CLA-2 OT:RR:CTF:EMAIN H307923 TPB

Carl W. Mertz
TP-Link USA Corp
145 South State College Blvd., Suite 400
Brea, CA 92821

RE: Revocation of New York (NY) ruling letters N300884 and N304478; Classification of network devices; re-classification of network range extenders

Dear Mr. Mertz:

This letter is in reference to New York (NY) ruling letters N300884, dated October 16, 2018 and N304478, dated June 10, 2019, regarding the tariff classification of certain network range extension devices referred to as “powerline adapters” under the Harmonized Tariff Schedule of the United States (HTSUS).

In those rulings, U.S. Customs and Border Protection (CBP) classi?ed the range extenders in subheading 8517.62.0020, HTSUSA, which provides for “Telephone sets…; other apparatus for the transmission or reception of voice, images or other data…: Other apparatus for transmission or reception…: Machines for the reception, conversion, and transmission or regeneration of voice, images or other data, including switching and routing apparatus: Switching and routing apparatus.”

We have reviewed those rulings and determined that they are incorrect. For the reasons set forth below CBP revokes those ruling letters. Notice of the proposed action was published in the Customs Bulletin, Vol. 54, No. 34, on September 2, 2020. No comments were received in response to that notice.

FACTS:

New York ruling letter N300884 dealt with the classification of network devices referred to as “Network Expansion, Powerline Adapters” (Models: AV600 Powerline Starter Kit - TL-PA4010 KIT, AV2000 2-port Gigabit Passthrough Powerline Starter Kit - TL-PA9020P KIT, AV1000 Gigabit Powerline ac Wi-Fi Kit - TL-WPA7510 KIT).

They each consisted of two units, a base unit and a remote unit. The base unit connects to a user’s router via an Ethernet cable. Then the unit is plugged into a household electrical outlet. The remote unit connects to a user’s end use device and is plugged into a different household electrical outlet. The home’s internal power lines are used to carry the signal and expand the network coverage. Additional adapters can be added to create a greater expanded network. Remote units will connect to end use devices such as televisions, tablets and computers via wired or wireless communication.

New York ruling letter N304478 concerned the classification of a network extension device referred to as the Powerline 1000 – PL1000. The Powerline 1000 – PL1000 is a network expansion/extension device which is also comprised of two separate units: a base unit and a remote unit. The base unit connects to a user’s network router via an Ethernet cable. Then the unit is plugged into a household electrical outlet. The remote unit connects to a user’s end use device and is plugged into a different household electrical outlet.

The function of the PL1000 is to route data through a home’s internal power lines. By routing data through the existing home wiring system the network coverage can be extended or expanded to areas that may be resistant to a wireless connection or where it may be difficult to run new cable. ISSUE:

Whether the network devices at issue should be classified as switching and routing apparatus 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 subheadings under consideration are:

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:

8517.62.0020 Switching and routing apparatus

8517.62.0090 Other

As indicated by you in supplemental submissions, powerline networking is a technology that is used to communicate data through the electrical wiring in the user’s house. When installed, it provides a wired connection to devices that cannot otherwise be reached by Ethernet cable or by Wi-Fi.

To be classified as switching or routing apparatus, the devices must perform switching or routing themselves and not merely rely on an external switching or routing device. A routing device performs the traffic directing function. It is used to forward IP packets in a wide area network (WAN) to a destined client in a local area network (LAN) based on reading the network address information in the data packet, which determines the destination. Then using information in its routing table, or routing policy, it actively directs the packet to the next network on its journey. A routing table file is stored in random access memory (RAM) that contains network information.

A network switch is a multiple-Ethernet-port device that physically connects individual network devices in a computer network, so they can communicate with one another. It is the key component in a business network, connecting multiple network devices such as: PCs, printers, servers and peripherals, and it associates each device’s address with one of the physical ports on the switch.

Unlike a router or a switch, Wi-Fi range extenders have no intelligence and make no decisions as to where the data goes next. They do not contain a software or firmware routing table and cannot read the network address information in the data packet to determine the specific destination of the data packet.

Based on the supplemental information provided and the notion that the powerline adapters do not act as a switch or a router within the realm of networking terminology, CBP is now of the view that these devices are properly classified under subheading 8517.62.0090, HTSUS, which provides for “Telephone sets…; other apparatus for the transmission or reception of voice, images or other data…: Other apparatus for transmission or reception…: Machines for the reception, conversion, and transmission or regeneration of voice, images or other data, including switching and routing apparatus: Other.” The general rate of duty will be Free.

HOLDING:

For the reasons set forth above, the powerline adapters (Models AV600 Powerline Starter Kit - TL-PA4010 KIT, AV2000 2-port Gigabit Passthrough Powerline Starter Kit - TL-PA9020P KIT, AV1000 Gigabit Powerline ac Wi-Fi Kit - TL-WPA7510 KIT, and the Powerline 1000 – PL1000) are classified in subheading 8517.62.0090, HTSUS, which provides for “Machines for the reception, conversion & transmission or regeneration of voice, images or other data, including switching and routing apparatus: Other.” The column one, general rate of duty 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 at www.usitc.gov.

EFFECT ON OTHER RULINGS:

New York ruling letters N300884, dated October 16, 2018 and N304478, dated June 10, 2019, are hereby REVOKED.

In accordance with 19 U.S.C. 1625(c), this ruling will become effective 60 days after publication in the CUSTOMS BULLETIN.


Sincerely,


Gregory Connor

for Craig T. Clark, Director
Commercial and Trade Facilitation Division