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HQ 967239




SEPTEMBER 7, 2004

CLA-2 RR:CR:GC 967239 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: 8472.30.0000

Port Director
U.S. Customs and Border Protection
610 S. Canal Street, Rm. 306
Chicago, IL 60607

RE: Protest 3901-04-100844; Automatic Wrapping System

Dear Port Director:

This is our decision on Protest 3901-04-100844, filed on behalf of Sitma USA, Inc., against your classification, under the Harmonized Tariff Schedule of the United States (HTSUS), of the C950-E PolyPapermatic Millennium III wrapping system.

The system was entered under a provision of heading 8422, HTSUS, as other packing or wrapping machinery (including heat-shrink wrapping machinery). It was reclassified under a provision of heading 8472, HTSUS, as other office machines, and the entry liquidated under this provision on March 26, 2004. This protest was timely filed on June 8, 2004.

FACTS:

Sitma product literature, together with information from a printing industry internet website, describes the goods under protest as the PolyPapermatic Millennium III, model C 950-E. Polywrapping typically involves wrapping a single sheet of plastic film around a book, magazine or catalog. The system at issue, advertised as suitable for a variety of high-volume mail processing applications, consists of a series of modules grouped together, resting on adjustable legs, and operated by a separate, stand-alone process controller. It can insert, onsert, quarterfold, label, do selective assembly, sort by ZIP code, co-mail and stack. The system features autoloaders, a longitudinal sealer and stacker/bundlers, with
wrapping capability of up to 20,000 products per hour. It has maximum bulk capability of up to 2 3/8 inches and can accommodate up to 64 servo-driven feeders feeding up to 64 preprinted supplements, signatures or flyers.

The protestant, through its representative, presents no arguments in support of the entered classification. He does, however, object to the liquidated provision as office machines of heading 8472 because the power, air and vacuum requirements, together with the decibel levels during operation, make the system unsuitable for an “office” atmosphere. The protestant maintains that the environment in which the system is used is akin to the finishing area of a print shop or bindery, which is not a true office setting. Finally, the protestant asserts the system’s feeders and bases do not constitute the type of “base” for fixing or for placing on a table, desk, etc., as required for goods of heading 8472.

The HTSUS provisions under consideration are as follows:

[O]ther packing or wrapping machinery (including heat- shrink wrapping machinery);parts thereof:

Other packing or wrapping machinery (including heat- shrink wrapping machinery):

8422.40.91 Other

Other office machines:

Machines for sorting or folding mail or for inserting mail in envelopes or bands, machines for opening, closing or sealing mail and machines for affixing or canceling postage stamps

ISSUE:

Whether the system is an office machine for purposes of heading 8472.

LAW AND ANALYSIS:

Under General Rule of Interpretation (GRI) 1, Harmonized Tariff Schedule of the United States (HTSUS), goods are to be classified according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6.

The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System at the international level. Though not dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS. Customs believes the ENs should always be consulted. See T.D. 89-80. 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).

Initially, the product literature suggests that Section XVI, Note 4, HTSUS, controls classification of the system. This Note states that machines consisting of individual components, whether separate or interconnected by transmission devices, electric cables or other devices, that are intended to contribute together to a clearly defined function covered by a heading in chapter 84 or chapter 85 are to be classified in the heading appropriate to that function. It remains, therefore, to identify the function the system performs and the heading which describes that function.

In NY G83906, dated November 16, 2000, a printed media distribution system substantially similar to the system at issue here was held to be classified in subheading 8472.30.00, HTSUS. The ruling cited Chapter 84, Note 2 which, in part, states that heading 8422 does not cover office machinery of heading 8472. NY G83906 further cited the Chapter 84, General Explanatory Note (D) to the effect that the order of precedence respecting headings 84.01 to 84.24 found in Chapter 84, Note 2, applies only to machines considered as a whole. The General Explanatory Note continues by instructing that functional units are classifiable in accordance with Section XVI, Note 4, HTSUS. HQ 966264, dated April 15, 2003, affirmed the subheading 8472.30.00 classification expressed in NY G83906, and concluded, in part, that relevant ENs indicate that “office machines” [of heading 8472] are used in a variety of environs for doing “office work” (i.e., work concerning the writing, recording, sorting, filing, etc., of correspondence, documents, forms, records, accounts, etc.). It is noted that the written materials the [machine] processes, i.e., advertisements, catalogs, pamphlets, offers-for-sale, etc., are in the nature of business intercourse or communication between persons and, thus, appear to fall within the common meaning of the term “correspondence” referred to above. Likewise, submitted literature advertises the [machine] as appropriate for “today’s major issues in the mailing industry.” Thus, machinery functioning in substantially the same manner as the wrapping system under protest here was found to do office work for tariff purposes, with 8472 being the heading which describes that function.

As to protestant’s assertion that the system lacks the type of “base” for fixing or for placing on a table, desk, etc., as required for goods of heading 8472 that perform “office work,” the 84.72 ENs state that, in addition to use in offices, machines of the heading may also be used in factories, workshops, railway stations and hotels. Thus, it appears that the character of the work being done, rather than the particular locale, is of primary significance. The 84.72 ENs continue by stating that heading 8472 does not
cover hand tools not having such a base, which are referred to Chapter 82. The Chapter 82 General ENs state that tools otherwise classifiable in Chapter 82 are generally classifiable in Chapter 84 if they are designed for fixing to a bench, a wall, etc., or if, by reason of their weight or size or the degree of force required for their use, they are fitted with base plates, stands, supporting frames, etc., for standing on the floor, bench, etc. Thus, these ENs, read in pari materia with the 84.72 ENs, suggest that machinery which wraps correspondence for mailing or commercial distribution, with adjustable legs for placement on a flat surface such as factory or shop floor, does office work for purposes of subheading 8472.30.00.

HOLDING:

Under the authority of GRI 1 and Section XVI, Note 4, HTSUS, the Sitma PolyPapermatic Millennium III, model C950-E, is provided for in heading 8472. It is classifiable in subheading 8472.30.0000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA). The rate of duty in 2003 was 1.8 percent ad valorem.

The protest should be DENIED. In accordance with the Protest/Petition Processing Handbook (CIS HB 3500-08, June 2002, pp. 18 and 21), 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 CBP personnel, and to the public on the CBP 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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