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HQ 965608




September 10, 2002

CLA-2 RR:CR:GC 965608 RFA

CATEGORY: CLASSIFICATION

TARIFF NO.: 8479.89.97

Port Director
U.S. Customs Service
11099 S. La Cienega Blvd.
Los Angeles, CA 90045

RE: Protest 2720-02-100079; Chip Placers; Motor Feeders; Power Feeders; Glue Dispensers

Dear Port Director:

The following is our decision regarding Protest 2720-02-100079, which concerns the classification of chip placers under the Harmonized Tariff Schedule of the United States (HTSUS). In preparing this decision, we also considered the information provided by counsel in our telephone conference of August 28, 2002, as well as their additional submission dated September 4, 2002.

FACTS:

The subject merchandise consists of the following products: twin station multi-function SMD Mounters, models NP-251E-XL and QP-351E-mm; motor feeders, models FMB-24E-380 and FMB-16E380; power feeders, model PFU-4E; and glue dispensers.

The twin station multi-function SMD Mounters, models NP-251E-XL and QP-351E-mm, are known as chip placers and chip mounters which are used to assemble numerous types of semiconductor integrated circuits, as well as diodes, transistors and other types of electrical components onto printed circuit boards (PCBs). There are two distinct methods (through hole and surface mount) by which these electrical components may be assembled onto the PCBs. Through hole assembly involves placing the pins of each component into holes
which have been pre-drilled in the PCB. The pins are then bent to clinch the component to the PCB. Solder which was previously applied to the PCB is then melted in order to permanently attach and strengthen the assembly. In surface mount assembly, the electrical components are attached to wire channels on the surface of the PCB by means of an epoxy adhesive.

According to the protestant, the chip placers/mounters basically consist of: (1) a conveyor that loads a PCB into position; (2) removable feeder banks that support reels of the materials to be handled and placed onto the PCB; and a placing system consisting of numerous nozzles that physically place the electrical components at its proper position on the PCB with great accuracy and speed. Once a PCB has been properly positioned and clamped into place, vacuum nozzles extract the components from film wound onto the feeder bank reels and places them on the PCB. A machine may have from 10 to 15 heads, each of which utilizes a particular nozzle to assemble a particular component onto the PCB.

The subject merchandise also includes a high-speed glue dispensing machine, model GL-541E. According to the protestant, a PCB is positioned via a conveyor under multiple glue dispensing heads which contain syringes of various sizes and incorporate needle heating units that maintain optimal temperatures for glue application.

The protestant also entered three types of tape feeders which are used to feed components referred to as surface mount devices to placement machines which assemble them onto a printed circuit board (PCB). These components, consisting of resistors, capacitors, integrated circuits, and similar electrical devices, arrive at the placement machine affixed into a series of pockets in a paper or plastic tape which has been wound onto a reel. For the standard feeder the placement machine operator mounts the reel onto the feeder. The tape containing the components is then threaded through the feeder, and the feeder is snapped into position on the placement machine. Following the instructions of its program, the placement machine will depress a lever on the feeder to mechanically advance the tape one pocket, thus exposing a component for pickup off the tape and placement onto the PCB by the placement machine.

The motor feeder performs the same function as the standard feeder, but incorporates a small stepper motor to advance the tape forward. The power feeder is similar to the motor feeder, and also contains an electric cable which allows the power feeder to communicate with the placement machine regarding the type of component mounted on the feeder, the feeder serial number, and the number of placements which have occurred. This data is passed from the placement machine through a LAN network to a central computer, and is used for quality control and inventory purposes.

The merchandise was entered under subheading 8479.89.97, HTSUS, as other machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter. However, the protestant is requesting that the merchandise be classified under subheading 8428.90.00, HTSUS, as other lifting, handling, loading or unloading machinery. The entries were liquidated on November 16 and 23, 2001, under subheading 8479.89.97, HTSUS. The protest was timely filed on February 14, 2002.

The HTSUS provisions under consideration are as follows:

8428.90.00: Other lifting, handling, loading or unloading machinery (for example, elevators, escalators, conveyors, teleferics): [o]ther machinery. . . .

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

8479.89.97 Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; . . . .: [o]ther machines and mechanical appliances: [o]ther: [o]ther: [o]ther. . . .

Goods classifiable under this provision have a general, column one rate of duty of 2.5 percent ad valorem.

ISSUE:

I. Whether the chip placers are classifiable as other lifting, handling, loading or unloading machinery, or as other machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter, under the HTSUS?

II. Whether the power tape feeders and the motor tape feeders are classifiable as other machines and mechanical appliances or parts of other machines and mechanical appliances having individual functions, under the HTSUS?

III. Whether the glue dispensing machine is classifiable as other lifting, handling, loading or unloading machinery, or as other machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter, 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.

Classification of Chip Placers/Mounters:

Customs has previously determined in NY 884327, dated April 20, 1993, and in NY A88431, dated October 31, 1996, that automatic pick and place systems and electronic component placement machines were classified under heading 8479, HTSUS. See also HQ 962060, dated June 8, 1999. In each of these rulings, the classification under heading 8428, HTSUS, was not mentioned as a possibility.

The protestant states that the subject merchandise are functional units, classifiable in Heading 8428, HTSUS, as other lifting, handling, loading or unloading machinery. Legal Note 4 to Section XVI, HTSUS, states that: "[w]here a machine (including a combination of machines) consists of individual components (whether separate or interconnected by piping, by transmission devices, by electric cables or by other devices) intended to contribute together to a clearly defined function covered by one of the headings in chapter 84 or chapter 85, then the whole falls to be classified in the heading appropriate to that function." The protestant claims that the chip placers/mounters qualify under this heading because the machines insert or “place” materials (the electronic components) onto PC boards. Protestant believes that the chip placers/mounters are industrial robots that perform many of the operations explicitly set forth in the language of heading 8428: the loading of the PCB into the machine’s work area; the lifting of the PCB into place for the insertion operation; the handling of the electronic components by the machine’s “end-of-arm tooling”; and the unloading of the PCB from the work area by the conveyor.

The Harmonized Commodity Description and Coding System Explanatory Notes (EN) constitute the official interpretation of the HTSUS. While not 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, 54 FR 35127, 35128 (August 23, 1989). EN 84.28, page 1461, states, in pertinent part, that heading 8428: “covers a wide range of machinery for the mechanical handling of materials, goods, etc. (lifting, conveying, loading, unloading, etc.). They remain here even if specialized for a particular industry, for agriculture, metallurgy, etc.” The EN 84.28, page 1464, further states that “industrial robots specifically designed for lifting, handling, loading or unloading” are within the scope of this heading.

While we agree that the subject merchandise is a functional unit, we find that its function is not a function described within the terms of heading 8428, HTSUS. The Court of International Trade (CIT) in Mitsubishi International Corporation v. United States, 5 F.Supp.2d 991 (CIT 1998), upheld the Customs Service position that the scope of heading 8428 covers a wide range of machinery for mechanical handling of materials, goods, people and other items. Citing technical sources, Customs has maintained that heading 8428, HTSUS, covers material handling equipment which are devices that transport, position and store raw materials and finished goods for industrial and commercial operations. Id., 5 F.Supp.2d at 1005.

The chip mounter’s function is to manufacture printed circuit assemblies by mounting (sometime referred to as “populating”) electronic components onto printed circuit boards. This position was further confirmed upon reviewing the videotape submitted by counsel on behalf of the protestant that demonstrated the chip placers. In the videotape, the machine is described as a high speed assembly machine. The machine’s function is to populate the PCB with electronic components. It populates the PCBs by using a conveyor to load and unload a PCB under the vacuum nozzle placing heads. These placing heads retrieve the electronic components from one of the several types of feeders made by the manufacturer. We find that the chip mounters/ placers do not meet the terms of heading 8428, as they do not transport, position and store materials. Therefore, classification under heading 8428 is precluded. Based upon our holdings in NY 884327 and in NY A88431, we find that the chip mounters/placers are classified in heading 8479, HTSUS.

During the meeting and in its additional submission, counsel cites to two recent Customs decisions, HQ 965637 and 965638, both dated July 16, 2002, in which Customs dealt with the classification of unfinished functional units. In both of those rulings, the merchandise were described as industrial robots, each consisting of an articulated arm or manipulator on a base but without appropriate end-of-arm tooling. Counsel also submitted pictures of the devices described in the above-referenced rulings to support its position. However, a visual examination of the picture and comparing it to the merchandise demonstrated in the video clearly indicate that the subject chip placers are not industrial robots as they are not an articulator arm or manipulator but machinery that contains vacuum nozzle placing heads to populate printed circuit boards with electronic components. Therefore, we find the rulings cited by counsel not relevant in the present situation.

Classification of Tape Feeders:

The classification of tape feeders has been addressed in the attached companion protest decision, HQ 965394 issued on this date, and is incorporated by reference herein.

Classification of Glue Dispenser Machine:

Protests against decisions of the appropriate Customs officers must be in conformity with applicable statutory and regulatory requirements. Under 19 U.S.C. §1514(c)(1), a protest of a decision under subsection (a) of §1514 must set forth distinctly and specifically each decision as to which protest is made. United States v. E. H. Bailey & Co., 32 CCPA 89, C.A.D. 291 (1945); United States v. Parksmith Corp., 514 F. 2d 1052, 62 CCPA 76 (1975), and related cases. In addition, the Customs Regulations require that a protest set forth the nature of, and justification for the objection set forth distinctly and specifically with respect to each decision. 19 CFR §174.13(a)(6).

The scope of review in a protest filed under 19 U.S.C. §1514 is limited to the administrative record. Customs will consider all relevant allegations that are supported by competent evidence. In acting on a protest, however, Customs lacks the legal authority to assume facts and arguments that are not presented and, therefore, not in the official record.

In this case, protest is properly made against your decision to liquidate the entries in question under subheading 8479.89.97, HTSUS. However, protestant has submitted no arguments or evidence to support a claim the subject glue dispenser machines are classified under a different tariff number. Based on protestant's failure to comply with the requirements of 19 CFR §174.13(a)(6), the protest should be denied as it relates to the classification of the glue dispenser machines. .

HOLDING:

For the foregoing reasons, the chip placers and glue dispensers are classifiable under subheading 8479.89.97, HTSUS, which provides for: “[m]achines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; . . . .: [o]ther machines and mechanical appliances: [o]ther: [o]ther: [o]ther. . . .” Goods classifiable under this provision have a general, column one rate of duty of 2.5 percent ad valorem.

The protest should be DENIED. In accordance with Section 3A(11)(b) of Customs Directive 099 3550065, 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,

Myles B. Harmon, Acting Director
Commercial Rulings Division

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