CLA-2 RR:CR:GC 962000 JAS
Port Director of Customs
33 New Montgomery Street, Suite 1501
San Francisco, CA 94105
RE: Protest 2809-98-100255; Miniliner, Injection Molding Machine, Compact Disc Replicating Machine
Dear Port Director:
This is our decision on Protest 2809-98-100255, filed against your classification under the Harmonized Tariff Schedule of the United States (HTSUS), of the Miniliner, a compact disc replicating machine, and an injection molding machine, imported on different days. The entries under protest were liquidated on April 10, 1998, and this protest timely filed on May 27, 1998.
Merchandise and legal issues similar to those in issue here were addressed in a Chicago protest review decision issued on June 10, 1999, as HQ 961441. Counsel for the protestant both in that case and in this case summarized factual and legal arguments in support of his proposed classification at a meeting in our office on May 12, 1999. The contents of that meeting were confirmed in a letter, dated May 19, 1999.
FACTS:
The file reflects that the Miniliner disc replicating machine, an interface unit for connecting it to an injection molding machine, and a mold, were imported together in one shipment, and the injection molding machine imported separately.
Initially, a master disc of glass electrolytically coated with nickel, called a stamper, is produced in a separate process not in issue here. The stamper is first placed in the mold and
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the injection molding machine compresses plastic resin under high pressure and velocity into disc-shaped replicas of the stamper. The interface unit is a mechanical transfer arm that moves each disc substrate from the injection molding machine to the Miniliner. As described by counsel for the protestant, the Miniliner then sputter coats the plastic substrate with a thin layer of aluminum, lacquers the substrate, dries or UV cures it, then optically inspects the substrate for defects or abnormalities, and finally, places the finished discs on an “accept” or “reject” spindle.
In liquidation, Customs classified all of the components under a provision in HTSUS 8477, as other injection-molding machines for working rubber or plastics or for the manufacture of articles from these materials. Counsel maintains that the injection molding machine with mold is provided for in HTSUS heading 8477 as an injection-molding machine for use in the manufacture of video laser discs, the Miniliner replicating machine is provided for in a provision of HTSUS heading 8479, as machines and mechanical appliances for the manufacturing of video laser discs, and the interface unit in the appropriate parts provision of the same heading. Counsel argues that the merchandise at issue makes compact discs and some digital video discs. Counsel concedes that machines for making video laser discs are no longer produced or imported but that the machines under protest utilize the same optical laser technology. Counsel concludes they should be classified similarly on the theory that Congress could not have intended to create a tariff provision under which no articles are classified.
The principal HTSUS provisions under consideration are as follows:
8477 Machinery for working rubber or plastics or for the manufacture of products from these materials, not specified or included elsewhere in [chapter 84]; parts thereof:
8477.10 Injection molding machines:
8477.10.40 For use in the manufacture of video laser discs
8477.10.80 Other
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* * * *
8479 Machines and mechanical appliances having individual functions, not specified or included elsewhere in [chapter 84]; parts thereof:
8479.89 Other:
8479.89.85 [m]achines for the manufacturing of video laser discs
8479.89.97 Other
8479.90 Parts:
8479.90.95 Other
ISSUE:
Whether the components in both shipments are classified together, either under heading 8477 or heading 8479.
LAW AND ANALYSIS:
Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in accordance with the General Rules of Interpretation (GRIs). GRI 1 states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6.
Goods that are identifiable parts of machines and apparatus of Chapters 84 and 85 are classifiable in accordance with Section XVI, Note 2, HTSUS. Section XVI, Note 3, HTSUS, states, in part, that unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines adapted 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.
As the injection molding machine and the Miniliner disc replicating machine were imported in separate shipments on different days, they cannot be classified together. These machines must be classified separately, in their condition as
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imported. By way of contrast, in HQ 959655, dated April 3, 1997, we classified the Monoliner, similar in technology to the merchandise under protest, in subheading 8479.89.95, HTSUS. Unlike the instant merchandise, the available information in that case led us to conclude that the Monoliner was a single machine.
Concerning the injection molding machine, compact discs, or CDs, are 5-inch diameter pre-recorded discs in two principal categories, audio CDs and those which contain software or computer data, like CD-ROM, CD-ROM-XA (a combination of audio and video), CD-i (interactive), and Video-CD. The injection molding
machine under protest is designed to mold CD substrates. There is no evidence that CDs are principally used as a video storage medium. There is no basis on which to sustain counsel’s claim that the injection molding machine is for use in the manufacture of video laser discs.
Concerning the classification of the Miniliner disc replicating machine, composite machines of Section XVI, Note 3, HTSUS, 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 in a common housing. Submitted literature depicts the components of the Miniliner disc replicatng machine as being within a common housing. The Miniliner is fitted together to form a whole and, therefore, qualifies as a composite machine. In our opinion, the metalizing component or sputter coater, which applies the aluminum layer to each disc, performs the replicating machine’s principal function. During playback, it is the aluminum that reflects the low-power laser that “reads” the signals encoded on the disc’s surface and allows the disc to play. No 4-digit heading in the HTSUS specifically describes the function the sputter coater performs. However, the sputter coater performs a mechanical function independent of the function of any other machine among the replicating equipment, and is not covered more specifically by any other heading in the HTSUS. As such, it is described by the terms of heading 8479. But, as previously stated, the Miniliner produces CD substrates, not any video based storage media. Therefore, counsel’s proposed classification in subheading 8479.89.85 cannot be sustained.
Interface units of the type in issue here are designed to be mounted onto the injection molding machine. But, since this interface unit was not imported with an injection molding machine, it must be separately classified. Notwithstanding the fact it may be a part of the injection molding machine, the
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interface unit is a good included in HTSUS heading 8428 as lifting, handling, loading or unloading machinery, as required by Section XVI, Note 2(a), HTSUS. Likewise, the mold is a component of the injection molding machine but because it is imported separately, under Note 2(a) it is a good included in HTSUS heading 8480 as injection or compression type molds for rubber or plastics.
HOLDING:
Under the authority of GRI 1, the injection molding machine is provided for in heading 8477. It is classifiable in subheading 8477.10.90, HTSUS. The Miniliner disc replicating machine is provided for in heading 8479. It is classifiable in subheading 8479.89.97, HTSUS. The interface unit is provided for in heading 8428. It is classifiable in 8428.90.80, HTSUS. The mold is provided for in heading 8480. It is classifiable in subheading 8480.71.80, HTSUS.
Since reclassification of the merchandise, as indicated, would result in no net duty reduction, the protest should be DENIED. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you are to mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision. Sixty days from the date of the
decision the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.gov, by means the Freedom of Information Act, and other methods of public distribution.
Sincerely,
John Durant, Director
Commercial Rulings Division