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HQ 966991




May 19, 2004

CLA-2 RR: CR: GC 966991 TPB

CATEGORY: CLASSIFICATION

TARIFF NO.: 8471.60.4580

Mr. Richard J. Little
Assistant General Counsel
Mitsubishi Electric & Electronics USA, Inc. 5665 Plaza Drive
P.O. Box 6007
Cyprus, CA 90630-0007

RE: Digital Display Cubes

Dear Mr. Little:

This is in reference to your letter dated January 20, 2004 to the Director, National Commodity Specialist Division, New York, on behalf of Mitsubishi Digital Electronics America, Inc. (“MDEA”), resubmitting a request for a binding ruling on the classification of certain large screen display cubes under the Harmonized Tariff Schedule of the United States Annotated (“HTSUSA”). That request was referred to this office for reply.

FACTS:

The merchandise at issue are two types of large screen Mitsubishi-brand display cubes which utilize Digital Light Processing (“DLP”) technology: model VS-50FD10U (“VS-50”), which contains a 50-inch diagonal viewing screen and model VS-67FD10U (“VS-67”), which contains a 67-inch diagonal viewing screen. Literature provided indicates that these display cubes are used in network operation centers or command and control centers.

Specification data for the two models at issue indicate that they can accept an analog or digital RGB signal; their resolution is 1024x768 pixels (standard XGA format); their signal input terminals for analog are 5-BNC and for digital are MDR-20 pins; their control signal input include RS-232C interfaces. Their horizontal scanning frequencies are 46 kHz-49 kHz and their vertical scanning frequencies are 49 Hz-61 Hz; they have a pixel clock rate of 60-67 MHz; the contrast ration of the VS-50 is 300:1 and for the VS-67 it is 250:1; the brightness of the VS-50 is 50 cd/m2 and for the VS-67 it is 180 cd/m2. ISSUE:

Are Mitsubishi Digital Display Cubes models VS-50 and VS-67 classified under heading 8471 as units of automatic data processing machines or under heading 8543 as electrical machines and apparatus having individual functions, not specified or included elsewhere?

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:

Other:

Other:

8471.60.4580 Other.

8543 Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter.

Other machines and apparatus:

8543.89 Other:

Other:

Other:

Other:

8543.89.9695 Other.

We note for the record that heading 8528, HTSUSA is not one of the headings under consideration for this merchandise, even though Customs has previously classified similar merchandise under that heading. See NY E82327, dated June 1, 1999; HQ 963152, dated July 30, 2001. In order to be classified under heading 8528 as a video monitor, the monitor must be capable of accepting NTSC/PAL signals or displaying video signals (ex. composite video, component video, Y/C S-video, or high-definition component video). You have indicated that the VS-50 and VS-67 at the time of their importation are incapable of displaying these types of signals and can only display computer images in an analog or digital RGB XGA format. The VS-50 and VS-67 are incapable of showing these types of signals because they are imported without an input board, model VC-B10KA (which may be purchased separately and installed), and omit the electronic components and software necessary for displaying video signals. The inability to display or process video signals distinguishes the instant merchandise from the monitors classified in NY E82327 and HQ 963152 as does evidence of its “use” as further described below. These facts would therefore preclude classification under heading 8528, HTSUSA, as the devices do not meet the terms of the heading. However, we take this opportunity to affirm the holdings in NY E82327 and HQ 963152 and caution against the use of the present ruling to classify displays that are capable of accepting video signals in such a way as is incongruous with the above mentioned rulings.

You indicate that the devices before us are units of ADP systems, and should therefore be classified under heading 8471, HTSUSA. To be classified as an ADP output unit within heading 8471, HTSUSA, the subject merchandise must meet the terms of Legal Note 5(B) to Chapter 84, HTSUS, which provides that:

(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 submission, you indicated that the VS-50 and VS-67 displays contain a number of ADP connectors: the control signal input is a RS-232 interface; the analog signal input is a 5 BNC connector; and, the digital input is an MDR-20 pin connector. These connectors meet the requirements of Note 5(B)(b) to Chapter 84.

The specifications of the monitors included as exhibits in your submission indicate that the monitors are capable of accepting input signals from CPUs in analog or digital XGA format. This meets the terms of Note 5(B)(c) to Chapter 84.

The only question that we are left with is whether the monitors meet the terms of Note 5(B)(a), that they are “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; (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, 377 (Fed. Cir 1976), cert denied, 429 U.S. 979, 50 L.Ed. 2d 587. 97 S.Ct. 490 (1976); Lenox Collections v. United States, 19 CIT 345, 347 (1995).

In general terms, these displays are large scale monitors which are capable of exhibiting a variety of information. You indicate that the Mitsubishi Display Cubes are intended for use in control or command centers and industrial applications. The displays are sold exclusively to authorized independent system integrators. You have also submitted advertisements from MDEA that show the VS-50 and VS-67 display cubes used in command and control center applications. The provided literature also focuses on industrial use. Based on the information provided to Customs, there is sufficient evidence to show that the VS-50 and VS-67 DLP display cubes are of a kind solely or principally used with an ADP system. Therefore, this merchandise meets the terms of Note 5(B) and may be classified under heading 8471, HTSUSA. Furthermore, Note 5(B) is subject to Note 5(E). Customs has previously held that certain 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. In this case, however, we feel that you have supplied adequate information in the form of product specifications, capabilities and use to show that Note 5(E) to Chapter 84 is not applicable to the instant merchandise.

HOLDING:

For the reasons stated above, the Mitsubishi DLP display cubes models VS-50 and VS-67 are classified under heading 8471, specifically, subheading 8471.60.4580, HTSUSA, 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: Other: Other.” The column one, general rate of duty is free. Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the internet at www.usitc.gov.

Sincerely,

Myles B. Harmon, Director

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