CLA-2 OT:RR:CTF:TCM H128416 GA
Mr. Tom Boivin
Roland DGA Corporation
15363 Barranca Parkway
Irvine, CA 92618
RE: Modification of NY N004132; Classification of a wide format inkjet printer and a wide format inkjet printer/cutter from Japan
Dear Mr. Boivin:
This is in reference to New York Ruling Letter (“NY”) N004132, dated December 29, 2006, issued to you concerning the tariff classification of a wide format inkjet printer and a wide format inkjet printer/cutter from Japan, under the Harmonized Tariff Schedule of the United States (HTSUS). In NY N004132, U.S. Customs and Border Protection (CBP) classified a 6 color inkjet printer and contour cutter, Model Number XC-540 in subheading 8477.80.00, HTSUS, which provides for, “Machinery for working rubber or plastics or for the manufacture of products from these materials, not specified or included elsewhere in this chapter; parts thereof: Other machinery.” CBP also classified a wide-format sublimation digital inkjet printer, Model Number FP-740 in subheading 8443.51.50, HTSUS, which provides for, “Printing machinery used for printing by means of printing type, blocks, plates, cylinders and other printing components of heading 8442; ink-jet printing machines, other than those of heading 8471; machines for uses ancillary to printing; parts thereof: Other printing machinery: Ink-jet printing machinery: Other.” We have reviewed NY N004132 and find the portion that relates to the classification of the 6 color inkjet printer and contour cutter, Model XC-540 to be in error. The classification of the wide-format sublimation digital inkjet printer, Model Number FP-740, remains unmodified. For the reasons set forth below, we hereby modify NY N004132.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625(c)(1), as amended by section 623 of Title VI, notice of the proposed action was published in the Customs Bulletin Vol. 49, No. 31, on August 5, 2015. No timely comments were received in response to this notice.
FACTS:
In NY N004132, the subject merchandise was described as follows:
The 6 color inkjet printer and contour cutter, Model Number XC-540, is designed to produced outdoor graphics (banners, signs, vehicle graphics) that are UV and water resistant. Other applications include the production of labels, decals, apparel graphics, floor graphics, and packaging. The unit can print on and cut media such as vinyl, canvas, banner and backlit film up to 54 inches in width. It features a 64 nozzle piezo inkjet print head capable of printing resolutions up to 1440 dpi using solvent based inks. In addition, it has a swivel drag cutting blade for high speed precision contour cutting. In your letter, you indicate that the unit is principally used on plastic media. The unit is intended to be used in conjunction with a separate personal computer (not imported with the Model Number XC-540
ISSUE:
What is the proper classification of the inkjet printer/cutter?
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 headings under considerations are as follows:
8443 Printing machinery used for printing by means of plates, cylinders and other printing components of heading 8442; other printers, copying machines and facsimile machines, whether or not combined; parts and accessories thereof:
8477 Machinery for working rubber or plastics or for the manufacture of products from
these materials, not specified or included elsewhere in this chapter;
parts thereof:
Note 3 to Section XVI, HTSUS, states, in pertinent part, the following:
3. Unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines designed for the purpose of performing two or more complementary or alternative functions are to be classified as if consisting only of that component or as being that machine which performs the principal function.
* * * * *
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System at the international level. While not legally binding, the ENs provide a commentary on the scope of each heading of the HS and are thus useful in ascertaining the proper classification of merchandise. It is CBP’s practice to follow, whenever possible, the terms of the ENs when interpreting the HTSUS. See T.D. 89-90, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The ENs to Section XVI, provide, in relevant part, as follows:
(VI) MULTI-FUNCTION MACHINES
AND COMPOSITE MACHINES
(Section Note 3)
In general, multi-function machines are classified according to the principal function of the machine.
…
Composite machines consisting of two or more machines or appliances of different kinds, fitted together to form a whole, consecutively or simultaneously performing separate functions which are generally complementary and are described in different headings of Section XVI, are also classified according to the principal function of the composite machine.
…
For the purposes of the above provisions, machines of different kinds are taken to be fitted together to form a whole when incorporated one in the other or mounted one on the other, or mounted on a common base or frame or in a common housing.
* * * * *
In your letter dated August 4, 2010, in response to our letter of April 21, 2010, requesting additional information, you addressed the questions concerning the principal function of the subject printer/cutter machine. As an initial matter, we note your admission that information provided to CBP by your former Director of Distribution concerning the principal function of the subject merchandise of ruling NY N004132 (an earlier model inkjet printer with a contour cutter) was incorrect. You indicated that the error could have led CBP to classify the subject printer/cutter in subheading 8477.80.00, HTSUS. You now indicate that the criteria you use to determine the principal function are: (1) the design of the machine, (2) the application to which the end users put the machines, and (3) the cost of the printer/cutters compared to single function machines. You indicate that the principal function of the subject printer/cutter is “printing” and believe it should be classified under heading, 8443, HTSUS. Furthermore, you state that the subject printer/cutter is purposely intended to enable the user to print graphics on a variety of substrate material and once the printing is completed, to permit the cutting of the material into the final form.
Note 3 to Section XVI, HTSUS, directs that unless context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole are to be classified as if consisting only of that component or as being that machine which performs the principal function. As described above, the subject merchandise is used for printing by means of ink jets with the option to cut printed materials. As you indicated, the user may choose to use the printing machine to perform cutting functions. However, the cutting function is not necessary for the operation of the printing machine. The printing machine would not be used solely or primarily for cutting materials without printing.
CBP has found the analysis developed and utilized by the courts in relation to “principal use” (the “Carborundum factors”) to be a useful aid in determining the principal function of such machines. Generally, the courts have provided several factors, which are indicative but not conclusive, to apply when determining whether merchandise falls within a particular class or kind. They include: (1) general physical characteristics; (2) expectation of the ultimate purchaser; (3) channels of trade, environment of sale (accompanying accessories, manner of advertisement and display); (4) use in the same manner as merchandise that defines the class; (5) economic practicality of so using the import; and (6) recognition in the trade of this use. See United States v. Carborundum Co., 63 C.C.P.A. 98, 102, 536 F.2d 373, 377 (1976), cert. denied, 429 U.S. 979 (1976); Lennox Collections v. United States, 20 Ct. Int’l Trade 194, 196 (1996); Kraft, Inc. v. United States, 16 Ct. Int’l Trade 483, 489 (1992); and G. Heileman Brewing Co. v. United States, 14 Ct. Int’l Trade 614, 620 (1990). See also HQ W968223, dated January 12, 2007, and HQ 966270, dated June 3, 2003.
You listed a number of Carborundum factors in your submission including: general physical characteristics, expectation of the ultimate purchaser, channels of trade, environment of sale, the use in the same manner as merchandise which defines the class, economic practicality, and economic recognition in the trade of use of the printer/cutter machine. After examining the product literature and documentation you provided and considering the Carborundum factors, we agree that the principal function of the printer/cutter is for a user to print graphics on a variety of materials. As such, CBP concludes that the subject printer/cutter performs the principal function of printing materials, and pursuant to Note 3 to Section XVI, HTSUS, the subject merchandise shall be classified as if consisting only of the printer. This finding is consistent with prior CBP rulings on similar merchandise. In NY N092737, dated February 4, 2010, various inkjet printers with a built-in contour cutter from Japan were classified as having the principal function of printing machines. See also NY N112997, dated July 16, 2010; NY N018032, dated October 19, 2007; NY N030139, dated June 26, 2008; and NY N044490, dated December 8, 2008.
Therefore, the printing machine is properly classified under heading 8443, HTSUS, as opposed to 8477, HTSUS.
HOLDING:
By application of GRI 1, we find the inkjet printer/cutter (Model XC-540) to be properly classified under heading 8443, HTSUS, specifically, in subheading 8443.32.10, HTSUS, which provides for “Printing machinery used for printing by means of plates, cylinders and other printing components of heading 8442; other printers, copying machines and facsimile machines, whether or not combined; parts and accessories thereof: Printing machinery used for printing by means plates, cylinders and other printing components of heading 8422: Other printers, copying machines and facsimile machines, whether or not combined: Other, capable of connecting to an automatic data processing machine or to a network: Printer units: Ink jet..” The duty rate is “Free.”
Duty rates are provided for your convenience and 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.
EFFECT ON OTHER RULINGS:
NY N004132, dated December 29, 2006, is hereby MODIFIED.
In accordance with 19 U.S.C. 1625(c), this ruling will become effective 60 days after publication in the Customs Bulletin.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division