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HQ 958321




February 5, 1996

CLA-2 RR:TC:MM 958321 LTO

CATEGORY: CLASSIFICATION

TARIFF NO.: 8527.90.90

Mr. Jerry Killion
Sanyo Manufacturing Corporation
2001 Sanyo Avenue
San Diego, California 92173

RE: "VideoGuide;" headings 8525, 8537; HQs 087724, 088255, 952293, 952302, 952441, 956091, 957743; GRI 3; EN to GRI 3; section XVI, note 4; EN 85.27

Dear Mr. Killion:

This is in response to your letter of July 21, 1995, requesting the classification of the "VideoGuide" under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The "VideoGuide" is a device that "enhances TV viewing, simplifies VCR recording, and provides easy access to important news, weather, and up-to-date sports scores." The "VideoGuide" consists of a base unit, which plugs directly into a television or monitor set, and a hand held, infrared remote control device. The "VideoGuide" can display, depending on the subscriber's needs, a television program guide, sports guide and/or news guide onto the television or monitor.

The base unit, which has a built-in antenna, receives the program, sports and news information via radio signal (using the same radio frequency used by paging services--wireless paging frequency 931.8875 MHz). The unit then selectively stores the signal and, when accessed by the remote control, displays the information on the television or monitor. The VideoGuide does not convert, decode, encode or amplify any signal or data. - 2 -

The remote control permits the user to scan seven days of television listings (including complete show descriptions) or access the sports or news guide (up-to-the-minute scores, news, etc.). The remote control can also be used to control all "remote-controllable" television and video cassette recorder (VCR) functions (changing channels, volume, etc.). The user can perform one-touch VCR programming by selecting a show from the program guide and simply pressing the "left action" (record) button on the remote control.

ISSUE:

Whether the "VideoGuide" is classifiable, according to GRI 3(b), as television transmission apparatus under heading 8525, HTSUS, or as reception apparatus for radiotelephony, radiotelegraphy or radiobroadcasting under heading 8527, 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, that "for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes . . . ."

The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not legally binding, and therefore not dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System, and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).

The headings under consideration are as follows:

8525 Transmission apparatus for radiotelephony, radiotelegraphy, radiobroadcasting or television, whether or not incorporating reception apparatus or sound recording or reproducing apparatus . . .

8527 Reception apparatus for radiotelephony, radiotelegraphy or radiobroadcasting, whether or not combined, in the same housing, with sound recording or reproducing apparatus or a clock

8537 Boards, panels (including numerical control panels), consoles, desks, cabinets and other bases, equipped with two or more
apparatus of heading 8535 or 8536, for electric control or the distribution of electricity . . .

The "VideoGuide" consists of a base unit and hand held, remote control. The base unit, which has a built-in antenna, receives over-the-air information via radio signal. The unit then selectively stores the signal and, when accessed by the remote control, displays the information directly on the television or monitor. The unit, which plugs directly into the television or monitor, does not convert, decode, encode or amplify any signal or data. Consequently, the VideoGuide does not perform a "transmission" function, and therefore, cannot be classified under heading 8525, HTSUS.

You contend that the "VideoGuide" is classifiable as radio reception apparatus under heading 8527, HTSUS, as the unit receives the program, sports and news information via radio signal (using the same radio frequency used by paging services--wireless paging frequency 931.8875 MHZ). We agree. The base unit "is used for the reception of signals (representing speech, messages or still pictures) by means of electro-magnetic waves which are transmitted through the ether without any line connection." See EN 85.27, pg. 1377. Accordingly, the unit, which is at the end of the transmission path, is prima facie classifiable under heading 8527, HTSUS. See HQ 088255, dated December 17, 1990 (concerning the classification of a device that was not at the end of the transmission path).

With regard to the classification of the remote control, Customs has classified infrared remote control devices under heading 8537, HTSUS. See HQ 952293, dated October 31, 1994; HQ 952302, dated November 2, 1992; HQ 952441, dated November 2, 1992; and HQ 087774, dated March 13, 1991. Thus, the remote control is prima facie classifiable under heading 8537, HTSUS. Similar merchandise is currently the subject of an action before the U.S. Court of International Trade in Universal Electronics Inc. v. U.S. (Court No. 93-11-00740).

In HQ 956091, dated December 13, 1994, we classified an electronic currency rate board and its remote control, according to note 4 to section XVI, HTSUS, under heading 8531, HTSUS, which provides for electric sound or visual signaling apparatus. Note 4 to section XVI, HTSUS, provides as follows:

Where 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. - 4 -

Unlike the apparatus of HQ 956091, the VideoGuide's base unit and remote control do not contribute to a "clearly defined function" covered by a single heading of chapter 84 or 85. The remote control performs a function entirely unrelated to the radio reception function performed by the base unit and described by heading 8525, HTSUS. The remote control functions as a "universal" remote control device that controls all "remote-controllable" television and VCR functions. The remote control involved in HQ 956091, which changed the information on the currency rate boards, was dedicated entirely to the signaling function. Thus, the base unit and remote control cannot be classified by reference to note 4 to section XVI, HTSUS.

As there is no single heading that covers the "VideoGuide's" base unit and remote control, it is necessary to resort to GRI 3, HTSUS, which governs the classification of goods that are, prima facie, classifiable under two or more headings. GRI 3(a) requires that the heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the components contained in a composite good, those headings are to be regarded as equally specific in relation to those goods. Headings 8527 and 8537, HTSUS, each refer to part only of the components of the VideoGuide. Accordingly, no heading provides a specific description of the system.

GRI 3(b), HTSUS, provides that "composite goods consisting of different materials or made up of different components, . . . which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable." The "VideoGuide" consists of components that are separable, but which are "adapted one to the other and are mutually complementary," in that the remote control units use laser diodes to transmit a beam of light to the base unit which "accepts" the beam using a photodiode. See EN to GRI 3(b), pg. 4. Moreover, the remote control, which has a "Guide" button that allows the user to enter the television program, sports or news guides, as well as joystick that allows the user to make selections while recording or using the "VideoGuide," is specially designed to interact with the "VideoGuide's" base unit. Thus, "the design and intended use of these components would prevent them from normally being sold separately." See HQ 957743, dated September 6, 1995. Thus, the "VideoGuide" is a GRI 3(b) composite good, and it is classifiable as if consisting solely of the "base unit," the component which imparts its "essential character." Accordingly, the "VideoGuide" is classifiable under heading 8527, HTSUS, specifically under subheading 8527.90.90, HTSUS, which provides for other radio reception apparatus.

HOLDING:

The "VideoGuide" is classifiable, according to GRI 3(b), HTSUS, under subheading 8527.90.90, HTSUS, which provides for other radio reception apparatus. - 5 -

The corresponding rate of duty for articles of this subheading is 6% ad valorem.

Sincerely,

John Durant, Director

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