OT:RR:CTF:TCM H234000 TPB
Center Director
Customs and Border Protection
Electronics Center of Excellence and Expertise
301 E. Ocean Blvd.
Long Beach, CA 90802
Attn: Muhammad Waqas, Import Specialist
RE: Application for Further Review of Protest No. 2720-11-100572; Classification of
printed circuit board assemblies from Thailand
Dear Center Director:
This is in reference to the Application for Further Review (“AFR”) of Protest No.
2720-11-100572, timely filed on December 12, 2011, by Thales Avionics, Inc.
(“Thales”). The AFR concerns the classification of printed circuit board assemblies
(“PCBAs”) from the Kingdom of Thailand under the Harmonized Tariff Schedule of the
United States (HTSUS).
FACTS:
The merchandise at issue consists of PCBAs designed to perform specific
functions as component pieces of passenger aircraft in-flight entertainment systems.
Thales custom engineers the PCBAs for use in the Line Release Units (“LRUs”) of the
entertainment systems, and after importation, Thales installs the PCBAs into the LRUs
at a domestic facility. The PCBAs are used solely for the operation of in-flight
entertainment systems, and they are not suitable for use in other machines.
The protest at issue involves six entries of PCBAs, entered by Thales at the
Service Port of Los Angeles International Airport between July 27, 2010 and September
28, 2010. Specifically, Thales challenges U.S. Customs and Border Protection’s (CBP)
tariff classification and liquidation of the PCBAs in headings 8537 or 8538, HTSUS,
which respectively provide for “Boards, panels, consoles, desks, cabinets and other
bases, equipped with two or more apparatus of heading 8535 or 8536, for electric
control or the distribution of electricity, including those incorporating instruments or
apparatus of chapter 90, and numerical control apparatus, other than switching
apparatus of heading 8517” and “Parts suitable for use solely or principally with the
apparatus of heading 8535, 8536 or 8537.”
Thales filed its protest on December 2, 2011, and asserts that the correct
classification for the PCBAs is under subheading 8517.70.00 1, HTSUS, which provides
for “Telephone sets, including telephones for cellular networks or for other wireless
networks; other apparatus for the transmission or reception of voice, images or other
data, including apparatus for communication in a wired or wireless network (such as a
local or wide area network), other than transmission or reception apparatus of heading
8443, 8525, 8527 or 8528; parts thereof: Parts.” In denying the protest, the Port stated
that documentation provided by Thales did not substantiate its claims for all part
numbers subject to this protest.
ISSUE:
Whether the PCBAs are classified in heading 8517, HTSUS, as parts of other
apparatus for the transmission or reception of voice, images or other data; heading
8537, HTSUS, as boards, panels, consoles, desks, cabinets and other bases, equipped
with two or more apparatus of heading 8535 or 8536, for electric control or the
distribution of electricity; or heading 8538, HTSUS, as parts suitable for use solely or
principally with the apparatus of heading 8535, 8536, or 8537?
LAW AND ANALYSIS:
Initially, we note that the matter protested is protestable under 19 U.S.C. §
1514(a)(2) as a decision on classification. The protest was timely filed, within 180 days
of liquidation for entries made on or after July 27, 2010, and liquidated on or after June
10, 2011.
Further Review of Protest No. 2720-11-100572 is properly accorded to
Protestant pursuant to 19 C.F.R. § 174.24(b) because the decision against which the
1 In January 2017, subheading 8517.70 was amended to include two additional six-digit subheadings:
- Parts:
8517.71 -- Aerials and aerial reflectors of all kinds; parts suitable for use therewith
8517.79 -- Other
The current provision under consideration is subheading 8517.79.00, HTSUS, which provides for
“Telephone sets, including telephones for cellular networks or for other wireless networks; other
apparatus for the transmission or reception of voice, images or other data, including apparatus for
communication in a wired or wireless network (such as a local or wide area network), other than
transmission or reception apparatus of heading 8443, 8525, 8527 or 8528; parts thereof: Parts: Other.”
protest was filed is alleged to involve questions of law or fact which have not been ruled
upon by the Commissioner of CBP or his designee or by the Customs courts.
Merchandise imported into the United States is classified under the HTSUS.
Tariff classification is governed by the principles set forth in the General Rules of
Interpretation (GRIs) and, in the absence of special language or context which requires
otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional
U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory
provision of law for all purposes. GRI 1 requires that classification be determined first
according to the terms of the headings of the tariff schedule and any relative section or
chapter notes and, unless otherwise required, according to the remaining GRIs taken in
their appropriate order.
The Harmonized Commodity Description and Coding System Explanatory Notes
(ENs) constitute the official interpretation of the Harmonized System at the international
level. While not legally binding, the ENs provide a commentary on the scope of each
heading of the HTS and are thus useful in ascertaining the proper classification of
merchandise. It is CBP’s practice to follow, whenever possible the terms of the ENs
when interpreting the HTSUS. See T.D. 89-90, 54 Fed. Reg. 35127, 35128 (August 23,
1989).
The HTSUS headings under consideration are the following:
8517 Telephone sets, including telephones for cellular networks or for other wireless
networks; other apparatus for the transmission or reception of voice, images or
other data, including apparatus for communication in a wired or wireless network
(such as a local or wide area network), other than transmission or reception
apparatus of heading 8443, 8525, 8527 or 8528; parts thereof:
8537 Boards, panels, consoles, desks, cabinets and other bases, equipped with two or
more apparatus of heading 8535 or 8536, for electric control or the distribution of
electricity, including those incorporating instruments or apparatus of chapter 90,
and numerical control apparatus, other than switching apparatus of heading 8517:
8538 Parts suitable for use solely or principally with the apparatus of heading 8535, 8536
or 8537:
* * * * *
Note 2 to Section XVI states, in pertinent part, the following:
2. Subject to note 1 to this section, note 1 to chapter 84, and to note 1 to chapter 85,
parts of machines (not being parts of the articles of heading 8484, 8544, 8545,
8546 or 8547) are to be classified according to the following rules:
(a) Parts which are goods included in any of the headings of chapter 84 or 85
(other than headings 8409, 8431, 8448, 8466, 8473, 8487, 8503, 8522, 8529,
8538 and 8548) are in all cases to be classified in their respective headings;
(b) Other parts, if suitable for use solely or principally with a particular kind of
machine, or with a number of machines of the same heading (including a
machine of heading 8479 or 8543) are to be classified with the machines of
that kind or in heading 8409, 8431, 8448, 8466, 8473, 8503, 8522, 8529 or
8538 as appropriate. However, parts which are equally suitable for use
principally with the goods of headings 8517 and 8525 to 8528 are to be
classified in heading 8517….
Thales’ in-flight entertainment systems are composed of a number of common
components, including the PCBAs at issue in this ruling, and are suitable for installation
and use in different models of aircraft. Though the exact functions of a Thales in-flight
entertainment system may vary depending on the type of aircraft in which it is installed,
the system capabilities may include in-seat audio, overhead video, in-seat on-demand
entertainment, and in-seat Internet connectivity. Similarly, other Thales’ in-flight
entertainment systems also allow for in-seat messaging, information services, real-time
currency and credit card transactions, and broadband Internet services. As such, there
is no dispute that the in-flight entertainment systems are designed for the transmission
and reception of voice, images, and other data.
In NY N027030, dated May 29, 2008, CBP classified PCBAs used in wavelength-
division multiplexing (WDM) optical networking machines under subheading
8517.70.00, HTSUS, as parts of apparatus for the transmission or reception of voice,
images, or other data. There, CBP noted that the PCBAs were specifically designed for
installation and operation in networking machines connected to telecommunications
networks via optical line technology. Similar to the instant merchandise, the PCBAs at
issue in NY N027030 were installed in component machinery of the telecommunications
network.
As substantiated by technical drawings provided by Thales, the instant PCBAs
are designed and manufactured to Thales’ specifications to perform discrete functions
within their in-flight entertainment systems and are not suitable for use with other
electronic machines or merely for the control or distribution of electricity. After
importation, the PCBAs are installed in LRUs, which are incorporated into the
entertainment systems and are essential to their operation and function. Consequently,
we find that the PCBAs are specifically designed for sole use in Thales in-flight
entertainment systems and are substantially similar to the merchandise at issue in NY
N027030. Insomuch as Thales’ PCBAs are suitable for use solely or principally with
passenger aircraft in-flight entertainment systems capable of transmitting or receiving
voice, images, or other data, they are classified in heading 8517, HTSUS, pursuant to
Note 2(b) to Section XVI.
HOLDING:
By application of GRIs 1 (Note 2(b) to Section XVI) and 6, Thales’ PCBAs are
classified in heading 8517, HTSUS. Specifically, they are classifiable in subheading
8517.70.00, HTSUS (2010), which provides for “Telephone sets, including telephones
for cellular networks or for other wireless networks; other apparatus for the transmission
or reception of voice, images or other data, including apparatus for communication in a
wired or wireless network (such as a local or wide area network), other than
transmission or reception apparatus of heading 8443, 8525, 8527 or 8528; parts
thereof: Parts….” 2 The column one, general rate of duty is free.
You are instructed to GRANT the protest.
Duty rates are provided for your convenience and are subject to change. The text
of the most recent HTSUS and the accompanying duty rates are provided on World
Wide Web at https://hts.usitc.gov/current.
You are instructed to notify the protestant of this decision no later than 60 days
from the date of this decision. Any reliquidation of the entry or entries in accordance
with the decision must be accomplished prior to this notification. Sixty days from the
date of the decision, the Office of Trade, Regulations and Rulings will make the decision
available to CBP personnel and the public on the Customs Rulings Online Search
System (CROSS) at https://rulings.cbp.gov/, or other methods of public distribution.
Sincerely,
for Yuliya A. Gulis, Director
Commercial and Trade Facilitation Division
2 As noted above, subheading 8517.70 was further subdivided as of January 2017. Given that the subject
merchandise does not fall under the scope of the provision for “aerials and aerial reflectors of all kinds;
parts suitable for use therewith,” it would be classified under subheading 8517.79.00 under the 2025
HTSUS.