CLA-2 OT:RR:CTF:TCM H250531 ALS
TARIFF NOs.: 9031.80.80
Ms. Sarah Cho
LG Electronics U.S.A., Inc.
1000 Sylvan Avenue
Englewood Cliffs, New Jersey 07632
RE: Ruling request regarding the tariff classification of LG Heart Rate Monitor Earphone model # FR74 and LG Fitness Band model # HL84-B; Harmonized Tariff Schedule of the United States (HTSUS) General Rules of Interpretation (GRI) 1 and 3(b); HTSUS subheadings 8518.30.20, 8517.62.50, 8526.92.50, and 9031.80.80
Dear Ms. Cho:
This letter is in reply to your request for a ruling on the proper tariff classification of the LG Heart Rate Monitor Earphone model # FR74 and LG Fitness Band model # HL84-B. Our decision is set forth below.
The first item is a pair of earphones with an accompanying medallion that your company markets as the “LG Heart Rate Monitor Earphone,” model # FR74. The set is designed to be connected to a smart phone via Bluetooth technology and allows the wearer to remotely control some basic telephone and music playback functions through radio frequency, as well as monitor heart rate through the LG fitness application. The application is to be downloaded to the smart phone and works in conjunction with various third-party fitness applications. The pair of earphones with the medallion does not have time keeping, telephone, or music reproducing functions independent of the smart phone. The earphones are connected via a wire to the medallion which in turn transmits and receives data from the connected smart phone. The earphones receive music and voice via the smart phone through the medallion. The earphones also sense heart rate through sensors built into the back of each ear bud. The medallion acts as power on/off switch, a battery check, and a heart rate check, and transmits and receives data from the smart phone. It is designed to be clipped onto the waistline of the user. A remote control that consists of a set of control buttons is built into the wire. This button remotely controls the music played on the smart phone.
The second item is an electronic wrist band which your company markets as the “LG Fitness Band” model # HL84-B. It has a light-emitting diode (LED) screen that displays time, telephone call information, and basic telephone controls, Social Networking Service (SNS) notifications, heart rate information, and music playback controls of the smart phone. The wrist band is connected to the wearer’s smart phone and, independent of the smart phone, to the earphones via Bluetooth. The wrist band does not have telephone, music playback, or time keeping functions independent of the smart phone. The screen is activated either by touch or when the wearer turns his wrist upward to view the information on the screen. The wrist band detects the pulse rate of the wearer and thereby the number of steps that the wearer is taking, effectively functioning as a pedometer. Data for distance, speed, and calorie consumption is accumulated via the built-in accelerometer, as well as up and down movement via the built-in altimeter. The data is transmitted to the application on the smart phone to be calculated for display either on the smart phone or the wrist band.
The two items can work in conjunction with each other, but are packaged separately as imported and intended to be sold separately, despite being displayed together in retail stores. Thus, we will consider them as separate items to be classified as such. It is not necessary to use both items together to utilize the functions of each, with the exception of the wrist band not being able to display heart rate information without the earphones and the smart phone application.
As an initial matter, we are unable to rule on the classification of the LG Heart Rate Monitor Earphone model # FR74. After reviewing your request, it has come to our attention that certain published rulings need to be reconsidered so that we do not have in force rulings that may be inconsistent with our current views on the classification of earphones. We intend to initiate a notice and comment procedure pursuant to 19 U.S.C. §1625(c) to revoke or modify one or more rulings. In this manner we believe we can best meet our obligations regarding the sound administration of the HTSUS and other customs and related laws. See 19 C.F.R. §177.7(a).
We invite you to comment on the relevant proposed modification or revocation, published in an upcoming issue of the Customs Bulletin, available for viewing at www.cbp.gov. The notice and comment procedure typically takes 60 days from the date of publication of the proposed change before a final modified or revoked ruling is published and, other than as provided in 19 C.F.R. §177.12(e), 60 additional days before the change becomes effective.
On publication of the final ruling, if you still wish you may resubmit your request for a prospective ruling to CBP, National Commodity Specialist Division, One Penn Plaza, 10th Floor, New York, NY 10119.
Is the LG Fitness Band model # HL84-B properly classified under HTSUS heading 8517 as “other apparatus for the transmission or reception of voice, images, or other data,” under heading 8518 as a “loudspeaker,” or under heading 9031 as a “measuring or checking instrument... not specified or included elsewhere in [Chapter 90, HTSUS]?”
LAW AND ANALYSIS:
Classification under the HTSUS is determined in accordance with the General Rules of Interpretation (“GRI”) and, in the absence of special language or context which otherwise requires, by the Additional U.S. Rules of Interpretation (“ARI”). GRI 1 provides that the classification of goods shall be “determined according to the terms of the headings 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, GRIs 2 through 6 may be applied in order. GRI 3(a) provides that “the heading which provides the most specific description shall be preferred to headings providing a more general description.” GRI 3(b) provides that “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.” The Explanatory Notes (EN) to the Harmonized Commodity Description and Coding System represent the official interpretation of the tariff at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The HTSUS provisions at issue are as follows:
8517 Telephone sets, including telephones for cellular networks or for other wireless networks; other apparatus for the transmission or reception of voice, images or other data, including apparatus for communication in a wired or wireless network (such as a local or wide area network), other than transmission or reception apparatus of heading 8443, 8525, 8527 or 8528; parts thereof:
8518 Microphones and stands therefor; loudspeakers, whether or not mounted in their enclosures; headphones and earphones, whether or not combined with a microphone, and sets consisting of a microphone and one or more loudspeakers; audio-frequency electric amplifiers; electric sound amplifier sets; parts thereof:
8526 Radar apparatus, radio navigational aid apparatus and radio remote control apparatus
9031 Measuring or checking instruments, appliances and machines, not specified or included elsewhere in this chapter; profile projectors; parts and accessories thereof:
9031.80 Other instruments, appliances and machines:
Note 3 of Section XVI of the HTSUS provides that “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.” Note 3 to Chapter 90 provides that “[t]he provisions of Notes 3 and 4 to Section XVI apply also to this Chapter.” It is well-settled that articles are to be classified in their condition as imported. See, e.g., CBP Ruling HQ H236523 (July 2, 2014).
The LG Fitness Band model # HL84-B performs a wireless transceiver function of heading 8517, an accelerometer and altimeter function of heading 9031, a speaker function of heading 8518, and a radio remote control function of heading 8526. While it will display the time when receiving that data from a cell phone, it does not keep time itself. It is therefore quite similar to the merchandise in CBP Ruling HQ H246726 (June 23, 2014), but without the timekeeping function. Hence, where that ruling considered the merchandise first under GRI 3 as a composite good, and then turned to the remaining Section XVI and Chapter 90 functions, we need only consider the principal function here. In HQ H246726, we found that the principal function could not be discerned and the merchandise was classified under GRI 3(c) in heading 9031.
We find that the functions of the instant merchandise are similarly equal in their importance to the functioning of the device. The wrist band is using the measuring functions throughout a wearer’s workout, but the receiving and transmitting function and radio remote control are likely used on a regular basis. Indeed, the device is purchased for use of all of these functions. Hence, the principal function cannot be determined and GRI 3(c) is used to classify the device in heading 9031, HTSUS.
By application of Note 3 to Section XVI and Chapter 90, the LG Fitness Band model # HL84-B is classified in heading 9031, HTSUS. Specifically, it is classified in subheading 9031.80.80, HTSUS, which provides for “Measuring or checking instruments, appliances and machines, not specified or included elsewhere in this chapter; profile projectors; parts and accessories thereof: Other instruments, appliances and machines: Other.” The 2015 column one, general rate of duty for merchandise of subheading 9031.80.80, HTSUS, is 1.7% ad valorem.
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.
Ieva K. O’Rourke, Chief
Tariff Classification and Marking Branch