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HQ 958836





May 3, 1996

CLA-2 RR:TC:MM 958836 RFA

CATEGORY: CLASSIFICATION

TARIFF NO.: 8531.20.00, 9013.80.60

Port Director
U.S. Customs Service
P.O. Box 2450
San Francisco, CA 94126

RE: Protest 2809-95-101360; Liquid Crystal Display (LCD) Panel for Keyboards and Server Machine; Signaling Apparatus; Headings 8471, 8473, 8531, and 9013; Legal Note 1(m) to section XVI; EN 85.31; HQs 958953, 957435, 956696, 954638, 952973, 952722, 951868, 951609, 952360, 954788, 953115, 952502, and 951288

Dear Port Director:

The following is our decision regarding Protest 2809-95-101360, which concerns the classification of two LCD panels under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The subject merchandise consists of two passive matrix liquid crystal display (LCD) panels, model DMC 40401N and DMC 20481U-SLY-6. Both have a printed circuit board (PCB), row and column driver integrated circuits (ICs), controller ICs, ROM and RAM chips, and mounting bezel. The DMC 40401N also contains backlighting.

Model DMC 40401N is designed for use in an automatic data processing (ADP) keyboard. The keyboard functions as an early-generation, limited feature word processor which is designed to permit entry of alphanumeric text independent of a central processing unit (CPU). After the text is entered into onboard RAM in the keyboard, the keyboard uploads the data into a file on the CPU. The LCD displays the text being entered into the keyboard RAM. According to the specification sheet, it has a display format of 40 characters by 4 lines. The LCD module's dimensions are 190mm x 54mm x 11mm.

Model DMC 20481U-SLY-6 is designed for use in an ADP server machine. This LCD module will indicate data such as error messages, user identification information, data readouts, and volume of usage. According to the specification sheet, it has a display format of 20 characters by 4 lines. The LCD module's dimensions are 98.5mm x 61mm x 16.5mm.

The merchandise was entered under subheading 8471.92.30, HTSUS, as an ADP non-CRT display panel, with a diagonal not exceeding 30.5 cm. The entry was liquidated on June 30, 1995, under subheading 9013.80.60, HTSUS, as LCDs. The protest was timely filed on September 27, 1995.

The subheadings under consideration are as follows:

8471: Automatic 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:

8471.92.30: Input or output units, whether or not entered with the rest of a system and whether or not containing storage units in the same housing: [o]ther: [d]isplay units: [w]ithout cathode-ray tube (CRT), having a visual display diagonal not exceeding 30.5 cm. . . .

Goods classifiable under this provision have a general, column one rate of duty of free.

8471.99.60: Other: [o]ther: [o]ther: [u]nits suitable for physical incorporation into automatic data processing machines or units thereof. . . .

Goods classifiable under this provision have a general, column one rate of duty of free.

8473.30.45 Parts and accessories (other than covers, carrying cases and the like) suitable for use solely or principally with machines of headings 8469 to 8472: [p]arts and accessories of the machines of heading 8471: [n]ot incorporating a cathode ray tube:
[o]ther: [p]arts of power supplies for automatic data processing machines: [o]ther. . . .

Goods classifiable under this provision have a general, column one rate of duty of free.

8531.20.00 Electric sound or visual signaling apparatus (for example, bells, sirens, indicator panels, burglar or fire alarms), other than those of heading 8512 or 8530. . . :
[i]ndicator panels incorporating liquid crystal devices (LCD's) or light emitting diodes (LED's). . . .

Goods classifiable under this provision have a general, column one rate of duty of 2.4 percent ad valorem.

9013.80.60 Liquid crystal devices not constituting articles provided for more specifically in other headings; lasers, other than laser diodes; other optical appliances and instruments, not specified or included elsewhere in this chapter . . . : [o]ther devices, appliances and instruments: [o]ther. . . .

Goods classifiable under this provision have a general, column one rate of duty of 8.1 percent ad valorem.

ISSUE:

Whether the LCD panel is classifiable as parts of typewriters, or as a visual signaling indicator panel, or as LCDs not constituting articles provided for more specifically in other headings, under the HTSUS?

LAW AND ANALYSIS:

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

The consistently stated general rule is that unless a principal use for signaling (heading 8531, HTSUS) or as an automatic data processing output unit (heading 8471, HTSUS) can be established satisfactorily either by design limitation or other reliable means, liquid crystal displays are classifiable under heading 9013, HTSUS, as other liquid crystal devices not constituting articles provided for more specifically in other headings. See HQ 951288 (July 7, 1992); HQ 952246 (November 10, 1992), modified in HQ 952973 (August 5, 1993); HQ 952502 (March 18, 1993); and HQ 954638 (December 2, 1993).

To be classified as an LCD display under heading 8471, Customs has consistently held that an LCD must meet the following criteria: pixel configuration (640 x 480), dot pitch (.27 mm to .30 mm), thin profile, light weight, liquid crystal material mix (150 to 200 milliseconds response time signal to signal), and low power consumption (5V). See HQ 956696 (May 12, 1995); HQ 951609 (October 20, 1992); HQ 951868 (October 31, 1992); HQ 952246 (modified in HQ 952973); and HQ 952502. The subject LCD panels do not meet this criteria due to their small size and limited number of lines and characters. Therefore, we find that they are not classifiable under heading 8471, HTSUS.

Subheading 8531.20.00, HTSUS, provides for "[e]lectric sound or visual signaling apparatus...[i]ndicator panels incorporating liquid crystal devices (LCD's)...." Therefore, to be classified in this subheading, the LCDs must be designed for "signaling."

In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System (HCDCS) Explanatory Notes (ENs) may be consulted. The ENs, although not dispositive, provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of the HTSUS. See, T.D. 89-80, 54 F R 35127, 35128 (August 23, 1989). EN 85.31, page 1381, is fairly descriptive and restrictive as to the types of "signaling"/indicating panels and the function they must perform in order to be classifiable in heading 8531, HTSUS. EN 85.31 states indicator panels and the like: "[a]re used (e.g., in offices, hotels and factories) for calling personnel, indicating where a certain person or service is required, indicating whether a room is free or not. They include:

(1) Room indicators. There are large panels with numbers corresponding to a number of rooms. When a button is pressed in the room concerned the corresponding number is either lit up or exposed by the falling away of a shutter or flap.

(2) Number indicators. The signals appear to 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. Also clock type indicators in which the numbers are indicated by a hand moving round a dial.

(3) Office indicators, for example, those used to indicate whether the occupant of a particular office is free or not. Some types are merely a simple "come in" or "engaged" sign illuminated at will by the occupant of the office.

(4) Lift indicators. These indicate, on an illuminated board, where the lift is and whether it is going up or down.

(5) Engine room telegraph apparatus for ships.

(6) Station indicating panels for showing the times and platforms of trains.

(7) Indicators for race course, football stadiums, bowling alleys, etc.

Certain of these indicator panels, etc., also incorporate bells or other sound signaling devices (emphasis in original).

Therefore, only those LCD's which are principally used and/or limited by design to "signaling" are classifiable under subheading 8531.20.00, HTSUS. See HQ 954788, dated December 1, 1993; HQ 953115, dated May 10, 1993; HQ 952502; HQ 951868, dated October 31, 1992; HQ 952360, dated October 15, 1992; and HQ 951288. In HQ 958953, dated April 25, 1996, and in HQ 957435, dated August 8, 1995, Customs determined that certain LCDs which were designed and used for electric typewriter displays, were not principally used or designed as signaling indicator panels. The LCDs classifiable under subheading 8531.20.00, HTSUS, display limited indication information to a user, i.e., measurement, coordinates, flow rate, etc. The basis for these decisions was that the LCDs for electric typewriters displayed more information than typical signaling panels.

We find that Model DMC 40401N, which is used to display text from a keyboard, is similar to the LCD displays for electric typewriters in HQ 958953 and HQ 957435. Based upon HQ 958953 and HQ 957435, the Model DMC 40401N does not meet the terms of signaling apparatus of heading 8531, HTSUS. Because this LCD displays more information than typical signaling panels, we find that the Model DMC 40401N is classifiable under heading 9013, HTSUS, as LCDs not constituting articles provided for more specifically in another heading.

However, the Model DMC 20481U-SLY-6 indicates limited information such as error messages, user identification information, data readouts, and volume of usage. According to the specification sheet, the DMC 20481U-SLY-6 has a display format of 20 characters by 4 lines. In HQ 954638, dated December 2, 1993, Customs stated that: "LCDs having 80 or less characters are restricted to signaling functions by virtue of their operational limitations. Clearly, the instant LCDs contain less than 80 characters, but even more importantly, the principal use of all of the instant LCDs is that of signaling in such apparatus as cameras, industrial controls, medical instrumentation, diving equipment and electronic price tags. Furthermore, we have previously held that LCD electronic price tags are classifiable as signaling apparatus (see HQ 088225, dated January 31, 1991)." See also HQ 952973 (August 5, 1993).
Based upon HQ 954638, we find that the Model DMC 20481U-SLY-6 is classifiable under heading 8531, HTSUS, as signaling apparatus because it contains 80 characters and displays limited information.

The protestant contends that the LCDs are classifiable as parts of ADP units under heading 8473, HTSUS. However, Legal Note 1(m) to section XVI, HTSUS, states that: "[t]his section does not cover: [a]rticles of chapter 90." Heading 9013, HTSUS, provides for: "[l]iquid crystal devices not constituting articles provided for more specifically in other headings." Therefore, if the subject merchandise is provided for more specifically in another heading, it would not be classifiable in heading 9013, HTSUS. It is Customs position that heading 8473, HTSUS, which provides for "parts," is not a more specific heading than heading 9013, HTSUS. Therefore, because the subject merchandise is classifiable in heading 9013, HTSUS, it is not classifiable in heading 8473, HTSUS, which falls in section XVI, HTSUS. See HQ 958953; HQ 957435; HQ 952973; HQ 951609; HQ 952360; and HQ 951868. As to the claim of applying GRI 3(a), we note that classification of the above merchandise is resolved through the application of GRI 1, the terms of the headings, and the relevant section and chapter notes. Therefore, there is no need for Customs to apply the other GRI's.

HOLDING:

LCD Model DMC 20481U-SLY-6 is classifiable under subheading 8531.20.00, HTSUS, which provides for: "[e]lectric sound or visual signaling apparatus (for example, bells, sirens, indicator panels, burglar or fire alarms), other than those of heading 8512 or 8530. . . : [i]ndicator panels incorporating liquid crystal devices (LCD's) or light emitting diodes (LED's). . . ."

LCD Model DMC 40401N is classifiable under subheading 9013.80.60, HTSUS, which provides for: "[l]iquid crystal devices not constituting articles provided for more specifically in other headings; lasers, other than laser diodes; other optical appliances and instruments, not specified or included elsewhere in this chapter . . . : [o]ther devices, appliances and instruments: [o]ther. . . ."

The protest should be DENIED, except to the extent that reclassification of the LCD Model DMC 20481U-SLY-6 as indicated above results in a partial allowance. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision, together with the Customs Form 19, should be mailed by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, Freedom of Information Act and other public access channels.

Sincerely,

John Durant, Director
Tariff Classification Appeals

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