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HQ 955108

October 19, 1993

CLA-2 CO:R:C:M 955108 DWS

CATEGORY: CLASSIFICATION

TARIFF NO.: 8517.81.00

Ms. Carma Randall
Robert E. Landweer & Co., Inc.
Customhouse Brokers
911 Western Avenue, Suite 208
Seattle, WA 98104

RE: Reconsideration of NY 885954; "SoundXchange"; Modification of HQ 953383; "Audioman"; Explanatory Note 85.17; Section XVI, Note 4; GRI 3(a); 8471.92.10; 8518.50.00; 8520.90.00

Dear Ms. Randall:

This is in response to your letters dated March 17, April 17, June 30, and August 27, 1993, on behalf of Interactive, Inc., to the Area Director of Customs, New York Seaport, requesting reconsideration of NY 885954, dated June 1, 1993, which involved the classification of models of the "SoundXchange" under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The merchandise consists of the "SoundXchange" (model nos. A and B). It is used for communication on a computer network, and it provides voice recording and playback capabilities for personal computers. Model A is designed for computers which already contain a sound board or for computers with built-in sound. Model B includes a sound board for installation into a personal computer.

Each model contains an amplified speaker, a microphone, a telephone handset, volume control, and an 1/8 inch jack for an optional headset. The amplified speaker allows for hands-free listening when the handset is hanging in its cradle, and it allows for audio notification of an important event or message. The built-in microphone is sensitive for hands-free use in a large office or a small cubicle. The telephone-style handset automatically turns off the amplified speaker and provides privacy when it is used. The optional headset allows for private hands- free communication. A bracket is supplied with each model so the "SoundXchange" may be mounted on the side of a personal computer monitor.

The base unit, the handset, the handset cord, the mounting bracket, the audio cable, and the AC power adapter of model A are imported from Taiwan. In the U.S., these components are combined with a user's manual, a mounting template, and final packaging.

The base unit, the handset, the handset cord, the mounting bracket, the small parallel cable, and the AC power adapter are imported from Taiwan. In the U.S., these components are combined with a user's manual, a floppy disk, a mounting template, and final packaging.

The subheadings under consideration are as follows:

8471.92.10: [a]utomatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data, not elsewhere specified or included: [o]ther: [i]nput or output units, whether or not entered with the rest of a system and whether or not containing storage units in the same housing: [c]ombined input/output units.

The general, column one rate of duty for goods classifiable under this provision is 3.7 percent ad valorem.

8518.50.00: [e]lectric sound amplifier sets.

The general, column one rate of duty for goods classifiable under this provision is 4.9 percent ad valorem.

8520.90.00: [m]agnetic tape recorders and other sound recording apparatus, whether or not incorporating a sound reproducing device: [o]ther.

The general, column one rate of duty for goods classifiable under this provision is 3.9 percent ad valorem.

8517.81.00: [e]lectrical apparatus for line telephony or telegraphy, including such apparatus for carrier-
current line systems; parts thereof: [o]ther apparatus: [t]elephonic.

The general, column one rate of duty for goods classifiable under this provision is 8.5 percent ad valorem.

ISSUE:

Whether the model A "SoundXchange" is classifiable under subheading 8471.92.10, HTSUS, as a combined input/output unit, under subheading 8518.50.00, HTSUS, as an electric sound amplifier set, or under subheading 8517.81.00, HTSUS, as an other telephonic apparatus.

Whether the model B "SoundXchange" is classifiable under subheading 8471.92.10, HTSUS, as a combined input/output unit, under subheading 8520.90.00, HTSUS, as an other sound recording apparatus, HTSUS, or under subheading 8517.81.00, HTSUS, as an other telephonic apparatus.

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 is determined according to the terms of the headings and any relative section or chapter notes.

In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes may be utilized. The Explanatory Notes, although not dispositive, are to be used to determine the proper interpretation of the HTSUS. 54 Fed. Reg. 35127, 35128 (August 23, 1989). In part, Explanatory Note 85.17 (p. 1360) states that:

[t]he term "electrical apparatus for line telephony or line telegraphy" means apparatus for the transmission between two points of speech or other sounds (or of symbols representing written messages, images or other data), by variation of an electric current or of an optical wave flowing in a metallic or dielectric (copper, optical fibres, combination cable, etc.) circuit connecting the transmitting station to the receiving station.

The heading covers all such electrical apparatus designed for this purpose, including the special apparatus used for carrier-current line systems. (emphasis supplied).

Section XVI, note 4, HTSUS, states that:

[w]here a machine (including a combination of machines) consists of individual components (whether separate or interconnected by piping, by transmission devices, by electric cables or by other devices) intended to contribute together to a clearly defined function covered by one of the headings in chapter 84 or chapter 85, then the whole falls to be classified in the heading appropriate to that function.

Based upon the description given in Explanatory Note 85.17, it is our position that both models of the "SoundXchange" are described under heading 8517, HTSUS. Although the merchandise is not a telephone, it is an "apparatus for the transmission between two points of speech or other sounds (or of symbols representing written messages, images or other data), by variation of an electric current . . . connecting the transmission station to the receiving station." As is stated in literature provided by the importer, the "SoundXchange" is designed for both the transmission and reception of voice communications through the use of a personal computer.

Also, both models of the "SoundXchange" are functional units as defined by section XVI, note 4, HTSUS. All of the components which are imported together to form the "SoundXchange" are intended to contribute together to the function of communication as defined under heading 8517, HTSUS.

In part, GRI 3(a) states that:

[t]he heading which provides the most specific description shall be preferred to headings with a more general description. . .

As is directed by GRI 3(a) and Explanatory Note 85.17, it is our position that both models of the "SoundXchange" are classifiable under heading 8517, HTSUS. Even if the merchandise is described under headings 8518, 8520, or 8471, HTSUS, it is precluded from classification under those headings, because Explanatory Note 85.17 states that if the merchandise is described under heading 8517, HTSUS, the merchandise is to be classified under that heading.

Consequently, we find that both models of the "SoundXchange" are classifiable under subheading 8517.81.00, HTSUS.

In HQ 953383, dated February 19, 1993, a similar product called the "Audioman" was held to be classifiable under subheading 8471.99.90, HTSUS, which provides for: "[a]utomatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data, not elsewhere specified or included: [o]ther: [o]ther: [o]ther: [o]ther."

The "Audioman", which is an external audio device with an integrated speaker and microphone, attaches to a personal computer and produces audio (voice, sound, and music) within a sound compatible application. A user can assign sounds or verbiage to a file with in the computer by utilizing corresponding software and inputting sound through the microphone. The user can then send the file to another user who possesses the "Audioman". That user can then hear the stored sound through the use of the "Audioman".

Based upon the reasoning in this ruling, it is now our position that the "Audioman" is classifiable under subheading 8517.81.00, HTSUS. Consequently, HQ 953383 is being modified in HQ 955232, of this date, a copy of which is enclosed.

HOLDING:

Model A and model B of the "SoundXchange" are classifiable under subheading 8517.81.00, HTSUS, as other telephonic apparatus.

EFFECT ON OTHER RULINGS

NY 885954 is affirmed.

Based upon the reasoning in this ruling, HQ 953383 is modified pursuant to section 177.9(d)(1), Customs Regulations

Sincerely,

John Durant, Director
Commercial Rulings Division

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