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HQ 966481





August 19, 2003

CLA-2 RR: CR: GC 966481 TPB

CATEGORY: CLASSIFICATION

TARIFF NO.: 8543.89.92

Douglas Turnbull
Hitachi America, Ltd.
Import/Export Office
50 Prospect Avenue
Tarrytown, NY 10591

RE: Hitachi Gas Plasma Monitor; Digital Signage

Dear Mr. Turnbull:

This is in reference to your letter dated April 10, 2003 to the Director, National Commodity Specialist Division, New York requesting a binding ruling as to the classification of Hitachi’s Model CMP4203W gas plasma display (hereinafter referred to as the “monitor”) under the Harmonized Tariff Schedule of the United States (“HTSUS”). That request was referred to this office for reply. In reaching our decision, we took additional information provided by Hitachi on June 10, 2003 into consideration.

FACTS:

The merchandise at issue is a 42-inch gas plasma color monitor designed and targeted for use as a display terminal for commercial advertising. The monitor is certified only to FCC-A class level, which permits commercial use only. The monitor contains firmware that supports only ADP signals and is specifically engineered not to accept either an NTSC or video signal by not incorporating a signal processing IC for video chromatic processing. It cannot perform video and/or NTSC conversion. There is no capability for demodulation of the video signal. There are no optional boards designed for the monitor and since the CMP4203W uses a proprietary port custom designed for Hitachi, a video card manufactured by a third party will not work with this unit.

The monitor has two D sub-15P input connectors for analog (PC) RGB and no standard video input connectors.

ISSUE:

Whether the Hitachi CMP4203W gas plasma monitor is classified as an automatic data processing (“ADP”) unit under heading 8471, HTSUS, or as a flat panel display not specified or included elsewhere under heading 8543, HTSUS?

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.

The HTSUS provisions under consideration are as follows:

Automatic data processing machines and units thereof

Input or output units, whether or not containing storage units in the same housing:

Other:

Display units:

Other:

Other:

Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof:

Other machines and apparatus:

Other:

Other:

Other:

Electrical machines with translation or dictionary functions; flat panel displays other than for articles of heading 8528.

We note initially that in order to be classified under heading 8528, the monitor must be capable of accepting NTSC signals or displaying video signals. You have indicated that the CMP4203W monitor has been specifically engineered not to display these types of signals and that it contains none of the components necessary for the display of these types of signals. These facts preclude classification under heading 8528, HTSUS.

You claim that the display, in its condition as imported, is a unit of an ADP system, and should therefore be classified under heading 8471, HTSUS. To be classified as an ADP output unit within heading 8471, HTSUS, the subject merchandise must meet the terms of Legal Note 5(B) to Chapter 84, HTSUS, which provides that:

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:

(a) 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.

(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.

In your submissions, you have indicated to us that the plasma monitor has two D sub-15P input connectors at the time of its importation which you indicate are for PC input only. This meets the requirements of Note 5(B)(b) to Chapter 84, above.

The preset signal timing chart that you included in your submission (Exhibit D) indicates that the monitor is capable of accepting input signals from a CPU. This meets the terms of Note 5(B)(c) to Chapter 84.

The only question that we are left with is whether the monitor meets the terms of Note 5(B)(a), that it is “of a kind solely or principally used in an automatic data processing system.”

In order to determine the kind of goods to which an article belongs, we must examine all pertinent factors, which may include: (1) the general physical characteristics of the merchandise; (2) the expectation of the ultimate purchasers; (3) the channels of trade in which the merchandise moves; and (4) the environment of the sale (e.g. the manner in which the merchandise is advertised and displayed). See United States v. Carborundum Co., 63 C.C.P.A. 98, 102, 536 F.2d 373, cert denied, 429 U.S. 979, 50 L.Ed. 2d 587. 97 S.Ct. 490 (1976).

The general physical characteristics of the monitor are that of a large display suitable for multiple viewers. You have indicated that the monitor is designed and targeted for a specific type of usage, as the display terminal for commercial advertising use. No information was provided as to the channels of trade for the monitor, nor was any advertisement for the CMP4203W. You did, however, provide a photograph of a gas plasma display being used as a signage display in a clothing store.

Based on the information provided to Customs from Hitachi, there is insufficient evidence to establish that the monitor is of a kind principally or solely used with an ADP system.

Therefore, we do not believe that the monitors meet the terms of note 5(B) and they cannot be classified under heading 8471, HTSUS. Furthermore, note 5(B) is subject to note 5(E). Customs has previously held that LCD monitors used in digital information displays that were not capable of displaying NTSC or video signals performed a function other than data processing and were classified under heading 9013, HTSUS as other liquid crystal devices. See NY E82322, dated June 4, 1999, aff’d by HQ 963152, dated July 30, 2001; HQ 964848, dated May 2, 2001. Since the monitors presently at issue are not liquid crystal devices, classification under that heading is precluded.

The monitors are, however, electrical machines that have an individual function that is not specified elsewhere in chapter 85, and therefore, are classified under subheading 8543.89.92, HTSUS, which provides for flat panel displays other than for articles of heading 8528.

HOLDING:

For the reasons stated above, the Hitachi Model CMP4203W 42-inch gas plasma monitor is classified under subheading 8543.89.92, HTSUS, which provides for display units for: “Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof: Other machines and apparatus: Other: Other: Other: Electrical machines with translation or dictionary functions; flat panel displays other than for articles of heading 8528.”

Sincerely,

Myles B. Harmon, Director

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