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HQ 954390




October 7, 1993

CLA-2 CO:R:C:M 954390 MBR

CATEGORY: CLASSIFICATION

TARIFF NO.: 8531.20.00

Mr. Roger Silvestri
Assistant Area Director
National Import Specialist Division
U.S. Customs Service
6 World Trade Center
New York, N.Y. 10048

RE: Call Display Unit; Signalling Apparatus; Telephonic Apparatus; NEC America, Inc. v. United States; 8531; 8517; NY 858341; HQ 088520; HQ 952779; HQ 952406; HQ 953366; HQ 953444

Dear Mr. Silvestri:

This is in reply to your memorandum of June 4, 1993, (CLA-2-85:S:N:N1B 112-953366), requesting reconsideration of HQ 953366, dated April 5, 1993, regarding the classification of a Call Display Unit, under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The telephone "Call Display" unit is a device that displays the telephone number of a calling party on a liquid crystal display (LCD). A coded representation of the calling party's telephone number is sent on the telephone line to the unit, which plugs into a standard modular wall jack. The caller's number is stored in chip memory so that the user can review the information at a later date. The Call Display also records the time and date of call. The unit does not require the attachment of a telephone in order to operate properly.

ISSUE:

Is the Call Display Unit classifiable under heading 8531, HTSUS, as electric sound or visual signalling apparatus, or under heading 8517, HTSUS, as electrical apparatus for line telephony?

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...

In NY 858341, dated December 11, 1990, it was held that the Caller ID Unit was classifiable in heading 8517, HTSUS, which provides for electrical apparatus for line telephony.

Subsequently, in HQ 088520, dated September 10, 1991, we revoked NY 858341, and classified a similar telephone "Caller ID" unit in heading 8531, HTSUS, which provides for signalling apparatus.

In HQ 952779, dated October 31, 1992, we reconsidered HQ 088520, and held that the Caller ID Unit was classifiable as electrical apparatus for line telephony in heading 8517, HTSUS.

Similarly, in HQ 952406, dated October 31, 1992, we held that a Caller ID Unit was classifiable as electrical apparatus for line telephony in heading 8517, HTSUS.

However, in HQ 953366, dated April 5, 1993, we revoked HQ 952779, and held that the Caller ID Unit was classifiable in heading 8531, HTSUS, which provides for signalling apparatus. Additionally, HQ 953444, also dated April 5, 1993, revoked HQ 952406.

You now request reconsideration of HQ 953366, based upon the following principle:

"If we were to follow Headquarters decision 953366 all types of apparatus or instruments that incorporate a digital readout panel such as thermometers, blood pressure machines, volt, ampere, and watt meters, odometers, speedometers, clocks, calculators and other similar devices would have to be considered signalling apparatus under heading 8531."

However, the court in NEC America, Inc. v. United States, 11 CIT 934 (1987), held that battery operated paging receivers were classifiable under item 685.24, TSUS, which provides for "other solid-state (tubeless) radio receivers." Item 685.70, TSUS, is the predecessor provision to heading 8531, HTSUS. The court in NEC America, citing the prior NEC America, Inc. v. United States, 8 CIT 184, 596 F. Supp. 466 (1984), stated:

After examining prior case law, the court indicated that classification under item 685.70, TSUS, was "limited to those articles whose sole purpose and function is merely signalling." Hence, the court concluded that the superior capabilities of the display pagers in issue, with their ability to display information in digital form and to retain it for later recall, clearly "transcend merely signalling." (Emphasis added).

Therefore, as the court has interpreted the "signalling" provision to be "limited to those articles whose sole purpose and function is merely signalling," we do not anticipate that all other apparatus with a liquid crystal display will be classifiable in heading 8531, HTSUS. In fact, the court found that a radio display pager "transcended merely signalling." Thus, similarly, the apparatus enumerated (thermometers, blood pressure machines, volt, ampere, and watt meters, odometers, speedometers, clocks, calculators and other similar devices) would also transcend merely signalling.

In HQ 953366, which provides the current precedent for the classification of Caller ID Units, we stated:

A consideration of the distinctions between the merchandise at issue under the TSUS provisions in NEC, and the Caller I.D. devices at issue under the legal principles of the HTSUS, leads to a finding that NEC is not analogous to the instant matter. At issue in NEC was the classification of radio receiver pagers which received and stored coded messages, stock quotations and telephone numbers. The instant matter involves Caller I.D. devices which must be classified under the governing principles of the HTSUS.

In HQ 953366 we also relied heavily on the Harmonized Commodity Description and Coding System Explanatory Notes {"ENs") regarding heading 85.31, page 1382, which state that signalling apparatus includes:

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.

Although not dispositive, the ENs are to be used for guidance in determining the proper interpretation of the HTSUS. 54 Fed. Reg. 35128 (August 23, 1989).

The court in NEC did not have the benefit of an EN such as the one above, in which the imported merchandise squarely fits. Thus, under the guidance of the ENs and the judicial decisions, HQ 953366 is affirmed.

You also request reconsideration of HQ 953366, based upon the following principle:

"Following GRI 3(b) we have a problem accepting the above decision. GRI 3(c) only comes into play when the essential character/function of a composite item cannot be established."

However, in HQ 953366 we did not resort to GRI 3(b) or GRI 3(c) in our analysis. In HQ 953366 we stated the following: "[a]lthough the devices appear to be prima facie described by heading 8517, HTSUS, they are still classified in heading 8531, HTSUS, where they are more specifically provided for pursuant to GRI 3." Thus, we relied on GRI 3(a), which provides that: "[t]he heading which provides the most specific description shall be preferred to headings providing a more general description."

HOLDING:

Signalling apparatus whose sole purpose and function is merely signalling, and particularly apparatus which is enumerated in the ENs in heading 85.31, is properly classifiable in heading 8531, HTSUS. The Call Display Unit is classifiable in subheading 8531.20.00, HTSUS, which provides for signalling apparatus. HQ 953366, dated April 5, 1993, is hereby affirmed.

Sincerely,


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