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HQ 965478




August 30, 2002

CLA-2 RR: CR: GC 965478 TPB

CATEGORY: CLASSIFICATION

TARIFF NO.: 8472.90.80

Mr. Russ Holmgren
Circle International, Inc.
255 Clearview Avenue
Edison, N.J. 08837

RE: Muratec Model MFX-1500; Multi-Function Office Machine; Fax; Note 5(B) to Chapter 84.

Dear Mr. Holmgren:

This is in response to your letter dated December 3, 2001, to the Director, National Commodity Specialist Division, New York, on behalf of Murata Business Systems, Inc., requesting classification of the Muratec Model MFX-1500 (“MFX-1500”) digital office machine under the Harmonized Tariff Schedule of the United States (“HTSUS”). Your request was forwarded to this office for consideration. We regret the delay in responding.

FACTS:

The product at issue is a finished, multi-functional digital (“MFD”) office machine, Model MFX-1500. It scans documents via a platen-based CCD scanner. It stores the images digitally in its standard 2 MB memory and can reproduce numerous copies from a single scan. The MFX-1500 is capable of black and white printing up to 12 pages per minute with its LED print engine at 400 dpi resolution. In fax mode, the MFX-1500 communicates via a 14.4 Kbps modem, which allows it to transmit at 6 seconds per page.

The MFX-1500 has an optional Class-1 standard RS-232 interface available for it, which would allow the copier to also function as a PC/network printer. It is noted, however, that this option is not included when the MFX-1500 is imported.

The HTSUS provisions under consideration are as follows:

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:

8472 Other office machines (for example hectograph or stencil duplicating machines, addressing machines, automatic banknote dispensers, coin-sorting machines, coin-counting or wrapping machines, pencil-sharpening machines, perforating or stapling machines):

Electrical apparatus for line telephony or line telegraphy, including line telephone sets with cordless handsets and telecommunications for carrier-current line systems or for digital line systems

ISSUE:

What is the classification of the Muratec MFX-1500 multi-function digital office machine?

LAW AND ANALYSIS:

Classification under the HTSUS is made in accordance with the General Rules of Interpretation (“GRIs”). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied.

The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80.

As imported, the MFX-1500 is a finished multi-functional digital office machine that has the capability to transmit and receive faxes via a built in modem and to scan documents and convert them to digital signals, which it can store in temporary memory via the flatbed CCD scanner. The MFX-1500 can either transmit stored documents via the fax, or print them via the attached laser print engine. It is the print function, in this case, that is the necessary component to both the fax and scanning capabilities of the multifunction machine.

The MFX-1500 prints via a connected laser print engine. Classification of units of ADP machines is governed by the terms of Legal Note 5 to Chapter 84, HTSUS, which provides in relevant part as follows:

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 part of an complete system if it meets all the following conditions:

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.

Printers, keyboards, X-Y co-ordinate 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 No. 8471.

The information provided for the MFX-1500 indicates that in order for it to function as an ADP printer, optional controllers are required. Therefore, the print engine does not meet the conditions laid out in Note 5(B)(b) to Chapter 84, HTSUS, because it is not connectable to an ADP machine at the time of its importation. It is, however, a complete and fully functioning MFD copier at the time of its importation.

Note 3 to Section XVI, HTSUS, provides that:

Unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines adapted for the purpose of performing two or more complementary or alternative functions are to be classified as if consisting only of that component or as being that machine which performs the principal function.

In this case, the MFX-1500 is a composite machine, which is composed of a fax machine, classifiable under heading 8517, HTSUS, and an office copier, other than that of heading 8443 or 8471, which is classifiable under heading 8472, HTSUS. These two machines are adapted for the purpose of performing two alternative functions (i.e., faxing and copying). To assist in determining the principal function of a machine, we examine a number of factors, and while no one is determinative, together they are indicative of principal function. After conducting independent research (i.e., researching web-sites retailing new and used digital machines; examining advertising brochures; etc.), we believe that it is the copying performed by the digital copier that imparts the principal function of this multi-function digital office machine. Therefore, pursuant to Section XVI, Note 3, HTSUS, the MFX-1500 will be classified as if it consisted solely of a digital copier of heading 8472, HTSUS.

Prior to January 1, 2002, this type of machine was classifiable under heading 8443, HTSUS, as a printing machine. See HQ 957981, dated July 9, 1997, classifying a four-color digital printer under heading 8443; and HQ 959651, also dated July 9, 1997, classifying similar merchandise under heading 8443. However, the terms of that heading have been amended so that certain digital print machines can no longer be classified under that heading.

Because this digital printer does not meet the terms of note 5(B) to chapter 84, nor does it meet the terms of heading 8443, HTSUS, it is classified under heading 8472, specifically under subheading 8472.90.80, which provides for other office machines, other printing machines, other than those of heading 8443 or 8471.

Customs has recently issued rulings on merchandise similar to the Muratec Model MFX-1500. HQ 965527; HQ 965636; HQ 965679; HQ 965980; HQ 965681; HQ 965682; and HQ 965697, all dated August 30, 2002, and to be published in a forthcoming Customs Bulletin, dealt with the classification of MFD copiers that were not connectable to ADP machines at the time of importation. Those ruling all held that the MFD copiers, as imported, were classifiable under heading 8472, HTSUS.

HOLDING:

At GRI 1 the principal function of a multi-function digital office machine that can fax and copy is that of copying. Thus, for the reasons stated above, classification of the Muratec Model MFX-1500 multi-function digital office machine is under subheading 8472.90.80, HTSUS, which provides for other office machinesotherprinting machines other than those of heading 8443 or 8471.

Sincerely,

Myles B. Harmon, Acting Director

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