CLA-2 OT:RR:CTF:TCM H257208 LWF
Port Director, Los Angeles International Airport—Cargo Operations
11099 South La Cienega Blvd.
Los Angeles, CA 90045
Attn: Entry Processing and Protests
Re: Application for Further Review (AFR) of Protest No. 2720-14-100220; tariff classification of certain digital video cameras
Dear Port Director:
This is in response to the Application for Further Review (AFR) of Protest No. 2720-14-100200 filed on February 24, 2014, on behalf of JVC Americas Corp. (“JVC”), contesting U.S. Customs and Border Protection’s (CBP) tariff classification and liquidation of certain digital video cameras under the Harmonized Tariff Schedule of the United States (HTSUS). For the reasons set forth below, the office instructs the Port to deny the protest.
FACTS:
The Protest/AFR concerns the tariff classification of a shipment of JVC digital video cameras entered at the Service Port of Los Angeles International Airport—Cargo Operations on October 23, 2012. The digital video camera is identified as the JVC “HD/SD Memory Card Camcorder,” Model No. GY-HM150U (pictured below at Fig. 1). It is a compact, handheld digital camcorder that is capable of recording both high definition (HD) and standard definition (SD) on removable memory cards that are inserted into the camera. The camera can be used to record video in a number of digital formats; however, the camera is not capable of capturing “still” digital images and cannot be used for digital “still” photography.
Figure 1: JVC “HD/SD Memory Card Camcorder,” Model No. GY-HM150U
JVC entered the cameras on October 23, 2012 under subheading 8525.80.50, HTSUS, in accordance with CBP Headquarters Ruling Letter (“HQ”) H046643, issued to JVC on May 10, 2010, in which CBP classified several models of multifunction digital cameras capable of capturing both video and digital “still” images under subheading 8525.80.50, HTSUS. Subheading 8525.80.50, HTSUS (2012), provides for “Transmission apparatus for radio-broadcasting or television, whether or not incorporating reception apparatus or sound recording or reproducing apparatus; television cameras, digital cameras and video camera recorders: Television cameras, digital cameras and video camera recorders: Other.” CBP liquidated the cameras under subheading 8525.80.50, HTSUS, on September 6, 2013.
JVC timely filed this Protest/AFR on February 24, 2014 to protest the tariff classification of the cameras. Specifically, JVC asserts that the cameras are properly classified as “digital still image video cameras” under subheading 8525.80.40, HTSUS (2012), in view of the U.S. Court of International Trade’s decision in Sony Electronics, Inc., v. United States, 35 Int’l Trade Rep. (BNA) 2395 (Ct. Int’l Trade Dec. 23, 2013).
ISSUE:
Whether the JVC digital video camera is classified under subheading 8525.80.40, HTSUS, as “digital still image video cameras,” or under subheading 8525.80.50, HTSUS, as “other” television cameras, digital cameras and video camera recorders.
LAW AND ANALYSIS:
As an initial matter, CBP notes that the tariff classification of JVC’s digital video camera is protestable under 19 U.S.C. § 1514(a)(2) as a decision on classification. The protest was timely filed, within 180 days of the liquidation date of the entry, pursuant to the Miscellaneous Trade and Technical Corrections Act of 2004, Pub. L. 108-429, § 2103(2)(B)(ii), (iii) (codified as amended at 19 U.S.C. § 1514(c)(3) (2006)).
Additionally, Further Review of Protest No. 2720-14-100220 was properly accorded to JVC, pursuant to 19 C.F.R. § 174.24(c), because the decision against with the protest was filed involves matters previously ruled upon by the Commissioner of CBP or his designee of by the Customs courts, but facts are alleged or legal arguments presented which were not considered at the time of the original ruling. Specifically, JVC asserts that the proper classification of the subject digital video camera is controlled by the U.S. Court of International Trade’s decision in Sony Electronics, Inc., v. United States, 35 Int’l Trade Rep. (BNA) 2395 (Ct. Int’l Trade Dec. 23, 2013).
Merchandise imported into the United States is classified under the HTSUS. Tariff classification is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context which requires otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provision of law for all purposes. GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in their appropriate order.
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and are generally indicative of the proper interpretation of the heading. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
With respect to the tariff classification of the JVC digital video camera, the relevant 2012 HTSUS provisions state, as follows:
8525 Transmission apparatus for radio-broadcasting or television, whether or not incorporating reception apparatus or sound recording or reproducing apparatus; television cameras, digital cameras and video camera recorders:
8525.80 Television cameras, digital cameras and video camera recorders:
8525.80.40 Digital still image video cameras
8525.80.50 Other
* * * * *
This Protest/AFR concerns the tariff classification of a JVC digital video camera among the 8-digit subheadings provided under subheading 8525.80, HTSUS. Subheading 8525.50, HTSUS, is an eo nomine provision that includes all forms of the named articles, “Television cameras, digital cameras and video camera recorders.” See Sony Electronics, Inc., v. United States, 35 Int’l Trade Rep. (BNA) 2395 (Ct. Int’l Trade Dec. 23, 2013). The ENs to subheading 8525.80, HS, state that “[t]his group covers cameras that capture images and convert them into an electronic signal.” Id.
Inasmuch as the JVC “HD/SD Memory Card Camcorder,” Model No. GY-HM150U, is fully described by the terms of subheading 8525.80, HTSUS, there is no dispute that the device is classifiable as “television cameras, digital cameras and video camera recorders” of HTSUS subheading 8525.80. Accordingly, because this dispute concerns the proper classification of the camera in either subheading 8525.80.40 or 8525.80.50, HTSUS, GRI 6 applies.
JVC asserts in its Protest/AFR that the HD/SD Memory Card Camcorder is properly classified under subheading 8525.80.40, HTSUS, which provides for “Digital still image video cameras.” Consequently, because the HD/SD Memory Card Camcorder is properly described as a device that is not capable of capturing digital “still” images, this dispute calls on CBP to evaluate the scope of HTSUS subheading 8525.80.40 to determine whether the phrase “digital still image video cameras” references a single function article capable only of capture digital videos and recording them by electronic means.
Here, CBP notes that the ENs to heading 85.25, HS, do not provide guidance concerning the scope of the phrase “digital still image video cameras” found in subheading 8525.80.40, HTSUS, because the 8-digit subheading exists only at the U.S. domestic level of the HTSUS. Consequently, although the Explanatory Notes can be useful in identifying the types of cameras classifiable at the international level under the 6-digit subheading 8525.80, HS, as “television cameras, digital cameras and video camera recorders,” the ENs to heading 85.25 are not dispositive of the instant Protest/AFR because this matter concerns classification of the JVC cameras at the 8-digit domestic level.
Recently, the U.S. Court of International Trade (CIT) provided guidance concerning the scope of subheading 8525.80.40, HTSUS, in the case Sony Electronics, Inc., v. United States, 35 Int’l Trade Rep. (BNA) 2395 (Ct. Int’l Trade Dec. 23, 2013). Specifically, the CIT examined the tariff classification of the Sony “NSC-GCI Net-Sharing Cam” as a “digital still image video camera” of subheading 8525.80.40, HTSUS, and held that the subheading encompasses those digital cameras capable of capturing both still images and moving images.
The Sony camera was a “Handycam,” (e.g. handheld) personal device capable of capturing still images at five different resolutions, as well as moving images at two resolutions at several different frames per second rates. The camera was equipped with 2MB of user-accessible internal memory to store digitally recorded still and moving images (saving still images in “.jpg” format and moving images in “.mp4” format). Additionally, the camera was designed to incorporate a removable flash memory stick (sold separately) for the storage of more than small numbers of still images or short durations of moving images. Later, the user would plug the Handycam into a personal computer (PC) via a universal serial bus (USB) cable and select which photos or video the user sought to download onto a computer or upload to the Internet.
Upon consideration of the scope of the phrase “digital still video camera” in subheading 8528.80.40, HTSUS, the CIT concluded that the Sony camera was properly classified therein, because both of the machine’s two functions, i.e., capturing still and moving digital images, were described by the phrase “digital still image video cameras.” In other words, the CIT found that HTSUS subheading 8525.80.40 describes machines that perform two functions—namely, capturing both still and moving digital images. Consequently, the CIT concluded that the Sony camera was properly classified under subheading 8525.80.40, because the tariff provision fully described the merchandise.
In reaching its decision that the phrase “digital still video cameras” means a machine that is capable of capturing moving and still images, the CIT was notably silent as to the question of whether a single-function camera that is only capable of capturing either still or moving digital images is classifiable under subheading 8525.80.40, HTSUS. Accordingly, although the CIT went to great lengths to demonstrate that the meaning of the term “video” in subheading 8525.80.40, HTSUS, has shifted toward moving images, the Court nonetheless restricted its analysis to the question of whether the subheading described machines capable of performing two distinct functions, i.e., capturing still and moving digital images. Finding that the phrase “digital still video cameras” describes such dual-function machines, the CIT concluded its analysis.
Here, because the capabilities and function of the instant JVC “HD/SD Memory Card Camcorder,” Model No. GY-HM150U, significantly differ from that of the camera at issue in Sony Electronics, Inc., v. United States, 35 Int’l Trade Rep. (BNA) 2395, CBP finds that the CIT’s classification of the Sony Handycam in subheading 8525.80.40, HTSUS, does not control the classification of JVC’s camera as a “digital still video camera.” Specifically, the “HD/SD Memory Card Camcorder,” Model No. GY-HM150U, is not capable of capturing still digital images. JVC’s Protest/AFR submission does not assert that the cameras are capable of capturing still images. Similarly, a review of product literature for the “HD/SD Memory Card Camcorder,” Model No. GY-HM150U, does not support a finding that the devices are capable of capturing still images. See JVC “GY-HM150U Compact Hand-Held 3-CCD Camcorder,” http://pro.jvc.com/prof/attributes/features.jsp?model_id=MDL102117 (last visited Feb. 16, 2017). Consequently, because the JVC camera is only capable of capturing moving digital images, CBP concludes that the device is not described by subheading 8525.80.40, HTSUS, which the CIT has instructed provides for those digital cameras capable of capturing both still images and moving images.
By contrast, the CIT has described subheading 8525.80.50, HTSUS, as the “basket ‘other’ category of subheading 8525.80 [that] will continue to capture those unusual items that do not fit into 8525.80's other subheadings.” Sony Electronics, Inc., v. United States, 35 Int’l Trade Rep. (BNA) 2395. Consistent with the CIT’s analysis, CBP classifies digital video cameras that do not possess the capability to capture still images in subheading 8525.80.50, HTSUS, as other digital cameras and video camera recorders. See New York Ruling Letter (“NY”) N265138, dated June 12, 2015 (classifying a digital video camera only capable of capturing moving images onto a removable memory card in subheading 8525.80.50, HTSUS); and HQ H083277, dated March 18, 2010 (classifying a digital video camera that lacked the ability to capture still images in subheading 8525.80.50, HTSUS).
Insomuch as the JVC “HD/SD Memory Card Camcorder,” Model No. GY-HM150U, is not capable of capturing digital still images, CBP finds that the camera is not described by the text of subheading 8525.80.40, HTSUS. As the camera is not described by the remaining eo nomine provisions of subheading 8525.80, HTSUS, the camera falls to classified as “other” under subheading 8525.80.50. Consequently, based on the analysis set forth in Sony Electronics, Inc., v. United States, 35 Int’l Trade Rep. (BNA) 2395, and prior CBP ruling letters, this office concludes that JVC “HD/SD Memory Card Camcorder,” Model No. GY-HM150U, is appropriately classified in subheading 8525.80.50, HTSUS, as other digital cameras and video camera recorders.
HOLDING:
By application of GRIs 6 and 1, the JVC “HD/SD Memory Card Camcorder,” Model No. GY-HM150U, is classified under heading 8525, HTSUS. Specifically, it is classifiable in subheading 8525.80.50, HTSUS, which provides for “Transmission apparatus for radio-broadcasting or television, whether or not incorporating reception apparatus or sound recording or reproducing apparatus; television cameras, digital cameras and video camera recorders: Television cameras, digital cameras and video camera recorders: Other.” The 2012 column one, general rate of duty for subheading 8525.80.50, HTSUS, is 2.1% ad valorem.
Pursuant to the above analysis, you are instructed to DENY the protest.
A copy of this ruling should be attached to the CBP Form 19 and provided to the protestant as part of the notice of action on the protest. Any re-liquidation of the 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 International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the U.S. Customs and Border Protection Home Page at http://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