CLA-2 OT:RR:CTF:TCM H275685 ALS
Ms. Elva Muneton
Director
Electronics Center of Excellence and Expertise
U.S. Customs and Border Protection
Long Beach, California
RE: Internal Advice; Tariff Classification of the popSLATE iPhone mobile telephone case/image display device
Dear Ms. Muneton:
This letter is in reply to your request for internal advice, dated January 22, 2016, that you submitted on behalf of Robert M. Kennard, licensed customs broker representing popSLATE Media, Inc. (hereinafter referred to as “PSM”). The internal advice request concerns the “the HTSUS [Harmonized Tariff Schedule of the United States] classification of the popSLATE” iPhone mobile telephone case/image display device. Our decision is set forth below.
FACTS:
The popSLATE iPhone mobile telephone protective case/display is a protective case, with an image display screen built in, for the iPhone 6 mobile smart telephone. It has a 4-inch viewing screen on the back of the case that displays “black and white photographs and illustrations”, as well as “calendars, mobile boarding passes, digital movie tickets, maps, etc.,” that are transmitted from the iPhone to the popSLATE screen via Bluetooth (a wireless transmission protocol) “without depleting the iPhone’s battery.” The popSLATE has its own battery (240mAh) independent of the iPhone and displays images and information utilizing its own battery without impacting the iPhone’s battery. The popSLATE display can be activated without activating the iPhone or its battery.
The popSLATE’s external components are made of Acrylonitrile Butadiene (ABS) or ABS plus polycarbonate (PC), and they are intended to be a protective cover for both the popSLATE and the phone. The popSLATE display is a proprietary “E Ink” “type of electronic paper”. The popSLATE is packaged for retail sale with a USB/micro USB charging cable and a “Quick Start Guide”. The popSLATE works in conjunction with the “Pop App,” an iPhone application available for download from Apple, Inc.’s App Store. The Pop App allows the user to “select which image to display on the E Ink screen.”
ISSUE:
Is the popSLATE iPhone mobile telephone case/image display screen, as described above, properly classified under HTSUS heading 8517, which provides for “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”, or under HTSUS heading 8543, which provides for “Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof”?
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 2(b) provides the following:
2. (b) 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. Any reference to goods of a given material or substance shall be taken to include a reference to goods consisting wholly or partly of such material or substance. The classification of goods consisting of more than one material or substance shall be according to the principles of rule 3.
GRI 3(b) provides the following:
3. When, by application of rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows:
(b) 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. The following headings and subheadings of the HTSUS are under consideration in this case:
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:
Other apparatus for 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):
8517.62.00 Machines for the reception, conversion and transmission or regeneration of voice, images or other data, including switching and routing apparatus:…
* * *
8543 Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof:
8543.70 Other machines and apparatus:
Other:
Other:
8543.70.99 Other…..
* * * * * * *
PSM contends that heading 8517 is the appropriate HTSUS provision for the popSLATE device because “the popSLATE meets the definition of an electrical apparatus specified in the EN for classification under Heading 8517 as it transmits data from the iPhone to the popSLATE via Bluetooth.” PSM further argues that “CBP has consistently ruled that imported items containing Bluetooth capability and used for transmission of data from two Bluetooth enable [sic] devices are classified under HTSUS subheading 8517.62.0050. See [CBP Ruling NY] N120188, dated August 27, 2010 (wearable sunglasses); [CBP Ruling NY] N237489, dated February 6, 2013 (hi-Call Bluetooth Talking Gloves); [CBP Ruling NY] N234018, dated November 6, 2012 (Mobile Bluetooth Station); [CBP Ruling NY] N233055, dated September 24, 2012 (Bluetooth stereo headset); and [CBP Ruling NY] N233202, dated October 2, 2012 (Bluetooth wireless speaker).”
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). 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 the constituent material in relation to the use of the goods."
Upon review and examination of the provided sample popSLATE case, we find that it is a composite article that consists of a Bluetooth receiver, an image display screen, and a protective case for a mobile telephone. The various functions of the popSLATE case suggest that functionality should determine the essential character of the case. The most prominent feature of these three functions is the image display screen, as it is the function which distinguishes the popSLATE case from most other protective cases for mobile phones. It is also the feature that is marketed most aggressively as the purpose of the popSLATE case. The Bluetooth receiver of the article at issue serves to support the functionality of the screen, as it transmits the digital image to the screen for display. As such, the Bluetooth receiver is an ancillary feature of the popSLATE case, not the primary feature. The protective case does serve a practical function of offering some protection to the mobile phone against damage or possibly destruction from mishandling. However, given the construction of the plastic shell and the fact that it doesn’t fully enclose the mobile phone, we conclude that the plastic shell merely confers an additional benefit of the popSLATE case that is not essential to the use of the case. Thus, we find that the image display screen is the function that provides the popSLATE case with its essential character.
Heading 8543, HTSUS, provides for articles that are electronic machines or apparatus with individual functions, not specified elsewhere in Chapter 85 of the HTSUS. The image display screen is an apparatus that wirelessly receives images for display. The image display screen does not transmit data to other devices and none of the popSLATE’s functions provide any functionality beyond supporting its image displaying function. This is contrast to another device that contains a wireless transmitter that we recently ruled upon. In CBP Ruling HQ H260060 (July 14, 2015), we found that a wearable electronic device in the form of a wrist-watch that incorporated, among other things, a radio transceiver that included Bluetooth technology, is defined by its radio transceiver. We concluded in HQ H260060 the following:
...although each of the Apple Watch’s component articles (e.g., the microphone, speaker, AMOLED display, heart rate monitor, accelerometer, and gyro sensor) enable important functionality in the operation of the Apple Watch, it is the radio transceiver that is indispensable to the core, essential condition of the device, because the radio transceiver facilitates the display, manipulation, and storage of data between the Apple Watch and a paired iPhone.
The radio transceiver enables the Apple Watch to communicate wirelessly with a paired, Internet-connected Apple iPhone to display, manipulate, and store data via the execution of watchOS apps and their associated WatchKit extensions. Upon consideration of the role of each of the Apple Watch’s component articles in relation to the use of the Apple Watch, CBP therefore finds that the essential character of the Apple Watch is imparted by the radio transceiver.
By contrast, the popSLATE does not communicate with other devices to execute other functions.
The popSLATE’s displaying of images is much like that of a television. While a television also has distinct functions that include the reception of broadcast signals, cable transmissions, or satellite transmissions for display, it cannot be said that the reception apparatus of the television imparts the essential character of the television. Rather, it is the displaying of the images the television receives that imparts the essential character of that device. So it is with the popSLATE as well. Thus, the popSLATE is not characteristic of devices that we have classified under heading 8517, such as the Apple Watch in HQ H260060 and the devices at issue in the various CBP Rulings to which PSM cites, that facilitate the communication amongst other devices in a wired or wireless network as their core functions. With the instant popSLATE, the Bluetooth functionality merely serves as a connection between a smart phone and the display. Therefore, as the video display function imparts the essential character of the popSLATE, it is properly classified under heading 8543, HTSUS, as “Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof.” More specifically, the popSLATE iPhone mobile telephone case/image display is properly classified under subheading 8543.70.99 as “Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof: Other machines and apparatus: Other: Other: Other...”
HOLDING:
By virtue of GRI 3(b), the subject popSLATE iPhone mobile telephone case/image display device is properly classified under heading 8543, HTSUS, as “Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof.” More specifically, the popSLATE iPhone mobile telephone case/image display device is properly classified under subheading 8543.70.99 as “Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof: Other machines and apparatus: Other: Other: Other...” The general column one rate of duty, for merchandise classified in this subheading is 2.6%.
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.
You are to mail this decision to the internal advice requester no later than 60 days from the date of the decision. At that time, the Office of International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division