CLA-2 OT:RR:CTF:TCM H171880 AMM
Port Director
U.S. Customs and Border Protection
Service Port – Kansas City
4100 N. Mulberry Drive, Suite 110 Kansas City, MO 64116
Attn: Import Specialist Yvonne Williams
RE: Tariff classification of certain LED Lamps; Protest Number 4501-10-100037
Dear Port Director:
This is in reply to an application for further review (AFR) of protest number 4501-10-100037, dated May 27, 2010, filed on behalf of The Coleman Corporation (Coleman), against U.S. Customs and Border Protection’s (CBP) reclassification and subsequent liquidation of one entry at the Service Port of Kansas City (the Port) of various LED Lamps, under the Harmonized Tariff Schedule of the United States (HTSUS). We have also considered two (2) supplemental submissions, filed on October 1, 2010, and August 3, 2011.
FACTS:
The instant products are identified as the Model No. 4347-703 “Exponent Headlamp” and the Model No. 2000001870 “Pack-Away Lantern”. The Exponent Headlamp is a battery-powered headlamp designed to be worn by a person. It includes adjustable fabric straps, a battery pack designed to hold three (3) AAA sized batteries, and five LED bulbs in a metal and plastic housing. The Pack-Away Lantern is a battery-powered hand-held lantern with a flat base. It includes a metal handle on the top of the lantern with a detent catch for locking when it is not in use. The plastic and metal housing is designed to contain four (4) AA sized batteries and one LED bulb. Pictures of both products are provided below:
3AAA Exponent Headlamp
Model No. 4347-703
4AA Pack-Away Lantern (open and closed)
Model No. 2000001870
The entry took place at the Port on January 23, 2009, and was liquidated on December 4, 2009. The merchandise was entered in heading 8543, HTSUS, which provides in pertinent part for “Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter …”. The Port liquidated both products under heading 8513, HTSUS, specifically under subheading 8513.10.40, HTSUS, which provides for “Portable electric lamps … : Lamps: Other”.
ISSUE:
What is the proper classification under the HTSUS of the Exponent Headlamp and the Pack-Away Lantern?
LAW AND ANALYSIS:
Initially we note that the matter is protestable under 19 U.S.C. §1514(a)(2) as a decision on classification and the rate and amount of duties chargeable. The protest was timely filed on May 28, 2010, within 180 days of liquidation, pursuant to 19 U.S.C. §1514(c)(3).
Further review of Protest 4501-10-100037 was properly accorded to protestant pursuant to 19 C.F.R. §174.24. Specifically, in accordance with Section 174.24(b), the decision against which the protest was filed is alleged to involve questions of law or fact which have not been ruled upon by the Commissioner of Customs or his designee or by the Customs courts. Coleman alleges that the merchandise is properly classified under heading 8541, HTSUS, an argument that was not considered at the time of the protest.
Classification of goods under the HTSUS is governed by the General Rules of Interpretation (GRI). GRI 1 provides that classification 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 GRI may then be applied.
The 2011 HTSUS provisions under consideration are:
8513 Portable electric lamps designed to function by their own source of energy (for example, dry batteries, storage batteries, magnetos), other than lighting equipment of heading 8512; parts thereof:
8513.10 Lamps:
8513.10.40 Other
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8541 Diodes, transistors and similar semiconductor devices; photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels; light-emitting diodes; mounted piezoelectric crystals; parts thereof:
8541.40 Photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels; light-emitting diodes:
8541.40.20 Light-emitting diodes (LED's)
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8543 Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof:
8543.70 Other machines and apparatus:
8543.70.70 Electric luminescent lamps
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Other:
Other:
8543.70.96 Other
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Note 8 to Chapter 85, HTSUS, states, in pertinent part: “
(a) “Diodes, transistors and similar semiconductor devices” are semiconductor devices the operation of which depends on variations in resistivity on the application of an electric field;
* * *
For the classification of the articles defined in this note, headings 8541 and 8542 shall take precedence over any other heading in the Nomenclature …
* * *
The Harmonized Commodity Description and Coding System Explanatory Notes (EN), constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the EN provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of the headings. It is CBP’s practice to consult, whenever possible, the terms of the ENs when interpreting the HTSUS. See T.D. 89–80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The EN to heading 85.13 states, in pertinent part:
This heading covers portable electric lamps designed to function by means of a self contained source of electricity (e.g., dry cell, accumulator or magneto). They comprise two elements (i.e., the lamp proper and the source of electricity) which are usually mounted and directly connected together, often in a single case. In some types, however, these elements are separate and are connected by wires. The term “portable lamps” refers only to those lamps (i.e., both the lamp and its electricity supply) which are designed for use when carried in the hand or on the person, or are designed to be attached to a portable article or object. They usually have a handle or a fastening device and may be recognised by their particular shapes and their light weight.
* * *
The lamps of this heading include:
* * *
(2) Other hand lamps (including those with an adjustable beam). Hand lamps are often fitted with a simple device for hanging them temporarily on a wall, etc., while others are designed so that they can be placed on the ground.
* * *
(6) Examination lamps for general use, fixed to a headband (which usually consists of a curved strip of metal). Such lamps are classified here only if they have their own source of current (dry battery in user’s pocket, for example). The lamps of this heading are used by doctors, watchmakers, jewellers, etc. Specialised medical inspection lamps (e.g., for throat or ear inspection) are excluded (heading 90.18).
* * *
The EN to heading 85.41 states, in pertinent part:
(C) LIGHT EMITTING DIODES
Light emitting diodes, or electroluminescent diodes, (based, inter alia, on gallium arsenide or gallium phosphide) are devices which convert electric energy into visible, infra-red or ultra-violet rays. They are used, e.g., for displaying or transmitting data in control systems.
* * *
The EN to heading 85.43 states, in pertinent part:
This heading covers all electrical appliances and apparatus, not falling in any other heading of this Chapter, nor covered more specifically by a heading of any other Chapter of the Nomenclature, nor excluded by the operation of a Legal Note to Section XVI or to this Chapter.
* * *
The heading includes, inter alia:
* * *
(16) Electro-luminescent devices, generally in strips, plates or panels, and based on electro-luminescent substances (e.g., zinc sulphide) placed between two layers of conductive material.
* * *
The importer entered the instant merchandise under heading 8543, HTSUS, as “Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter”. The Port liquidated this merchandise under heading 8513, HTSUS, as “Portable electric lamps designed to function by their own source of energy”. Coleman argues in their protest that the merchandise is properly classified under heading 8543, HTSUS. Also, in their Supplemental Argument, dated October 1, 2010, Coleman argues that the merchandise is properly classified under heading 8541, HTSUS, which provides in pertinent part for “[L]ight emitting diodes”.
According to Note 8 to Chapter 85, HTSUS, CBP must first consider whether the instant merchandise is properly classified under 8541, HTSUS, which provides, in part, for “light-emitting diodes.” CBP has previously determined that the provision for LEDs in heading 8541, HTSUS, covers only the individual LEDs (i.e., the semiconductor diodes without components ancillary to the function of the LEDs). See Headquarters Ruling (HQ) H024874; HQ H024876; HQ H024878; and HQ H095035, each dated March 31, 2010. See also HQ H011693, dated December 18, 2007; HQ H010636, dated December 3, 2007; HQ H003215, dated October 10, 2007; and HQ 966401, dated June 29, 2004.
Coleman specifically alleges that this position is inconsistent with the Court of International Trade’s decision in ABB Power Transmission v. United States, 896 F.Supp. 1279 (Ct. Int’l. Trade 1995), and that this case directs CBP to classify the instant merchandise under heading 8541, HTSUS.
In ABB Power Transmission, the court considered the classification of thyristor modules, the main function of which was to block current when they were turned off and to conduct current when they were turned on. Id., at 1283. Each thyristor module consisted of six thyristor elements connected in a series, heatsinks, voltage divider circuits and electronic “firing” circuitry. The components were mounted on a frame of epoxy resin and aluminum. The parties disagreed as to whether the other components made the module significantly different from a thyristor such that the modules could not be classified as thyristors within heading 8541, HTSUS. Although the Court “agree[d] with the [government] that the modules contained significant components in addition to thyristors, it found that the function the modules performed fell within the definition of a thyristor as a similar semiconductor device.” Id., at 1284.
The Court defined the term “function” as “the activity appropriate to the nature or position of a thing.” Id., at 1284. In that case, the “components of [the] thyristor module contribute to the clearly defined ‘activity’ of a thyristor as a semiconductor device (allowing current to pass in one direction when a controlled pulse initiates conductivity)”. Id. As a result, the court classified the modules as thyristors in heading 8541, HTSUS.
In order to be classified as an LED under the analysis of ABB Power Transmission, the functions performed by the components added to the instant merchandise must fall within the definition of an LED. Id., at 1284. LEDs are described by EN(c) to 85.41. One additional authoritative source states that an LED is a rectifying semiconductor device which converts electrical energy into electromagnetic radiation when current is applied. McGraw-Hill Concise Encyclopedia of Science and Technology, 5th Ed., 2005 at 1252.
The instant products do incorporate one or more LED bulbs into their housings. However, using the common, commercial and textual explanations of the function of an LED cited above, the instant merchandise has components with important functionalities other than that of an LED. For instance, both products contain a battery, whose function is to supply electric current to the LED bulbs. Furthermore, the products include design features enabling them to be carried by a person, either by means of a strap which fits around the head or by a handle incorporated in the housing. They also have housings which function to contain the LEDs and other components. As such, the instant merchandise contains components which do not contribute to the clearly defined activity of an LED as a semiconductor device which converts electrical energy into electromagnetic radiation when current is applied. ABB Power Transmission, 896 F.Supp. at 1284. Hence, the instant products are beyond the scope of heading 8541, HTSUS, because they perform functions other than those of an LED. See HQ H024874; HQ H024876; HQ H024878; HQ H095035; HQ H011693; HQ H010636; HQ 966401; and New York Ruling Letter (NY) K85367, dated May 17, 2004.
Next, we consider whether the instant products are properly classified under heading 8513, HTSUS, which provides in pertinent part for “Portable electric lamps designed to function by their own source of energy”. The term “portable electric lamp” is not defined in the HTSUS. The phrase “portable lamps” is defined in the Explanatory Notes in the following manner:
The term “portable lamps” refers only to those lamps (i.e., both the lamp and its electricity supply) which are designed for use when carried in the hand or on the person, or are designed to be attached to a portable article or object. They usually have a handle or a fastening device and may be recognised by their particular shapes and their light weight.
See EN to 85.13. CBP has previously determined that a “lamp” is a device which provides an isolated source of heat or light. See HQ H068435, dated October 16, 2009 (snowflake pathway markers); HQ H042586, dated January 29, 2009 (fiber optic lamp), HQ 966952, dated August 18, 2004 (litecube), and HQ 965248, dated July 26, 2002 (bubble lights) (citing The Random House College Dictionary (1973) at 752 and Webster’s New Collegiate Dictionary (1979) at 639).
Each product under consideration has a battery supply which provides it with electric power. Each product provides an isolated source of light when activated. In their protest, Coleman admits, and CBP agrees, that the products at issue are electric, and that they are lamps. Therefore, the products at issue are electric lamps. Their classification in heading 8513, HTSUS, rests on whether they are “portable” as defined in the EN.
“Whether an article is ‘specially designed’ or ‘specially constructed’ for a particular purpose may be determined by an examination of the article itself, its capabilities, as well as its actual use or uses. One must look at both the structural and auxiliary design features, as neither by itself is determinative.” Western States Import v. United States, 20 C.I.T. 736 (1996). With regard to the instant products, we must determine whether they have any particular design features that adapt it for the stated purpose of being either carried in the hand or on the person. See HQ 965714, dated November 15, 2002. These design features include, but are not limited to, handles, fastening devices, ergonomic shapes capable of fitting easily into the hand, and use of light weight materials.
The Exponent Headlamp is specifically designed to be worn on a person’s head, and incorporates a series of adjustable, flexible fabric straps for that purpose. The Pack-Away Lantern is specifically designed to be carried in a person’s hand, by means of the handle attached to the housing. Therefore, the instant products are “designed for use when carried in the hand or on the person.” See EN 85.13. The products at issue in this protest properly classified “portable electric lamps” under heading 8513, HTSUS. Specifically, they are classified under subheading 8513.10.40, which provides in pertinent part for “Portable electric lamps designed to function by their own source of energy …: Lamps: Other”.
Heading 8543, HTSUS, provides in pertinent part for “Electrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter …”. Insofar as the instant products are properly classified under heading 8513, HTSUS, they cannot also be classified under heading 8543, HTSUS, by the terms of the heading. See GRI 1.
HOLDING:
By application of GRI 1, the Coleman LED Lamps, specifically the “Exponent Headlamp” (Model No. 4347-703) and the “Pack-Away Lantern” (Model No. 2000001870), which are the subject of protest number 4501-10-100037, are classified in heading 8513, HTSUS, specifically under subheading 8513.10.40, HTSUS, which provides for: “Portable electric lamps designed to function by their own source of energy (for example, dry batteries, storage batteries, magnetos), other than lighting equipment of heading 8512; parts thereof: Lamps: Other”. The column one, general rate of duty is 3.5% ad valorem. You are instructed to DENY the protest in full.
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 in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision Regulations and Rulings of the Office of International Trade will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division