CLA-2 OT:RR:CTF:TCM H043540 HkP
John A. Bessich, Esq.
Follick & Bessich, Attorneys at Law
33 Walt Whitman Road, Suite 204
Huntington Station, NY 11746
RE: Modification of NY J89049; Classification of satellite radio receivers/tuners (model SIR-PNP1) from Korea
Dear Mr. Bessich:
This letter concerns New York Ruling Letter (NY) J89049, issued to you on November 4, 2003, on behalf of your client Audiovox Corporation. At issue in that ruling was the classification of certain satellite radio devices, including satellite radio receivers/tuners, model SIR-PNP1, under the Harmonized Tariff Schedule of the United States (HTSUS). CBP classified the receivers/tuners in subheading 8527.90, HTSUS (2003), as “other reception apparatus”. It is now our position that this classification is incorrect and that the correct classification is under subheading 8527.91, HTSUS (2009) as other reception apparatus “combined with sound recording or reproducing apparatus.”
NY J89049 has previously been modified as it relates to the classification of the SIR-CK2 and SIR-HK1 docking stations. See Headquarters Ruling Letter HQ H008626, Nov. 28, 2008, and Notice of Revocation of one Ruling Letter, Modification of one Ruling Letter and Revocation of Treatment Relating to the Classification of a certain Satellite Radio Boombox and certain other Satellite Radio Receiver Docking Stations (“Notice of Revocation”), Customs Bulletin, Vol. 42, No. 52, Nov. 28, 2008. The classification of the SIR-CK1 FM transmitters described in NY J89049 is not affected by this action.
Pursuant to section 625(c), Tariff Act of 1930 (19 U.S.C. §1625(c)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed modification was published on May 29, 2009, in the Customs Bulletin, Vol. 43, No. 22. One comment was received from Audiovox in response to this notice in support of the proposed action.
In NY J89049 the merchandise at issue was described as follows:
SIR-PNP1 is a receiver/tuner that receives a transmitted satellite radiobroadcast signal and converts it to an analog signal. It does not have any amplification capability. It is designed to primarily receive the broadcast signal through the ether without any line connection. It further transmits that signal to the radio broadcast receiver within the automobile.
Subsequent to the issuance of NY J89049, CBP was informed by the importer that the description of the merchandise was incomplete because SIR-PNP1 receivers/tuners also had internal digital recording capability.
As a result of this information, CBP attempted to reclassify the merchandise in subheading 8527.31, HTSUS (2003) as “other radiobroadcast receivers … combined with sound recording or reproducing apparatus” by issuing NY K87747 (July 20, 2004). However, rulings which have been in effect for at least 60 days may only be modified in accordance with the provisions of 19 U.S.C. §1625(c), which requires that notice of the proposed action be published in the Customs Bulletin and that the public be allowed to comment on the proposed action for a period of at least 30 days. This procedure was not followed with respect to the purported reclassification of SIR-PNP1 receivers/tuners.
The original classification decision (NY J89049) was effective on November 4, 2003, and the purported reclassification was attempted on June 20, 2004 (NY K87747), more than 60 days later and was not published in the Customs Bulletin. Accordingly, CBP is voiding the portion of NY K87747 that addresses the classification of SIR-PNP1 receivers/tuners. See Modification of Two Ruling Letters Concerning the Classification of Certain Satellite Radio Receivers/Tuners and Revocation of Treatment, Attachment A (HQ H042575). HQ H043540, the instant ruling, which reclassifies the SIR-PNP1 receiver/tuner as other reception apparatus “combined with sound recording or reproducing apparatus”, is Attachment B to that Notice.
Pursuant to the 2007 updates to the HTSUS, goods classified under subheading 8527.31, HTSUS (pre-2007) are now classified, in relevant part, under subheading 8527.91, HTSUS.
What is the correct classification of the satellite radio receivers/tuners with internal digital recording capability under the HTSUS?
LAW AND ANALYSIS:
Classification of merchandise under the HTSUS is 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, the remaining GRIs 2 through 6 may then be applied in order.
The 2009 HTSUS provisions under consideration are as follows:
8527 Reception apparatus for radiobroadcasting, whether or not combined in the same housing, with sound recording or reproducing apparatus or a clock:
Combined with sound recording or reproducing apparatus:
8527.91.60 Other …..
8527.99.15 Other radio receivers …..
8527.99.40 Other …..
Based on the description in the FACTS section above of the way in which the receivers/tuners work, we find that they are provided for in heading 8527, HTSUS. Furthermore, because the receivers/tuners are combined with sound recording apparatus, they are provided for under subheading 8527.91, HTSUS.
By application of GRI 1, the SIR-PNP1 satellite radio receivers/tuners are classified in heading 8527, HTSUS. They are specifically provided for in subheading 8527.91.60, HTSUS, which provides for: “Reception apparatus for radiobroadcasting, whether or not combined, in the same housing, with sound recording or reproducing apparatus or a clock: Other: Combined with sound recording or reproducing apparatus: Other: Other.”
EFFECT ON OTHER RULINGS:
NY J89049, dated November 4, 2003, is modified with respect to the classification of SIR-PNP1 satellite radio receivers/tuners. The classification of the SIR-CK1 FM transmitters described therein is not affected. The classification of the SIR-CK2 and SIR-HK1 docking stations described in NY J89049 has been
modified by HQ H008626, Nov. 28, 2008. See Notice of Revocation, Customs Bulletin, Vol. 42, No. 52, Nov. 28, 2008.
Myles B. Harmon, Director
Commercial and Trade Facilitation Division