CLA-2 CO:R:C:M 950069 DWS
Mr. Ned Marshak
Sharretts, Paley, Carter & Blauvelt, P.C.
67 Broad Street
New York, NY 10004
RE: Low-Powered Transceivers; Children's Walkie-Talkies;
Reconsideration of HQ 087021
Dear Mr. Marshak:
As requested by your letter of August 1, 1991, we have
reconsidered HQ 087021, dated July 19, 1991, concerning the
classification of low-powered transceivers (walkie-talkies)
under the Harmonized Tariff Schedule of the United States
Annotated (HTSUSA).
FACTS:
The merchandise at issue are low-powered transceivers
(walkie-talkies). They operate on a frequency of 49.82 - 48.90
megahertz ("MHz"). They have flexible antennas, a send button, a
morse code button, volume control and a plastic belt clip. They
are sold in sets of two. Each transceiver requires a 9 volt
battery. The housing has blue highlighting, false brackets and
false screws, a sticker with the AT&T logo (new models no longer
have the AT&T sticker), and is constructed of plastic. The
packaging states: "For ages 5 and up." Our research indicates
that the transceiver has a retail price of $5.00. Also, it has a
range of 92 yards, outdoors, when in line-of-sight. As noted in
HQ 087021, the transceiver is "designed primarily for the
amusement of children, and are sold in toy stores and major
department stores." You agree that these low-powered
transceivers are "principally used for the amusement of children
and [are] not an article of utility."
ISSUE:
What is the classification of low-powered transceivers
(walkie-talkies), designed for the amusement of children, under
the HTSUSA?
LAW AND ANALYSIS:
Classification of merchandise under the HTSUSA is in
accordance with the General Rules of Interpretation (GRI's),
taken in order. GRI 1 provides that classification is determined
according to the terms of the headings and any relative section
or chapter notes.
It is your position that the merchandise is classifiable
under subheading 8525.20.20, HTSUSA, which provides for:
"[t]ransmission apparatus incorporating reception apparatus:
[t]ransceivers: [l]ow-powered radiotelephonic transceivers
operating on frequencies from 49.82 to 49.90." However, in HQ
087021, the merchandise was classified under subheading
9503.70.80, HTSUSA, which provides for: "[o]ther toys, put up in
sets or outfits, and parts and accessories thereof: [o]ther:
[o]ther."
Section XVI, Note 1(p) provides that: "[t]his section does
not cover: Articles of chapter 95." Chapter 85, HTSUSA, is
contained within Section XVI. In understanding the HTSUSA, the
Harmonized Commodity Description and Coding System Explanatory
Notes may be utilized. The Explanatory Notes, although not
dispositive, are to be used to determine the proper
interpretation of the HTSUSA. 54 Fed. Reg. 35127, 35128
(August 23, 1989). Explanatory Note 95.03(A) (p. 1588) provides
that:
Certain toys (e.g., electric irons, sewing machines, musical
instruments, etc.) may be capable of a limited "use"; but
they are generally distinguishable by their size and limited
capacity from real sewing machines, etc.
As noted, you agree that the merchandise "is principally
used for the amusement of children and is not an article of
utility." It has been documented that these transceivers have a
very limited range. In addition the merchandise is not made of
durable construction (thin plastic, false brackets, false
screws). You state that the merchandise is "designed to be used
in the identical manner as an adult walkie-talkie." This may be
true, but the point is irrelevant. The relevant point, according
to the Explanatory Notes, is that the merchandise is of a very
limited use. It is designed and principally used as a toy for
the amusement of children and not as an article of utility, and
therefore it is our position, as stated in HQ 087021, that the
merchandise is correctly classifiable under heading 9503, HTSUSA.
You contend that previous classification of children's
walkie-talkies as low-powered transceivers under the Tariff
Schedules of the United States (TSUS) should be our principle
guide in classifying the subject merchandise under the HTSUSA.
The HTSUSA, effective since January 1, 1989, is a new tariff
system and the rules of how it is interpreted and applied are
somewhat different from the TSUS. As noted in H. Conf. Rep. No.
576, p. 550, on a case-by-case basis TSUS decisions should be
considered instructive in interpreting the HTSUSA, particularly
where the nomenclature previously interpreted in those decisions
remains unchanged and no dissimilar interpretation is required by
the text of the HTSUSA. In this instance, a dissimilar
interpretation is indicated by the Explanatory Notes, which state
that children's low-powered transceivers are classifiable as
toys. Therefore, we do not find previous TSUS decisions
instructive in this case.
HOLDING:
The low-powered transceivers (walkie-talkies) are
classifiable under subheading 9503.70.80, HTSUSA, which provides
for: "[o]ther toys, put up in sets or outfits, and parts and
accessories thereof: [o]ther: [o]ther." HQ 087021 is affirmed in
full.
Sincerely,
John Durant, Director
Commercial Rulings Division