CLA-2 OT:RR:CTF:EMAIN H308993 NVF
Port Director
U.S. Customs and Border Protection
301 E Ocean Blvd.
FL 7
Long Beach, CA 90802
Attn: Brian S. Jansen, Import Specialist
RE: Application for Further Review of Protest No. 2704-20-108846; Classification of Bluetooth® LED Bulb
Dear Port Director:
This letter is in response to the Application for Further Review (“AFR”) of Protest No. 2704-20-108846, timely filed by All-Ways Forwarding of NY, Inc. on behalf of protestant, Merkury Innovations LLC (“Merkury”). The protest contests the classification and liquidation by Customs and Border Protection of Bluetooth® light-emitting diode (LED) bulb under heading 3924 of the Harmonized Tariff Schedule of the United States (“HTSUS”).
FACTS:
The merchandise at issue is identified as a Bluetooth® LED bulb, item# MI-BW904-999W, which is an LED light bulb with a built-in Wi-Fi module. According to the information provided, the article is a shape “A” light bulb with an Edison screw base, heat sink (housing), a plastic diffuser (globe), and LED and electric components. The built-in Wi-Fi module is used to facilitate the control of the light color and lighting schedule via a smartphone or voice.
The subject merchandise was imported from China on October 2, 2018 under heading 3924, HTSUS as tableware, kitchenware and other household articles and hygienic or toilet articles, of plastics. Merkury later amended its entry stating the goods were classified under heading 8517, HTSUS as other apparatus for the transmission or reception of voice, images or other data. On July 19, 2019, CBP liquidated the entry under heading 3924, HTSUS. Merkury filed a protest and Application for Further Review (“AFR”) on January 9, 2020.
In its protest, Merkury asserts that the subject merchandise should be classified under heading 8517, HTSUS 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. Upon reviewing the protest, the port has indicated that it believes the Bluetooth® LED bulb should be classified under heading 8539, HTSUS as light-emitting diode (LED) lamps.
ISSUE:
Whether a Bluetooth® LED lightbulb is classified under heading 8517, HTSUS as apparatus for the transmission or reception of voice, images or other data, or under heading 8539, HTSUS as light-emitting diode (LED) lamps.
LAW AND ANALYSIS:
We observe as an initial matter that the matters protested are protestable under 19 U.S.C. § 1514(a)(2) as decisions on classification and amount of duties chargeable. The subject merchandise was entered by Merkury on October 2, 2018. On July 19, 2019, CBP liquidated the entry. On January 9, 2020, Merkury timely filed a protest and AFR, within 180 days of liquidation of the first entry. 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). Further review of the protest is properly accorded to protestant pursuant to 19 C.F.R. § 174.24(a) because the decision against which the protest was filed is alleged to be inconsistent with a previous CBP decision concerning substantially similar merchandise.
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 provisions of law for all classification purposes.
The 2018 HTSUS headings under consideration are as follows:
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.
8539 Electrical filament or discharge lamps, including sealed beam lamp units and ultraviolet or infrared lamps; arc lamps; light-emitting diode (LED) lamps; parts thereof:
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. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the heading and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied in order.
Notes 3 and 5 of Section XVI, HTSUS, which covers headings 8517 and 8539, provide the following:
3. Unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines designed 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.
5. For the purposes of these notes, the expression "machine" means any machine, machinery, plant, equipment, apparatus or appliance cited in the headings of chapter 84 or 85.
Heading 8517, HTSUS covers, among other things, apparatus for the transmission or reception of data, including apparatus for communication in a wireless network. CBP has classified some composite machines with Bluetooth® or Wi-Fi under heading 8517, notably wearable fitness trackers and smartwatches. Headquarters Ruling Letter (HQ) H286610 (Aug. 8, 2017); HQ H279898 (Apr. 5, 2017); HQ H265035 (Jan. 19, 2016); HQ H285617 (May 4, 2018), and HQ H282905 (Apr. 30, 2018).*
Nonetheless, composite machines with Bluetooth® or Wi-Fi capabilities do not default to heading 8517, HTSUS, but rather are classified in the heading that describes their principal function or essential character. For example, in HQ H283180 (Jan. 21, 2020), CBP determined that certain “SmartPlugs”, which could be controlled by Wi-Fi were not classified in heading 8517. In so doing, CBP observed that the principal function of the SmartPlugs was not the transmission of data but rather to control the electrical current running to appliances to which they are connected. Similarly, in HQ H281100 (June 27, 2018), CBP discussed its prior ruling concerning the classification of Bluetooth® enabled speakers and determined that the Bluetooth® chip did not impart the principal function. Notably, CBP has declined to classify items in heading 8517 when the exchange of data facilitated by Wi-Fi or Bluetooth® capability did not constitute the principal function of the subject merchandise. See also NY N297309 (June 20, 2018) (alarm clock with Bluetooth®); HQ H271909 (July 8, 2016) (analog watch with Bluetooth®); NY N245407 (Sep. 19, 2013) (basketball with Bluetooth®).
In this case, the subject merchandise is a Bluetooth® enabled light bulb. Aside from its Bluetooth® capabilities, the lightbulb is otherwise a standard LED bulb with an Edison screw base, enabling it to be used in the vast majority of available lighting devices. Although Bluetooth® transceiver can be used to turn the light bulb on and off, the principal function of the subject light bulbs is not the transmission or reception of data. Rather, to the extent that data is transmitted via Bluetooth®, it is in service of the principal function of providing light. Pursuant to Note 3 of Section XVI of the HTSUS, we find that the components of the light bulb that contribute to the transmission of data are ancillary to the principal function of providing light.
In light of the foregoing, we conclude that the Bluetooth® LED light bulb is classified under heading 8539, HTSUS as light-emitting diode (LED) lamps.
HOLDING:
By application of GRIs 1 (Note 3 to Section XVI) and 6, the subject Bluetooth® LED light bulb is classified in heading 8539, specifically subheading 8539.50.00 of the 2018 HTSUS, which provides for: Electrical filament or discharge lamps, including sealed beam lamp units and ultraviolet or infrared lamps; arc lamps; light-emitting diode (LED) lamps; parts thereof: Light-emitting diode (LED) lamps. The 2018 general column one rate of duty is 2% ad valorum.
You are instructed to DENY the protest.
In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP 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 Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the Customs Rulings Online Search System (“CROSS”) at https://rulings.cbp.gov/, which can be found on the CBP website at http://www.cbp.gov and other methods of public distribution.
Sincerely,
Craig T. Clark, Director
Commercial and Trade Facilitation Division