CLA-2 CO:R:C:M 952779 MBR
Mr. Daniel V. Cusack
Vice President of Manufacturing
80 Pickett District Rd.
New Milford, CT 06776
RE: Revocation of HQ 088520; Telephone Caller ID Unit; Telephonic
Apparatus; NEC America, Inc. v. United States 8531; 8517; HQ
952406
Dear Mr. Cusack:
On September 10, 1991, we issued HQ 088520 to you, regarding
the classification of a telephone "Caller ID" unit, under the
Harmonized Tariff Schedule of the United States (HTSUS). We have
reconsidered that ruling, and our decision follows.
FACTS:
The telephone "Caller ID" unit is a device that displays the
telephone number of a calling party on a liquid crystal display
(LCD). A coded representation of the calling party's telephone
number is sent on the telephone line to the unit, which plugs into
a standard modular wall jack. The caller's number is stored in
chip memory so that the user can review the information at a later
date. The caller ID also records the time and date of call. The
unit does not require that a telephone be attached in order to
operate.
ISSUE:
What is the classification of the telephone "Caller ID," under
the Harmonized Tariff Schedule of the United States (HTSUS)? Is
it classifiable under heading 8531, HTSUS, which provides for
electric sound or visual signalling apparatus, or is it
classifiable under heading 8517, HTSUS, which provides for
electrical apparatus for line telephony?
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LAW AND ANALYSIS:
The General Rules of Interpretation (GRI's) to the HTSUS
govern the classification of goods in the tariff schedule. GRI 1
states, in pertinent part:
...classification shall be determined according to the terms
of the headings and any relative section or chapter notes...
In HQ 088520, dated September 10, 1991, we classified the
telephone "Caller ID" unit under subheading 8531.80.00, HTSUS,
which provides for: "[e]lectric sound or visual signalling
apparatus, other than those of heading 8512 or 8530: [o]ther
apparatus: [i]ndicator panels: [o]ther."
In HQ 088520 we cited the Harmonized Commodity Description and
Coding System Explanatory Notes (ENs) to the HTSUS, page 1382,
which state:
With the exception of signalling apparatus used on cycles or
motor vehicles (heading 85.12) and that for traffic control
on roads, railways, etc. (heading 85.30), this heading covers
all electrical apparatus used for signalling purposes, whether
using sound for the transmission of the signal (bells,
buzzers, hooters, etc.) or using visual indication (lamps,
flaps, illuminated numbers, etc.), and whether operated by
hand (e.g., door bells) or automatically (e.g., burglar
alarms).
(2) Number indicators. The signals appear as illuminated
figures on the face of a small box; in some apparatus of
this kind the calling mechanism is operated by the dial
of the telephone....
Since the "Caller ID" unit visually signals the numbers
associated with telephone numbers and because the unit is activated
by the dial of a telephone, we found the unit to be classifiable
in heading 8531, HTSUS.
However, the court in NEC America, Inc. v. United States, 11
CIT 934 (1987), held that battery operated paging receivers were
classifiable under item 685.24, TSUS, which provides for "other
solid-state (tubeless) radio receivers." Item 685.70, TSUS, is the
predecessor provision to heading 8531, HTSUS. The court in NEC
America, citing the prior NEC America, Inc. v. United States, 8 CIT
184, 596 F. Supp. 466 (1984), stated:
After examining prior case law, the court indicated that
classification under item 685.70, TSUS, was "limited to those
articles whose sole purpose and function is merely
signalling." Hence, the court concluded that the superior
capabilities of the display pagers in issue, with their
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ability to display information in digital form and to retain
it for later recall, clearly "transcend merely signalling."
Therefore, it has been argued that the telephone "Caller ID"
is properly classifiable as telephonic apparatus. After further
analysis, we agree that the functions of the Caller ID, like the
display pagers, transcend mere signalling by displaying information
in digital form and retaining it for later recall. See HQ 952406,
of this same date, for a ruling regarding similar merchandise.
HOLDING:
The telephone "Caller ID" is classifiable in subheading
8517.81.00, HTSUS, which provides for: "[e]lectrical apparatus for
line telephony...: [o]ther apparatus: [t]elephonic." The rate of
duty is 8.5% ad valorem.
EFFECT ON OTHER RULINGS:
This notice to you should be considered a revocation of HQ
088520, dated September 10, 1991, under authority of Section
177.9(d), Customs Regulations [19 CFR 177.9(d)]. It is not to be
applied retroactively to HQ 088520 (19 CFR 177.9(d)(2)) and will
not, therefore, affect past transactions for the importation of the
merchandise under that ruling. However, for the purposes of future
transactions involving merchandise of this type, HQ 088520 will not
be valid precedent.
We recognize that pending transactions may be adversely
affected by this modification, in that current contracts for
importations arriving at a port subsequent to this decision will
be classified pursuant to it. If such a situation arises, you may,
at your discretion, notify this office and apply for relief from
the binding effects of this decision as may be warranted by the
circumstances.
Sincerely,
John Durant, Director
Commercial Rulings Division