CLA-2 CO:R:C:M 088746 MBR

Mr. Gregory C. Dorris
Suite 800
700 Thirteenth Street, N.W.
Washington, D.C. 20005

RE: The Weather Star IV; Satellite Cable Television Transmission Headend Signal Processor; Transmission Apparatus; 8525

Dear Mr. Dorris:

This is in reply to your letter of December 6, 1990, on behalf of The Weather Channel, Inc., requesting classification of the "Weather Star IV" cable television transmission headend signal processor, under the Harmonized Tariff Schedule of the United States (HTSUSA).

FACTS:

The Weather Star IV is a cable television transmission headend signal processor. It utilizes video, audio, and data signals from a satellite transponder receiver to which it is connected and presents television programming for output to cable customers. The word "STAR" in the name of the system is an acronym that stands for "Satellite Transponder Addressable Receiver." The hardware is said to consist of a casing, mainframe, power supply, input/output board, central processing board, graphics controller display, RAM, and an audio detector/ FSK board in a common housing. This hardware is said to be dedicated to its function.

The Weather Star IV is located at a cable headend. A "headend" is a cable television industry term for a combination of television signal transmission apparatus. Each system is individually configured for a particular customer. Generally, the merchandise receives satellite television signals, modifies the signal, and then transmits the signal into a cable television or closed circuit television system. Thus, the headend serves an integral function in the cable TV transmission chain. Headends contain combinations of modulators/ demodulators, converters, -2-

signal processors/ generators, combiners, amplifiers, and receivers.

The Weather Star IV is essentially a signal processor. It is not packaged, designed, sold, (or even usable) for residential use. It is used expressly in closed circuit/ cable television applications. The Weather Star IV does not convert an NTSC (standard television broadcast signal) into the end point signal intended to be displayed on a television picture tube. Instead, it produces an NTSC signal for further transmission, reception, and subsequent display.

Additionally, a general purpose keyboard will be imported with the subject unit which will enable a local operator to input a message or data into an audio or visual television signal.

ISSUE:

What is the classification of the Weather Star IV satellite cable television transmission headend signal processor, under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA)? Is the appropriate classification under heading 8525, HTSUSA, which provides for: "[t]ransmission apparatus...", or under 8528, HTSUSA, which provides for: "[t]elevision receivers...?"

LAW AND ANALYSIS:

The General Rules of Interpretation (GRI's) to the HTSUSA govern the classification of goods in the tariff schedule. GRI 1 states, in pertinent part:

...classification shall be determined according to the terms of the headings and any relative section or chapter notes...

NY 832058, dated October 6, 1988, held that the instant merchandise was classifiable under item 685.0806, TSUS, and under subheading 8529.90.35, HTSUSA, which provides for: "[p]arts suitable for use solely or principally with the apparatus of headings 8525 to 8528: [o]ther: [o]ther: [o]ther."

However, subsequently, HQ 088255, dated December 17, 1990, held that an integrated receiver/ decoder for a satellite cable television headend was properly classifiable under heading 8525, HTSUSA, which provides for transmission apparatus. Furthermore, HQ 087724, dated April 2, 1991, held that an entire satellite cable television headend was classifiable under 8525, HTSUSA.

The Weather Star IV is prima facie classifiable under the following headings:

8525 Transmission apparatus for... television, whether or not -3-

incorporating reception apparatus...:

8525.10.20.20 Transmission apparatus: Television: Converters, decoders, pre-amplifiers, line amplifiers, distribution amplifiers and other amplifiers; directional couplers and other couplers; all the foregoing designed for cable or closed circuit television applications

* * * * * * * * * * * * *

8528 Television receivers (including video monitors and video projection television receivers),...:

8528.10.80.55 Color: Other television receivers: Not having a picture tube

Clearly, there has been a certain amount of confusion as to what this merchandise is and how it functions. Additionally, the scope of the two competing provisions is at issue.

However, the Weather Star IV does not convert an NTSC (standard television broadcast signal) into the end point signal intended to be displayed on a television picture tube. Instead, it produces an NTSC signal for further transmission and final reception and display.

Heading 8528, HTSUSA, which provides for television receivers is actually a more narrow heading than it may at first appear. The Harmonized Commodity Description and Coding System Explanatory Notes (EN) to heading 8528, page 1378, state in pertinent part:

This heading covers television receivers (including video monitors and video projectors), whether or not combined, in the same housing, with radio-broadcast receivers or sound or video recording or reproducing apparatus.

The heading includes:

(1) Television receivers of the kind used in the home (table models, consoles, etc.) including coin-operated television sets.

(3) Video tuners, intended to be used with or incorporated in, e.g., video recording or reproducing apparatus or video monitors. These tuners convert high-frequency television signals into signals usable by video recording or reproducing apparatus or video monitors. However, devices which simply isolate high-frequency television signals (sometimes called video tuners) are to be classified as parts in heading 8529. -4-

(4) Television receivers for industrial use (e.g., for reading instruments at a distance, or for observation in dangerous localities). With this apparatus the transmission is often by line.

(5) Video monitors which are receivers connected directly to the video camera or recorder by means of co-axial cables, so that all the high frequency circuits are eliminated. They are used by television companies or for closed circuit television (airports, railway stations, steel plants, hospitals, etc.).

(6) Video projectors, which enable the image normally reproduced on the screen of a video receiver to be projected on a large screen.

(7) Television apparatus of all types equipped to receive, memorize and display texts and messages.

Thus, the EN to Heading 8528, HTSUSA, delineates end point apparatus where the image is received and displayed, such as: television receivers used in the home, video tuners intended to be used with or incorporated in video recording or reproducing apparatus or video monitors, video projectors, and apparatus to memorize and display texts and messages.

However, the instant Weather Star IV is in the transmission path, but is not at the end of the transmission path where final reception and viewing takes place. Its function is to process a satellite signal that is subsequently transmitted or relayed, in the form of an NTSC signal to cable television subscribers, to be received and displayed at the end of the transmission path. Therefore, the Weather Star IV cannot be considered "television receivers," as provided for under heading 8528, HTSUSA.

The Harmonized Commodity Description and Coding System Explanatory Notes (EN) to heading 8525, page 1374, state:

This group includes:

(1) Transmitters of all kinds.

(2) Relay apparatus used to pick up a broadcast and retransmit it and so increase the range.

(3) Relay television transmitters for transmission, by means of an aerial and parabolic reflector, from the studio or site of an outside broadcast to the main transmitter.

(4) Television transmitters for industrial use (e.g., for reading instruments at a distance...) -5-

The function of the Weather Star IV is to process a satellite cable television signal at the headend to generate the NTSC signal for transmission to the cable television subscriber's "television receiver" for final reception and display. Almost all transmitters and relay apparatus must, by their very nature, contain a receiver, since they must receive a signal before they can transmit or relay it. Heading 8525, HTSUSA, envisioned this and provides for: "transmission apparatus for... television, whether or not incorporating reception apparatus."

The Weather Star IV consists of a number of machines combined together to perform a specific function (including a general purpose keyboard). Section XVI, Note 4, requires the classification of "functional units" to be within the heading appropriate to the function of the unit. Section XVI, Note 4, states:

Where a machine (including a combination of machines) consists of individual components (whether separate or interconnected by piping, by transmission devices, by electric cables or by other devices) intended to contribute together to a clearly defined function covered by one of the headings in chapter 84 or chapter 85, then the whole falls to be classified in the heading appropriate to that function.

In the instant case, the Weather Star IV is a combination of machines, interconnected by electric cables, intended to contribute together to the clearly defined function of "transmission apparatus for... television, whether or not incorporating reception apparatus."

The instant Weather Star IV appears to be of the same class of merchandise ruled upon in HQ 087724, dated April 2, 1991, and HQ 088255, dated December 17, 1990, which held that headend apparatus for cable or closed circuit television applications was properly classifiable under heading 8525, HTSUSA, which provides for transmission apparatus. Therefore, we find that the Weather Star IV is also properly classifiable under heading 8525, HTSUSA.

HOLDING:

The Weather Star IV satellite cable television headend signal processor is classifiable under 8525.10.20.20, HTSUSA, which provides for: "[t]ransmission apparatus for... television, whether or not incorporating reception apparatus...: [t]ransmission apparatus: [t]elevision: [c]onverters, decoders, pre-amplifiers, line amplifiers, distribution amplifiers and

-6-

other amplifiers; directional couplers and other couplers; all the foregoing designed for cable or closed circuit television applications."

Sincerely,

John Durant, Director
Commercial Rulings Division