CLA-2 CO:R:C:G 087404 AJS

Mr. Samuel Pontieri
Vice President
K & M Custom Brokers, Inc
342 Westminster Avenue
P.O. Box 847
Elizabeth, New Jersey 07207-0847

RE: VHS modular component video system; Subheading 8521.10.00; Subheading 8525.30.00; Subheading 8528.10.80; General Rule of Interpretation 3; Explanatory Notes General Rule of Interpretation 3(b); composite good; General Rule of Interpretation 5(a); Explanatory Notes General Rule of Interpretation 5(a); specially shaped or fitted containers.

Dear Mr. Pontieri:

Your letter of May 14, 1990, requesting a tariff classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA), has been forwarded to this office for reply.

FACTS:

The article in question is a compact VHS modular component video system. The main component of the video system is a compact stand-alone VHS recorder/player. The other core components of the system are a LCD monitor with a built-in speaker, and a television camera with microphone which can be connected via cable or directly attached to the recorder/player. The system also includes an adapter, battery pack and cables. These components are put up together in a plastic carrying case with a molded interior.

ISSUE:

Whether the components of the video system in question are properly classifiable as a composite good within one subheading or each as a separate components within individual subheadings.

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LAW AND ANALYSIS:

Classification of merchandise under the HTSUSA is governed by the General Rules of Interpretation (GRI's). GRI 1 provides that classification shall be determined according to the terms of the headings and any relative section or chapter notes. If classification cannot be determined by the application of GRI 1 then the subsequent GRIs must be consulted.

Heading 8521, HTSUSA, provides for video recording or reproducing apparatus. The main component of the video system is a video recorder/player. Subheading 8521.10.00, HTSUSA, provides for magnetic tape-type video recording or reproducing apparatus. The video recorder/player satisfies the terms of this subheading. However, the video system does not satisfy the terms of this subheading because the system contains other core components which are, prima facie, described within subheading 8525.30.00 (camera) and subheading 8528.10.80 (monitor). Accordingly, the video system is precluded from classification within subheading 8521.10.00, HTSUSA, by the application of GRI 1.

GRI 3 governs the classification of "composite goods consisting of different components" ("composite goods") which are, prima facie, classifiable within two or more headings. The term "composite goods" refers to an article consisting of "separable components, provided these components are adapted one to the other and are mutually complementary and that together they form a whole which would not normally be offered for sale in separate parts." GRI 3(b) Explanatory Note (EN) (IX). The video system satisfies this description. The system consists of components which are separable but can be attached by cables or fitted together. The components are adapted to be used in different combinations as a portable and complete video system. They are mutually complementary to each other in that they perform operations essential for the use of video technology. The camera takes pictures, which are recorded on the recorder/player, and then viewed on the monitor when it is attached to the recorder/player. In addition, the system is designed to be carried about in carrying case with a separate molded compartment for each component. Lastly, the design and intended use of these components would prevent them from normally being sold separately. Accordingly, the video system is a "composite good" classifiable by the application of GRI 3(b).

GRI 3(a) requires the heading which provides the most specific description of the composite good to be preferred to headings which provide a more general description. However, when two or more headings each refer to part only of the components contained in a composite good, those headings are to be regarded

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as equally specific in relation to those goods. GRI 3. Headings 8521, 8525, and 8528 of the HTSUSA refer to only part of the components in the video system. Accordingly, no heading provides a specific description of the video system.

GRI 3(b) requires "composite goods", which cannot be classified by reference to 3(a), to be classified as if they consisted of the component which gives the composite good its essential character. The factor which determines essential character will vary as between different kinds of goods. GRI 3(b) EN (VII). It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods. EN (VII). In this case, the role of the video recorder/player in relation to the use of the video system determines essential character. The submitted literature states that the main component of the system is the video recorder/ player. The recorder/player can separately be used with either the monitor or camera. The other core components (i.e., monitor and camera) both must be used with the video recorder/player in order to function properly. Accordingly, the video system is classifiable as if it consisted solely of the video recorder/ player because this component gives the composite good its essential character. As stated previously, the video recorder/player is classifiable within subheading 8521.10.00, HTSUSA. Therefore, the video system as a whole is also properly classifiable within this subheading.

GRI 5(a) states that certain cases and similar containers which are "specially shaped or fitted to contain a specific article or set of articles, suitable for long-term use and presented with the articles for which they are intended, shall be classified with such articles when of a kind normally sold therewith." Containers which are "specially shaped or fitted" to contain a set of articles are those designed specifically to accommodate the articles for which they are intended. GRI 5(a) EN I(1). The interior of the subject container is molded to specifically accommodate each component of the video system. This type of container is specially shaped or fitted to contain a specific set of articles.

A GRI 5(a) container must also be suitable for long term use. GRI 5(a) EN I(2). It must be designed to have a durability comparable to that of the articles for which it is intended. EN I(2). These containers also serve to protect the articles when not in use (during transport or storage, for example). EN I(2). The container at issue satisfies these requirements. It is suitable for long term use, possesses durability, and serves to protect the video system.

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A GRI 5(a) container must additionally be presented with the articles for which it is intended. GRI 5(a) EN I(3). The subject container will be presented with each of the components of the video system located in their intended compartments. Accordingly, the container at issue satisfies this requirement.

A GRI 5(a) container must be of a kind normally sold with such articles. A system such as this necessarily requires some type of container in order to enable the system to be portable. We consider the container at issue of the kind which would normally be sold with a miniaturized and portable video system.

A GRI 5(a) container must not give the whole its essential character. The subject container is designed to accommodate a monitor, recorder/player, and camera as well as other components. It is used for transport and protection of its contents. This type of container does not give the whole its essential character.

The container in question satisfies all of the requirements of GRI 5(a). Accordingly, it a specially fitted container which is required to be classified with the articles which it is intended to contain. GRI 5(a). The carrying case is intended to contain the components of the video system. Therefore, the case is classifiable with the video system within subheading 8521.10.00, HTSUSA.

HOLDING:

The subject video system satisfies the description of a GRI 3(b) composite good and is properly classifiable within subheading 8521.10.00, HTSUSA, which provides for magnetic tape- type video recording or reproducing apparatus, dutiable at the rate of 3.9 percent ad valorem.

The subject carrying case satisfies the description of a GRI 5(a) specially shaped or fitted container and is properly classifiable with the video system within subheading 8521.10.00, HTSUSA.

Sincerely,


John Durant, Director
Commercial Rulings Division