with the aircraft communication system. Transmission apparatus of electro- magnetic signals is covered under heading 8525, HTSUS. EN 85.25(A), page 1374, states "[t]his apparatus is used for the transmission of signals. . .by means of electro-magnetic waves which are transmitted through the ether without any line connection." Based upon EN 85.25(A), we find that the radio interface is classifiable under subheading 8525.10.80, HTSUS, which provides for: "[t]ransmission apparatus for . . . radiobroadcasting. . .whether or not incorporating reception apparatus or sound recording or reproducing apparatus. . .: [t]ransmission apparatus: [o]ther: [o]ther. . ."

In your letter, you indicate that the merchandise is specifically designed to be used in aircraft. Parts of aircraft are provided for in heading 8803, HTSUS, which is in section XVII. Section XVII, Note 2(f) states that the expression "parts" does not apply to electrical machinery or equipment (chapter 85), whether or not they are identifiable as for the goods of section XVII. As stated above, all three types of the subject merchandise are classifiable in chapter 85. Therefore, they are precluded from being classified in heading 8803, HTSUS, as parts of aircraft.

However, some of the articles may be eligible for duty-free treatment under the Civil Aircraft Agreement ("CAA"). In order to be eligible for these benefits, it is important to note that in addition to the certification of use required under section 10.183(d) of the Customs Regulations [19 CFR 10.183(d)], and the approval for such use by the appropriate airworthiness authority, an imported article must be classifiable in a heading under the HTSUS listed in the United States Annex to the Agreement on Trade in Civil Aircraft. Heading 8537, HTSUS is not currently in the Annex. This means the negotiators did not intend to include goods, such as the audio controller and the control heads, within the scope of the CAA. However, heading 8525, HTSUS, is in the Annex. Provided that the other qualifications above are met, the radio interface may be eligible for duty-free treatment under the CAA.

HOLDING:

The audio controllers and control heads are classifiable under subheading 8537.10.00, HTSUS, which provides for control panels. The general, column one rate of duty is 5.3 percent ad valorem.

The radio interface is classifiable under subheading 8525.10.80, HTSUS, which provides for other transmission apparatus for electro-magnetic signals. The general, column one rate of duty is 6 percent ad valorem. However, if all of the requirements under the CAA are met, then the radio interface may be eligible for duty-free treatment.

Sincerely,

John Durant, Director
Commercial Rulings Division

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