CLA-2 OT:RR:CTF:TCM H026661 RM
Mr. Robert Doyle
Affiliated Customs Brokers Limited
Customs & Trade Services Group
411 rue des Recollets
Montreal, Quebec
Canada, H2Y 1W3
RE: Tariff Classification of the CANtrak 2600 and 2610 LCD Graphical Displays
Dear Mr. Doyle:
This is in response to your letter dated April 16, 2008, to U.S. Customs and Border Protection (CBP), in which you requested a binding ruling on behalf of Kongsberg Inc., pertaining to classification of the CANtrak LCD graphical displays under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
You propose to import two versions of LCD graphical displays which are interfaces for automotive, industrial and marine equipment applications (e.g., engine monitoring and diagnostic displays). Designated as CANtrak 2600 and 2610, the units consist of 4.3 x 4.3 inch, 160 x 128 pixel LCD displays with five soft keys used to set and control the various applications. The displays must be configured for their intended purpose via the application of software. For example, if configured to monitor engine gauges, the units display the revolutions per minute, temperature, speed and fuel tank level. They can also be programmed to alarm the user of predetermined events (e.g., “service required”).
ISSUE:
What is the proper tariff classification of the CANtrak graphical LCD displays under the 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 2 through 6 may then be applied in order.
The HTSUS provisions under consideration are as follows:
8531 Electric sound or visual signaling apparatus (for example, bells, sirens, indicator panels, burglar or fire alarms), other than those of heading 8512 or 8530 …:
8531.20.00 Indicator panels incorporating liquid crystal devices (LCD’s) or light emitting diodes (LED’s) …
8531.20.0020 Incorporating LCD’s …
* * *
9013 Liquid crystal devices not constituting articles provided for more specifically in other headings; …:
Other devices, appliances and instruments:
Flat panel displays other than for articles of heading
8528, except subheadings 8528.51 or 8528.61 …
* * *
You argue that the merchandise is classified in subheading 8531.20.0020, HTSUS, as electrical visual signaling indicator panels incorporating liquid crystal devices (LCD’s). Heading 8531, HTSUS, is a “use provision,” subject to Additional U.S. Rule of Interpretation 1(a) which states that: “[a] tariff classification controlled by use (other than actual use) is to be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong, and the controlling use is the principal use.” See Headquarters Ruling (HQ) 951288, dated July 7, 1992. Therefore, to be classified in heading 8531, HTSUS, the apparatus must be designed for “signaling.”
When interpreting and implementing the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, while neither legally binding nor dispositive, provide a guiding commentary on the scope of each heading and are generally indicative of the proper interpretation of the HTSUS. CBP believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The ENs to heading 8531, HTSUS, are fairly descriptive and restrictive as to the type of “signaling” indicator panels and the like must perform in order to be classified in that provision. EN 85.31 provides, in part: “[t]hese are used (e.g., in offices, hotels and factories) for calling personnel, indicating where a certain person or service is required, indicating whether a room is free or not. They include:
Room indicators. These are large panels with numbers corresponding to a number of rooms.
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 a telephone. Also clock type indicators in which the numbers are indicated by a hand moving round a dial.
Office indicators, for example, those used to indicate whether the occupant of a particular office is free or not.
Lift indicators. These indicate, on an illuminated board, where the lift is and whether it is going up or down. etc.
It is well-established that only those LCD’s which are limited by design and/or principal use to that of “signaling” are classifiable in heading 8531, HTSUS. See HQ H003880, dated March 27, 2007; HQ 954788, dated December 1, 1993; HQ 953115, dated May 10, 1993; HQ 952502; HQ 951868, dated October 31, 1992; HQ 952360, dated October 15, 1992; and HQ 951288, dated July 7, 1992. Further, in Optrex America, Inc. v. United States 427 F. Supp. 2d 1177 (Ct. Int’l. Trade 2006), affd, 475 F.3d 1367 (Fed. Cir. 2007), the Court explained that to be classified as an indicator panel incorporating LCD’s under heading 8531, HTSUS, “the article must belong to the class or kind of merchandise that is principally used to display limited information that is easily understood by the person viewing it.”
The LCD graphical displays at issue present limited indication information that is easily understood by the user, e.g., revolutions per minute, fuel tank level, speed, etc. These functions are akin to those performed by the indicator panels enumerated in the ENs to heading 8531, HTSUS. Accordingly, we find that the displays are dedicated by their use and limited by their operational capabilities to signaling functions, and are thereby classified in heading 8531, HTSUS. As such, the merchandise is precluded from heading 9013, HTSUS, which is expressly limited to LCD’s "not constituting articles provided for more specifically in other headings."
HOLDING:
By application of GRI 1, the CANtrak graphical LCD displays are classified in heading 8531, specifically subheading 8531.20.0020, HTSUS, which provides for: “[e]lectric sound or visual signaling apparatus (for example, bells, sirens, indicator panels, burglar or fire alarms), other than those of heading 8512 or 8530: [i]ndicator panels incorporating liquid crystal devices (LCD’s) or light emitting diodes (LED’s): [i]ncorporating LCD’s.” The 2008 column one, general rate of duty is: “[f]ree.”
Duty rates are provided for convenience only and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at www.usitc.gov/tata/hts/.
Sincerely,
Gail A. Hamill, Chief
Tariff Classification and Marking Branch