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HQ 967704




August 25, 2005

CLA-2 RR:CTF:TCM 967704 KSH

CATEGORY: CLASSIFICATION

TARIFF NO: 4202.92.9050

Mr. Dennis Forhart
PricewaterhouseCoopers LLP.
1420 Fifth Avenue Suite 1900
Seattle, WA 98101

RE: Reconsideration of NY L80177; portable speaker/CD case from Japan

Dear Mr. Forhart:

This is in response to your letter, received by Customs and Border Protection (CBP) on April 5, 2005, submitted on behalf of your client JVC, requesting reconsideration of New York Ruling Letter (NY) L80177, dated October 22, 2004, in which a portable speaker/CD case was classified in subheading 4202.92.9050, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which essentially provides for cases designed to protect and transport compact disks (CD’s), CD ROM disks, CD players, cassette players and/or cassettes.

FACTS:

The sample you submitted is identified as Item SP-AP300-A-J. It is a clamshell type zippered case that measures 170 millimeters (mm) by 170 mm by 65 mm. The case incorporates a monaural mini-speaker system with an internal amplifier built into one side. The speaker is powered by two AA batteries and can be plugged into various types of devices such as a CD player or MP3 player via an audio plug with gold-plated stereo mini-plug. The case has a spring clip attached to a single loop to facilitate carrying. The interior of the case is specially designed and fitted for a CD player and can hold up to 20 CDs. The exterior surface is composed of polyurethane plastic sheeting.

ISSUE:

Whether the item is properly classified under subheading 4202.92.9050, HTSUSA, as a CD case or under subheading 8518.21.0000, HTSUSA, as a single mounted loudspeaker.

LAW AND ANALYSIS:

Classification under the HTSUSA is made in accordance with the General Rules of Interpretation (GRI). 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 may then be applied. The Explanatory Notes (EN) to the Harmonized Commodity Description and Coding System, which represent the official interpretation of the tariff at the international level, facilitate classification under the HTSUSA by offering guidance in understanding the scope of the headings and GRI.

As two headings potentially govern classification of the subject merchandise, classification cannot be determined on the basis of GRI 1. In pertinent part, GRI 2(b) provides that any reference in a heading to a material or substance shall be taken to include a reference to mixtures or combinations of that material or substance with other materials or substances. However, GRI 2(b) adds that the classification of goods consisting of more than one material or substance shall be according to the principles of rule 3. Accordingly, GRI 3 is utilized when, by application of GRI 2(b), a good consists of materials or components which are prima facie classifiable under two or more headings.

GRI 3(a) states that when goods are prima facie classifiable under two or more headings, classification shall be effected as follows:

The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods.

In this instance, headings 4202 and 8518, HTSUSA, are equally specific in relation to one another. As we cannot classify these goods pursuant to GRI 3(a), we turn to GRI 3(b) which states:

Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.

To determine whether the merchandise constitutes a composite good, we look to Explanatory Note IX to GRI 3(b), which states in pertinent part:

For the purposes of this Rule, composite goods made up of different components shall be taken to mean not only those in which the components are attached to each other to form a practically inseparable whole but also those with separable components, provided these components are adapted one to the other and are mutually complementary and that together they form a whole which would not normally be offered for sale in separate parts.

The portable speaker and the CD case components are attached to each other to form a practically inseparable whole. We find that the portable speaker/CD case is a composite good. Thus, we must determine which component imparts the essential character to the merchandise.

Explanatory Note (EN) VIII to GRI 3(b) states:

The factor which determines essential character will vary as between different kinds of goods. It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.

In situations in which containers of heading 4202, HTSUSA, incorporate electrical devices in their design, CBP has consistently held that the 4202 component imparts the essential character to the article as a whole. See Headquarters Ruling Letters (HQ) 087057, dated December 21, 1989; HQ 089901, dated April 2, 1992; HQ 955261, dated April 14, 1994; HQ 961240, dated February 12, 1990; New York Ruling Letters (NY) 841628, dated June 6, 1989; NY 853347, dated July 3, 1990; and NY L83346, dated March 17, 2005. In each of these cases, the article involved a fully functional carry case or bag of heading 4202, HTSUSA, and a complete electronic device. Similarly, in this instance, we find that it is the case which imparts the essential character to the article. A consumer's motivating impetus to purchase this article would primarily be the need or desire for a container which can store, protect and transport a CD player and CDs. The fact that this article can also amplify music directed into the amplifier and speakers from an external output source may make the case distinctive and more attractive to some. However it is unlikely that a consumer would purchase this article primarily for use as an amplifier. The essential character of the subject speaker/CD case is imparted by the 4202 component and the composite good is classified under subheading 4202.92.9050, HTSUSA.

HOLDING:

NY L80177, dated October 22, 2004, is hereby affirmed.

The portable speaker/CD case is classified in subheading 4202.92.9050, HTSUSA, which provides for “Trunks, suitcases, vanity cases, attaché cases, briefcases, school satchels, spectacle cases, binocular cases, camera cases, musical instrument cases, gun cases, holsters and similar containers; traveling bags, insulated food or beverage bags, toiletry bags, knapsacks and backpacks, handbags, shopping bags, wallets, purses, map cases, cigarette cases, tobacco pouches, tool bags, sports bags, bottle cases, jewelry boxes, powder cases, cutlery cases and similar containers, of leather or of composition leather, of sheeting of plastics, of textile materials, of vulcanized fiber or of paperboard, or wholly or mainly covered with such materials or with paper: Other: With outer surface of sheeting of plastic or of textile materials: Other: Other, Other: Cases designed to protect and transport compact disks (CD’s), CD ROM disks, CD players, cassette players and/or cassettes.” The general column one rate of duty is 17.6% ad valorem.

Sincerely,

Myles B. Harmon, Director

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