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NY F89667




August 10, 2000

CLA-2-84:RR:NC:MM:110 F89667

CATEGORY: CLASSIFICATION

TARIFF NO.: 8470.10.0060; 8524.39.4000; 8524.99.4000

Ms. Jennifer F. Kessinger
Katten, Muchin and Zavis
525 West Monroe Street, Suite 1600
Chicago, IL 60661-3693

RE: The tariff classification of the Palm VII and Palm VIIx from Mexico, Ireland, Malaysia, and various other countries.

Dear Ms. Kessinger:

In your letter dated July 10, 2000, on behalf of your client Palm, Inc., you requested a tariff classification ruling.

The merchandise under consideration is the Palm VII and the Palm VIIx electronic handheld devices. Literature and a sample were submitted. The Palm VII and VIIx both measure 5.25 inches in height by 3.25 inches in width by .75 inches deep. The Palm VII and VIIx employ the Palm Operating System version 3.2.0 ("Palm OS") which allows the devices to function as electronic organizers. These Palm models also include a built-in two-way wireless radio with integrated antenna. They allow integrated wireless data access to the Internet without use of accessories. It is noted that the radio function is limited to Internet access and not employed in the basic organizer function. The Palm VII and VIIx organizer applications feature a date book, address book, memo pad, to do list, desktop e-Mail connectivity, expense tracking, calculator, HotSync software (allowing local and remote synchronization with a user's desktop computer), iMessenger application, Web clipping applications, and Internet-ready connectivity (with TCP/IP software to support Internet-based applications). The Palm VII and VIIx come with desktop organizer software (for installation on a desktop computer) which features a date book, address book, to do list, memo pad, expense report templates, drag and drop links to Microsoft Excel and Word programs, desktop import and export formats, TAB delimited, TXT, and desktop eMail connectivity. As per the handbook included with the sample, the software may be on a CD-ROM or diskettes. The only difference between the Palm VII and VIIx is the amount of storage capacity. The Palm VII features 2 MB while the Palm VIIx features 8 MB.

Although the Palm VII and VIIx may be imported separately, the devices are sold at retail as a set which includes: a Palm VII or VIIx handheld electronic device, a HotSync cradle, Palm Desktop organizer software, handbook, getting started guide, batteries, DB-25 adapter and a protective carrying case. In some instances, the Palm VII and VIIx may be imported as a set with the components listed above.

The Palm VII and VIIx are pocket-size organizers combined with a two-way wireless radio. As such they are composite machines under Section XVI, Note 3. Their principle function is that of the organizer, recording, reproducing and displaying.

The classification of goods put up in sets for retail sale is governed by GRI 3(b). It is the organizer that imparts the essential character of these sets. However, Chapter 85, Note 6 states that, “[r]ecords, tapes and other media of heading 8523 or 8524 remain classified in those headings, whether or not they are entered with the apparatus for which they are intended.”

The applicable subheading for the Palm VII and Palm VIIx when imported separately or as a set will be 8470.10.0060, Harmonized Tariff Schedule of the United States (HTS), which provides for “pocket-size data recording, reproducing and displaying machines with calculating functions[o]ther.” The rate of duty will be free.

The applicable subheading for the Palm Desktop organizer software on a CD ROM will be 8524.39.4000, Harmonized Tariff Schedule of the United States (HTS), which provides for “[r]ecords, tapes and other recorded media for sound or other similarly recorded phenomena[d]iscs for laser reading systems: [o]ther: [f]or reproducing representations of instructions, data, sound, and image, recorded in a machine readable binary form, and capable of being manipulated or providing interactivity to a user, by means of an automatic data processing machine.” The rate of duty will be free.

The applicable subheading for the Palm Desktop organizer software on diskettes will be 8524.99.4000, Harmonized Tariff Schedule of the United States (HTS), which provides for “[r]ecords, tapes and other recorded media for sound or other similarly recorded phenomena[o]ther: [o]ther: [o]ther.” The rate of duty will be free.

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).

A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Eileen S. Kaplan at 212-637-7019.

Sincerely,

Robert B. Swierupski
Director,

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