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HQ 965190

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March 9. 2002

CLA-2 RR:CR:GC 965190 TPB

CATEGORY: CLASSIFICATION

TARIFF NO.: 8463.90.00

Port Director
U.S. Customs Service
Los Angeles-Long Beach Seaport
301 East Ocean Boulevard, 14th Floor
Long Beach, California 90802

RE: Protest 2704-01-100920; Roland DGA; MPX-50 Photo Impact Printer.

Dear Port Director:

This is our decision on Protest 2704-01-100920, filed on behalf of Roland DGA Corporation, against your classification under the Harmonized Tariff Schedule of the United States (“HTSUS”), of the MPX-50 Photo Impact Printer.

FACTS:

The merchandise at issue is the Roland MPX-50 photo impact printer. The entry was filed on October 23, 2000 and liquidated January 5, 2001, under subheading 8463.90.00, HTSUS, which provides for other machine tools for working metals or cements, without removing material, other. The protest was timely filed on March 30, 2001.

Counsel for the protestant describes the merchandise as a desktop photo impact printer, which will permanently imprint virtually any image or text on flat surfaced objects without using ink or removing any material. The product literature contains the following description:

The MPX-50’s diamond-tipped stylus strikes the marking surface at high speed with variable force to realistically reproduce the delicate gradations of halftone, line art and/or text on flat surfaces of acrylic, aluminum, stainless steel, brass

The protestant stresses that the MPX-50 can be used to imprint on a variety of materials, including non-ferrous metals, plastic, vinyl, acrylic and other soft materials.

Counsel claims that because the MPX-50 is attached to and works with a computer, it should properly be classified under subheading 8471.60.90, HTSUS, which provides for automatic data processing machines and units thereof, input or output units, whether or not containing storage units in the same housing, other, other output devices. In the alternative, counsel claims that because the MPX-50 can print on a variety of media, it has no principal purpose, and would thus be properly classified under subheading 8479.89.97, HTSUS, which provides for machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter, parts thereof, other, other.

ISSUE:

Is the MPX-50 properly classified under heading 8463, HTSUS, which provides for other machine tools for working metals or cements without removing material; heading 8471, HTSUS, which provides for automatic data processing machines and units thereof; or 8479, HTSUS, which provides for machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter (ch. 84, HTSUS).

LAW AND ANALYSIS:

Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (“HTSUS”) in accordance with the General Rules of Interpretation (“GRIs”). GRI 1 states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6. GRI 2(a) states in part that incomplete or unfinished articles are to be classified as complete or finished if, as imported, they have the essential character of the complete or finished article. GRI 6 permits the comparison of same-level subheadings within the same heading, in part by application of Rules 1 through 5, applied by appropriate substitution of terms.

The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the Harmonized System at the international level. While not legally binding, the ENs provide a commentary on the scope of each heading of the Harmonized System and are thus useful in ascertaining the classification of merchandise under the HTSUS. Customs believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989). The HTSUS headings under consideration are as follows:

8463 Other machine tools for working metal or cements, without removing material:

8471 Automatic data processing machines and units thereof:

8479 Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof:

Counsel’s first argument is that the MPX-50 is properly classifiable under heading 8471, HTSUS, as an output unit of an automatic data processing (“ADP”) machine because the essential function of the MPX-50 is as a printer that converts the signals provided by an attached computer into an intelligible form, i.e., letters and/or designs that the MPX-50 imprints onto various media.

Heading 8471, HTSUS, is governed by the terms of Legal Note 5 to Chapter 84, HTSUS, which provides, in relevant part:

5(B) Automatic data processing machines may be in the form of systems consisting of a variable number of separate units. Subject to paragraph (E) below, a unit is to be regarded as being a part of a complete system if it meets all the following conditions:

It is of a kind solely or principally used in an automatic data processing system;

It is connectable to the central processing unit either directly or through one or more other units; and

It is able to accept or deliver data in a form (codes or signals) which can be used by the system.

(D) Printers, keyboards, XY coordinate input devices and disk storage units which satisfy the conditions of paragraphs (B)(b) and (B)(c) above, are in all cases to be classified as units of heading 8471.

(E) Machines performing a specific function other than data processing and incorporating or working in conjunction with an automatic data processing machine are to be classified in the headings appropriate to their respective functions or, failing that, in residual headings.

The General EN (E) to Chapter 84, HTSUS, provides in pertinent part:

(1) A machine incorporating an automatic data processing machine and performing a specific function other than data processing is classifiable in the heading corresponding to the function of that machine or, in the absence of a specific heading, in a residual heading, and not in heading 84.71.

Note 5(D) to Chapter 84, HTSUS, is subject to Note 5(E). Accordingly, if a machine performs a specific function other than data processing and incorporates or works in conjunction with an automatic data processing machine, it is to be classified in the heading corresponding to the function of the machine, or failing that, in residual headings, and not in heading 8471, HTSUS. See HQ 963280 dated September 26, 2001.

The MPX-50 satisfies Note 5(D) to Chapter 84, HTSUS, in that it meets the requirements of paragraphs (B)(b) and (B)(c) of Note 5 to Chapter 84, HTSUS. It is directly connectable to a central processing unit and is able to accept data in a form which can be used by the system. However, it is our opinion that the photo impact printer is excluded from classification under heading 8471, HTS, by virtue of Note 5(E) to Chapter 84, HTSUS. The merchandise in this case clearly performs a specific function other than data processing, i.e. the MPX-50 is designed to produce finished, commercial products.

The legal text of heading 8463, HTSUS, provides for machine tools that work metal without removing material. In this case, the MPX-50’s diamond-tipped stylus “works” the marking surface by deforming it, without removing any material. This meets the terms of that heading.

Counsel argues that case law dictates that plotting machines that are similar in function to the MPX-50 are classifiable under heading 8471, HTSUS, and not excluded by Note 5(E) to Chapter 84, HTSUS, because they did not perform a “specific function”. See Sumitronics, Inc. v. United States, 19 C.I.T. 122, 1995, Slip Op. 95-10; Apple Computer, Inc. v. United States, 14 C.I.T. 77, 1990, Slip Op. 90-14; Hewlett-Packard Co. v. United States, 22 C.I.T. 514, 1998, Slip Op. 98-76, aff’d 189 F.3d 1346 (C.A.F.C. 1999).

However, we do not feel those cases are applicable in this situation. Contrary to counsel’s assertion, as Sumitronics and Apple were decided under the HTSUS predecessor, the Tariff Schedules of the United States (“TSUS”), those cases contained no discussion of Chapter 84, Note 5(E). Hewlett-Packard, a HTSUS case, likewise contained no such discussion. The cited cases merely found that the machines at issue were not drafting or drawing machines for tariff purposes, before moving to a discussion of why they were parts of automatic data processing (“ADP”) machines/office machines, and output devices for ADP machines, respectively. Conversely, it can be reasoned that had the Court found that the plotters met the terms of the heading in Chapter 90, it would have applied Note 5(E).

The MPX-50 clearly meets the terms of heading 8463, and thus, Note 5(E) to chapter 84 applies. The MPX-50 is a machine tool that works in metal. It performs a specific function other than data processing, i.e. it manufactures finished commercial goods, and therefore, is precluded from classification under 8471, HTSUS, by that note.

For the foregoing reasons, we conclude that classification of the MPX-50 under heading 8471, HTSUS, is precluded by virtue of Note 5(E) to Chapter 84, HTSUS. We next address Protestants alternate claim that the MPX-50 is properly classifiable under heading 8479, which provides for machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter and parts thereof. Protestant argues that because the MPX-50 is capable of printing not only on metal, but various other soft media such as plastic, acrylic and vinyl, classification is governed by Note 7 to Chapter 84, HTSUS, which provides as follows:

A machine which is used for more than one purpose is, for the purposes of classification, to be treated as if its principal purpose were its sole purpose.

Subject to note 2 to this chapter and note 3 to section XVI, a machine the principal purpose of which is not described in any heading or for which no one purpose is the principal purpose is, unless the context otherwise requires, to be classified in heading 8479.

Counsel claims that because of the variety of media that the MPX-50 is capable of imprinting to including plastic, vinyl, and acrylic, as well as non-ferrous metals, it is not possible to determine the principal purpose of the machine. We disagree. To assist in determining the principal purpose of a machine, we examine a number of factors, and while no one is determinative, they are indicative of principal purpose. These factors include general physical characteristics, environment to sale (ex. advertising; display), expectation of the ultimate purchaser, and recognition in the trade of such use. After examining supplemental information submitted by the Protestant on February 20, 2002 and February 28, 2002, and conducting independent research, Customs has come to the conclusion that the principal purpose of the MPX-50 is to imprint on to metal, with other media being subordinate to this purpose. We reach this conclusion after contacting distributors and representatives in the trade (the Association for Manufacturing Technology – “AMT”, f/k/a the National Machine Tool Builders’ Association – NMTBA), who consider the MPX-50 to be a metal working machine, as well as researching Protestants advertising and other web-sites (http://www.rolanddg.co.uk/NEWDG/PROD/metprint.htm; http://www. gravers.com/iedmpx50.html), which all refer to the MPX-50 as a metal printer. Also, the advertising brochure for the MPX-50 provided by counsel lists in the “Printable material” column only precious metals, base metals and stainless. Although “etc.” follows, this is probative of the principal purpose in working metals. For the forgoing reasons, we determine that the principal purpose of the MPX-50 is to imprint onto metal, and in accordance with Note 7 to Chapter 84, HTSUS, that is treated as the sole purpose. Because the sole purpose of the MPX-50 is to imprint onto metal, proper classification of the merchandise would fall under heading 8463, HTSUS, which provides for machine tools for working metal, without removing material, rather than the 8479, HTSUS, basket provision.

HOLDING:

For the above stated reasons, the MPX-50 photo impact printer is classified under subheading 8463.90.00, which provides for other machine tools for working metal or cements, without removing material: other.

You are instructed to DENY the protest. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you are to mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.

Sixty days from the date of the decision the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.gov, by means of the Freedom of Information Act, and other methods of public distribution.

Sincerely,

John Durant, Director
Commercial Rulings Division

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See also:

• Tariff No.: 8463.90.00 - Machine tools for working metal or cermets, without removing material, nesoi
• Tariff No.: 8471.60.90 - Other input or output units of digital ADP machines, nesoi, not entered with the rest of a system
• Tariff No.: 8479.89.97 - Machines and mechanical appliances having individual functions, not specified or included elsewhere in chapter 84, nesoi