CLA-2 OT:RR:CTF:TCM HQ H237607 TNA
Port Director, Port of Boston
U.S. Customs and Border Protection
10 Causeway Street, Suite 603
Boston, MA 02222-1059
Attn: Hernani M. Afonso, Senior Import Specialist
RE: Internal Advice Request 13/008; classification of laser marking systems
Dear Port Director:
This is in response to your letter, dated January 4, 2013, forwarding with comments the Request for Internal Advice submitted by Rofin-Baasel Inc. (“Rofin”), on December 28, 2012, concerning the proper classification of laser marking systems under the Harmonized Tariff Schedule of the United States (“HTSUS”).
FACTS:
The subject merchandise consists of laser marking systems that are used for a variety of marking applications. These systems mark such specific items as IC chips, keys for computer keyboards, medical apparatus, and automotive parts. They are available in two different power ranges and mark alphanumeric contents, graphics, grayscale pictures, bar codes, and matrix codes.
The subject laser marking systems are imported as complete systems. They consist of a laser unit with a controller that generates a laser beam, and a galvanometer scan unit. Certain lines of the subject marking systems consist only of these two components. Certain lines of the subject marking systems also contain a power supply and are imported with it.
The subject merchandise’s galvanometer scan unit, which is often abbreviated as “galvo unit” or called a “galvo marking head,” manipulates the laser beam so that it can effectively mark the material. The marking is accomplished by the mechanical action of the galvo unit manipulating the beam that is generated by the laser beam unit. This mechanical action removes material from metal, glass, plastics, and other materials. The marking systems use specialized software to configure the output of the laser to fit the fluctuating operating parameters of the galvo unit.
ISSUE:
Are the subject laser marking systems classified in heading 8456, HTSUS, as “machine tools for working any material by removal of material, by laser or other light or photon beam,” or in heading 9013, HTSUS, as lasers?
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, GRIs 2 through 6 may then be applied in order.
The HTSUS provisions under consideration are as follows:
8456 Machine tools for working any material by removal of material, by laser or other light or photon beam, ultrasonic, electro-discharge, electro-chemical, electron-beam, ionic-beam or plasma arc processes; water-jet cutting machines:
9013 Liquid crystal devices not constituting articles provided for more specifically in other headings; lasers, other than laser diodes; other optical appliances and instruments, not specified or included elsewhere in this chapter; parts and accessories thereof:
Note 1 to Section XVI, HTSUS, of which Chapter 84, HTSUS, is a part, states, in pertinent part, the following:
This section does not cover:…
Articles of chapter 90
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 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 (Aug. 23, 1989).
The EN to heading 8456, HTSUS, provides, in pertinent part, the following:
The machine-tools of this heading are machines used for the shaping or surface-working of any material. They must meet three essential requirements:
(i) They must work by removing material;
(ii) They must carry out operations of the kind performed by machine-
tools equipped with conventional tools;
(iii) They must use one of the following seven processes: laser or
other light or photon beam, ultrasonic, electro-discharge, electro-chemical, electron beam, ionic-beam or plasma arc.
The EN to heading 9013, HTSUS, provides, in pertinent part, the following:
* * *
This heading includes: …
* * *
(2)
the form of separate units, connected to the laser head by cables, Lasers. These produce or amplify electro-magnetic radiation in the wavelength range between 1 nanometre and 1 millimetre (ultra-violet, visible light and infra-red regions of the spectrum), by the process of controlled stimulated emission. When the lasing medium (e.g., crystals, gases, liquids, chemical products) is excited by the light from an electric source or by the reaction from another source of energy, the light beams which are produced inside the lasing medium are repeatedly reflected and amplified in such a way that a coherent light beam (visible or invisible) is emitted from one end which is partly transparent.
In addition to the lasing medium, the energy source (pumping system) and the resonant optical cavity (reflector system), i.e., the basic elements combined in the laser head (possibly with Fabry-Perot interferometers, interference filters and spectroscopes), lasers generally also incorporate certain auxiliary components (e.g., a power supply unit, a cooling system, a control unit and, in the case of the gas laser, a gas supply system or, in the case of liquid lasers, a tank, fitted with a pump for the dye solutions). Some of these auxiliary components may be contained in the same housing as the laser head (compact laser) or may take etc. (laser system). In the latter case the units are classified in this heading provided they are presented together.
Lasers are classified in this heading not only if they are intended to be incorporated in machines or appliances but also if they can be used independently, as compact lasers or laser systems, for various purposes such as research, teaching or laboratory examinations, for example, laser pointers.
However, the heading excludes lasers which have been adapted to perform quite specific functions by adding ancillary equipment consisting of special devices (e.g., work-tables, work-holders, means of feeding and positioning workpieces, means of observing and checking the progress of the operation, etc.) and which, therefore, are identifiable as working machines, medical apparatus, control apparatus, measuring apparatus, etc. Machines and appliances incorporating lasers are also excluded from the heading. Insofar as their classification is not specified in the Nomenclature, they should be classified with the machines or appliances having a similar function. Examples include:
Machine-tools for working any materials by removal of material by laser (e.g., metal, glass, ceramics or plastics) (heading 84.56).
Laser soldering, brazing or welding machines and apparatus, whether or not capable of cutting (heading 85.15).
Instruments for levelling (aligning) pipes by means of a laser beam (heading 90.15).
Laser apparatus specially used for medical purposes (e.g., in ophthalmological operations) (heading 90.18).
Rofin argues that the addition of the galvo head to the laser unit precludes the subject merchandise from being classified as a laser of heading 9013, HTSUS, and instead makes it a machine tool of heading 8456, HTSUS.
In addition to the basic elements of a laser, the lasers of heading 9013, HTSUS, generally incorporate certain auxiliary components such as a power supply unit, a cooling system, or a control unit. These auxiliary components can either be contained in the same housing as the laser head or can be in the form of separate units, connected to the laser head by cables, etc. This latter form in known as a laser system, and the additional units are classified in heading 9013, HTSUS, if they are presented together with the laser. Lasers classified in heading 9013, HTSUS, have a variety of uses and are classified here regardless of whether they are intended to be incorporated into machines or be used independently. See EN 90.13.
In HQ H154040, dated June 9, 2011, CBP classified a “line narrowing module” (LNM) I heading 9013, HTSUS. The LNM was a subassembly consisting of optical prisms, a mirror and a grating, a stepper motor, piezoelectric devices and other electrical and mechanical components, all in a single housing. After importation, the LNM was housed within an excimer laser, which itself was contained within the excimer light source, along with other subassemblies such as a stabilization module, control module, solid state pulsed power module and fluorine traps. In that ruling, we stated that although the excimer laser worked to produce laser light that was eventually used by the stepper/scanner to produce highly sophisticated semiconductors, the excimer laser still acted as a producer of highly tuned and regulated laser light that was later manipulated by additional machinery to produce semiconductors. Furthermore, while the LNM acted to isolate the required wavelength and spectral bandwidth and received instructions from within the light source and stepper/scanner to “tune” the light, CBP found that it was an optical component of the excimer laser and was therefore not excluded from heading 9013, HTSUS.
The instant merchandise is similarly described as a laser of heading 9013, HTSUS. Its laser unit contains a controller that generates a laser beam that produces electro-magnetic radiation in the wavelength range between 1 nanometer and 1 millimeter. As such, it is described by the terms of heading 9013, HTSUS. Furthermore, the fact that the laser is incorporated into a machine is permitted by heading 9013, HTSUS. See EN 90.13. The galvo head simply manipulates the laser beam so that the merchandise can better mark its merchandise. It does not change the character of the beam. As such, the subject merchandise is classified in heading 9013, HTSUS.
Rofin cites NY N087022 in favor of classifying its own merchandise in Chapter 84, HTSUS. In NY N087022, CBP noted that the presence of the merchandise’s beam matching unit and fluorine traps took it out of the scope of heading 9013, HTSUS. Indeed, while the merchandise of NY N087022 included a laser, it was, as a whole, much more than that. The beam matching unit itself consisted of motors, optics, internal housing units, a camera coupled device, neutral density filters, interlocks and an external housing. The laser also consisted of multiple components. Together, these pieces all formed a complete semiconductor manufacturing machine of which a laser was simply one component. By contrast, the subject merchandise is a laser marking system imported without the ancillary equipment necessary to create a machine tool of heading 8456, HTSUS. Therefore, it is excluded in accordance with EN 90.13(2)(1).
Rofin also cites NY N210384, dated April 19, 2012 in support of its arguments. In NY N210384, CBP classified the Gemscriptor Model #PS-300-R (“Gemscriptor”) in subheading 8464.90.01, HTSUS. The Gemscriptor was a cold laser marker that was used to mark, authenticate and identify any type of gem. This diamond marking/ inscription machine is a floor type unit mounted on castors, and was imported with a special table marking holder, a ring holder and a diamond holder. Thus, the Gemscriptor was imported with items that clearly fit the definition of “ancillary equipment,” and which allowed it to perform such a specific function. As such, in its condition as imported, the Gemscriptor was described by the terms of heading 8456, HTSUS. This is contrast to the subject merchandise, which does not contain such ancillary equipment and is better described as a laser of heading 9013, HTSUS.
As was the case in HQ H154040, the subject merchandise acts as a producer of highly tuned and regulated laser light. The laser itself has not been adapted to perform the types of procedures performed by the devices excluded in EN 90.13(2). Furthermore, the laser is what performs the function of the subject merchandise, which is used to mark merchandise with bar codes and other patterns or designs, not build or manufacture new merchandise. Thus, the subject merchandise is not a machine that incorporates a laser as was the merchandise of NY N087022; it is a laser that is imported with subsidiary components. As such, it is described by the terms of heading 9013, HTSUS, which provides for lasers.
Lastly, Rofin argues that the subject merchandise’s galvanometer precludes it from classification in heading 9013, HTSUS. We note that galvanometers are classified in heading 9030, HTSUS. See EN 90.30. Rather than making the subject merchandise a machine of Chapter 84, HTSUS, this classification supports our conclusion that the subject merchandise is essentially optical merchandise of Chapter 90, HTSUS.
Because the subject merchandise is classified in Chapter 90, HTSUS, it is precluded from classification in Section XVI and heading 8456, HTSUS. See Note 1 to Section XVI, HTSUS. As such, we do not reach Rofin’s specific arguments as to whether the subject merchandise meets the definition of a “machine tool” of heading 8456, HTSUS.
HOLDING:
By application of GRI 1, the subject laser marking systems are classified in heading 9013, HTSUS. They are specifically provided for in subheading 9013.20.00, HTSUS, which provides in pertinent part for “Liquid crystal devices not constituting articles provided for more specifically in other headings; lasers, other than laser diodes; other optical appliances and instruments, not specified or included elsewhere in this chapter; parts and accessories thereof: Lasers, other than laser diodes.” The applicable duty rate is 3.1% ad valorem.
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 CBP’s website, located 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