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HQ 966190

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September 8, 2003

CLA-2 RR:CR:GC 966190 GOB

CATEGORY: CLASSIFICATION

TARIFF NO.: 8507.80.80

Port Director
U.S. Customs Service
2350 North Sam Houston Parkway E
Houston, TX 77032

RE: Protest 5301-02-100434; Battery Packs; 19 U.S.C. 1625(c)

Dear Port Director:

This is our decision regarding Protest 5301-02-100434, filed on behalf of Motorola Inc. (“protestant”) concerning the classification, under the Harmonized Tariff Schedule of the United States (“HTSUS”), of certain battery packs.

FACTS:

The battery packs which are the subject of this protest are substantially similar to the battery packs of HQ 965130 dated March 27, 2002 and HQ 966268 dated May 21, 2003, described below. In 965130, the battery packs were described in pertinent part as follows:

The battery packs, while manufactured to be used solely with specific brands and models of mobile cellular telephone[s], have the following similar components: one or more rechargeable storage batteries, a protective device that can shut off the battery pack when it reaches extreme temperatures (either heat or cold), a printed circuit board assembly (“PCBA”) with functions that vary with the requirements needed and the model of phone, and a plastic housing that provides protection and housing for the components previously mentioned as well as serving as a significant portion of the back/body of the phone.

The file reflects the following. The battery packs were entered on November 1, 2002 under subheading 8529.90.99, HTSUS. The subject entry was liquidated on August 30, 2002 under subheading 8507.80.80, HTSUS. The protest was filed on November 21, 2002.

ISSUES:

1. What is the classification under the HTSUS of the subject battery packs?

2. What is the effect of 19 U.S.C. 1625(c) on the disposition of the protest?

LAW AND ANALYSIS:

We note initially that the protest was timely filed under the statutory and regulatory provisions for protests, 19 U.S.C. 1514(c)(3)(A) and 19 CFR 174.12(e)(1).

Classification under the HTSUS is made in accordance with the General Rules of Interpretation (“GRI’s”). 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 GRI’s may then be applied.

The Harmonized Commodity Description and Coding System Explanatory Notes (“EN’s”) constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the EN’s 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.

The protestant makes two basic claims. It claims that the battery packs are classified in heading 8525, HTSUS. In a supplemental submission, the protestant claims that under 19 U.S.C. 1625(c)(1), the revocation of HQ 965130 (see discussion below) does not impact the entry at issue since the revocation is effective for entries made 60 days after publication of the final revocation notice.

Classification Issue

The HTSUS provisions under consideration are as follows:

8507 Electric storage batteries, including separators therefor, whether or not rectangular (including square); parts thereof:

8507.80 Other:

8507.80.80 Other

8529 Parts suitable for use solely or principally with the apparatus of headings 8525 to 8529:

8529.90 Other:

Other:

8529.90.99 Other

Note 2 to Section XVI, HTSUS, provides in pertinent part as follows:

Subject to note 1 to this section, note 1 to chapter 84 and to note 1 to chapter 85, parts of machines (not being parts of the articles of heading 8484, 8544, 8545, 8546 or 8547) are to be classified according to the following rules:

(a) Parts which are goods included in any of the headings of chapters 84 and 85 (other than headings 8409, 8431, 8448, 8466, 8473, 8485, 8503, 8522, 8529, 8538 and 8548) are in all cases to be classified in their respective headings;

(b) Other parts, if suitable for use solely or principally with a particular kind of machine, or with a number of machines of the same heading (including a machine of heading 8479 or 8543) are to be classified with the machines of that kind or in heading 8409, 8431,8448, 8466, 8473, 8503, 8522, 8529 or 8538 as appropriate ...

(c) All other parts are to be classified in heading 8409, 8431, 8448, 8466, 8473, 8503, 8522, 8529 or 8538 as appropriate, or failing that, in heading 8485 or 8548.

On May 21, 2003, Customs issued HQ 966268 (published in the Customs Bulletin on June 25, 2003) wherein we held that certain battery packs for mobile cellular telephones are classified in subheading 8507.80.80, HTSUS. HQ 966268 revoked HQ 965130 dated March 27, 2002, wherein we classified the battery packs in subheading 8529.90.99, HTSUS. The battery packs in HQ 966268 are substantially similar to the battery packs at issue in this protest.

The analysis of HQ 966268 is applicable here. In HQ 966268, we stated in pertinent part as follows:

In HQ 965130 we referred to a ruling from Revenue Canada (Nokia Products Ltd. v. Deputy Minister of National Revenue, Appeal No. AP-99-082 (July 26, 2000)) in which the Canadian International Trade Tribunal classified cellular telephone battery packs in heading 8529 of the Canadian Tariff. This issue, and the Revenue Canada position, were recently considered by the Harmonized System Committee (“HSC”). In HSC 30 in November 2002 (Annex H/26 to Doc. NCO655E2), the Harmonized System Committee, by a vote of 40 to 0 with two abstentions, decided that battery packs for cellular telephones were classified in heading 8507, as opposed to heading 8529, by application of GRI 1. It is our position that decisions of the HSC should be treated in the same manner as the EN’s, i.e., while neither legally binding nor dispositive, they provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. T.D. 89-80 provides that EN’s and decisions in the Compendium of Classification Opinions “should receive considerable weight.” While this HSC decision may not yet be in the Compendium of Classification Opinions, it is a final decision of the HSC.

In HQ 953767 dated April 19, 1993, Customs classified a cellular telephone battery in subheading 8507.30.00, HTSUS.

In NY D83733 dated November 18, 1998, Customs classified a lithium-ion rechargeable battery for a cellular telephone in subheading 8507.80.80, HTSUS.

While we agree with you that these two rulings do not involve the exact same merchandise as that at issue here, we believe that they are very relevant with respect to the scope and applicability of heading 8507, HTSUS.

Subject to certain exceptions that are not relevant here, goods that are identifiable as parts of machines or apparatus of Chapter 84 or Chapter 85 are classifiable in accordance with Note 2 to Section XVI, HTSUS. See Nidec Corporation v. United States, 861 F. Supp. 136, aff’d 68 F. 3d 1333 (1995). Parts which are goods included in headings of Chapters 84 and 85 are in all cases to be classified in their respective headings. See Note 2(a) to Section XVI, HTSUS. Because we believe that Note 2(a) controls the classification of the subject battery packs, Note 2(b) is not applicable.

With respect to certain of the points raised in your comment, we note the following. Because we are classifying on the basis of Note 2(a) to Section XVI, HTSUS, we do not find that Note 2(b) is in conflict with this ruling, or with the HSC decision described above. Further, we do not believe that there are substantial differences between the goods at issue here and the goods at issue in the HSC decision described above.

We find that the subject goods are essentially electric storage batteries. Therefore, pursuant to Note 2(a) to Section XVI, HTSUS, we determine that the subject battery packs for mobile cellular telephones are provided for in heading 8507, HTSUS, and are classified in subheading 8507.80.80, HTSUS, as: “Electric storage batteries, including separators therefor, whether or not rectangular (including square); parts thereof: Other: Other.”

Our determination is consistent with the Harmonized System Committee decision described above. Our analysis of this matter leads us to conclude that the Harmonized System Committee’s conclusions are correct.

Accordingly, based upon HQ 966268 and the analysis therein, we find that the subject battery packs are provided for in heading 8507, HTSUS, and are classified in subheading 8507.80.80, HTSUS, as: “Electric storage batteries, including separators therefor, whether or not rectangular (including square); parts thereof: Other: Other.”

19 U.S.C. 1625 Issue

19 U.S.C. 1625(c)(1) provides as follows:

(c) Modification and revocation

A proposed interpretive ruling or decision which would-

(1) modify (other than to correct a clerical error) or revoke a prior interpretive ruling or decision which has been in effect for at least 60 days; or

(2) have the effect of modifying the treatment previously accorded by the Customs Service to substantially identical transactions;
shall be published in the Customs Bulletin. The Secretary shall give interested parties an opportunity to submit, during not less than the 30-day period after the date of such publication, comments on the correctness of the proposed ruling or decision. After consideration of any comments received, the Secretary shall publish a final ruling or decision in the Customs Bulletin within 30 days after the closing of the comment period. The final ruling or decision shall become effective 60 days after the date of its publication.

19 CFR 177.12(e)(2) provides in pertinent part as follows:

(e) Effective date and application to transactions – . . .
(2) Rulings or decisions in effect for 60 or more days. If an interpretive ruling or holding or principle covered by a protest review decision that is modified or revoked under this section had been in effect for 60 or more calendar days, the modifying or revoking notice will, provided that liquidation of the entry in question has not become final, apply to merchandise entered, or withdrawn from warehouse for consumption:

(i) Sixty calendar days after the date of publication of the final modifying or revoking notice in the Customs Bulletin under paragraph (b)(2) of this section; . . .

HQ 966268, published in the Customs Bulletin on June 25, 2003, is effective for merchandise entered or withdrawn from warehouse on or after August 25, 2003. (The original final notice incorrectly stated the effective date of August 11, 2003. A correction document published in the Customs Bulletin on July 9, 2003 changed the effective date to August 25, 2003, 60 days after the publication date of June 25, 2003.)

We therefore find that HQ 966268 is not effective with respect to the entry which is the subject of this protest.

HOLDINGS:

1. The subject battery packs are properly classified in subheading 8507.80.80, HTSUS, as: “Electric storage batteries, including separators therefor, whether or not rectangular (including square); parts thereof: Other: Other.” This classification is effective for entries made on or after August 25, 2003.

2. Based upon our determination with respect to the effective date of HQ 966268, the entry at issue herein should be liquidated under subheading 8529.90.99, HTSUS, which was the classification in effect at the time of entry of the merchandise by virtue of our holding in HQ 965130. Accordingly, you are instructed to GRANT 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 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 make the decision available to Customs personnel, and to the public on the Bureau of Customs and Border Protection Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.

Sincerely,

Myles B. Harmon, Director
Commercial Rulings Division

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See also:

• Tariff No.: 8507.80.80 - Other storage batteries nesi, other than of a kind used as the primary source of power for electric vehicles
• Tariff No.: 8529.90.99 - Parts suitable for use solely or principally with the apparatus of headings 8525 to 8528, nesi