CLA-2 OT:RR:CTF:EMAIN H325872 SKK
Jeffrey Richardson
Miller Canfield
840 West Long Lake Road, Suite 150 Troy, Michigan 48098 (USA)
RE: Ruling request concerning the tariff classification of an LCD module for motor vehicle applications; Decoder IC
Dear Mr. Richardson:
This is in response to your ruling request of May 20, 2022, on behalf of Tianma America, Inc. (Tianma), pertaining to the classification of an automotive display module under the Harmonized Tariff Schedule of the United States (HTSUS). In reaching the below determination, U.S. Customs and Border Protection (CBP) has considered the information presented with your ruling request, as well as the supplemental information provided by email on June 23, 2022, August 24, 2022, January 24, 2023, and February 1, 2023. No sample was provided for examination.
FACTS:
The merchandise under consideration is a liquid-crystal display (LCD) module, referenced Tianma part numbers TM110:XXKP03-00, TM110:XXKP04-00, TM110:XXKP07-00, and TMl10XXKP08-00. The display module measures 11-inches (27.94 centimeters) diagonally and features a 2000 x 810-pixel configuration. It does not incorporate a touchscreen. It does not contain video recording or reproducing apparatus or provide for television reception. The display module’s printed circuit board (PCB) subassembly contains a micro-controller unit, high-speed low voltage differential signaling (LVDS) deserializer integrated circuit (IC), decoder IC, light-emitting diode (LED) driver, voltage generators, and various resistors and capacitors that adhere to the bare board via surface-mount technology. The subject module is intended for automotive use as a driver or passenger display screen. At importation, software on the subject PCB subassembly is described as capable of accepting, processing/converting, and displaying only video signals and backlight dimming level values generated from an automotive engine control unit (ECU). Data from the ECU is transmitted through a highspeed serialized interface over coaxial cables/vehicle harness connected to the LVDS deserializer IC, which includes a decoder IC that converts the video data for display. The specific information to be displayed is determined after importation, when the module’s PCB subassembly is programmed by the vehicle Original Equipment Manufacturer (OEM).
ISSUE:
What is the proper tariff classification of the LCD modules under the HTSUS?
LAW AND ANALYSIS:
Classification under the HTSUS is in accordance with the General Rules of Interpretation (GRIs) and any applicable legal notes. 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. If goods cannot be classified solely on the basis of GRI 1, and if the heading and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied in order.
The HTSUS provisions under consideration in the instant case are as follows:
8524 Flat panel display modules, whether or not incorporating touch-sensitive screens.
8528 Monitors and projectors, not incorporating television reception apparatus;
reception apparatus for television, whether or not incorporating radio- broadcast receivers or sound or video recording or reproducing apparatus:
8531 Electric sound or visual signaling apparatus (for example, bells, sirens,
indicator panels, burglar or fire alarms), other than those of heading 8512 or
8530; parts thereof:
Note 7 to Chapter 85 provides:
For the purposes of heading 8524, “flat panel display modules” refer to devices or apparatus for the display of information equipped at a minimum with a display screen, which are designed to be incorporated into articles of other headings prior to use. Display screens for flat panel display modules include, but are not limited to, those which are flat, curved, flexible, foldable, or stretchable in form. Flat panel display modules may incorporate additional elements, including those necessary for receiving video signals and the allocation of those signals to pixels on the display. However, heading 8524 does not include display modules which are equipped with components for converting video signals (e.g., a scaler IC, decoder IC or application processer) or have otherwise assumed the character of goods of other headings.
For the classification of flat panel display modules defined in this Note, heading 8524 shall take precedence over any other heading in the tariff schedule.”
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the ENs 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 follow, 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 85.24 provides, in pertinent part:
This heading covers flat panel display modules, whether or not incorporating touch-sensitive screens, which are defined in Note 7 to this Chapter.
The articles of this heading are equipped at a minimum with a display screen utilizing liquid crystal display (LCD), organic light-emitting diodes (OLED), light-emitting diodes (LED) or other display technologies.
The screen types of flat panel display modules include, but are not limited to, those which are flat, curved, flexible, foldable, stretchable or rollable in form.
This heading includes:
* * * * *
(2) Flat panel display modules with drivers or control circuits: Drivers or control units are added to ‘cells’ of item (1). The modules may contain drivers that receive video signals or other data (e.g., text, images, ADP signals, or other graphical data) and switch individual pixels of displays (generally consisting of driver IC and PCB that connects video signals to driver IC) or control circuits of power supply for display modules or timing control. They might combine with backlight units (for LCDs) or frames (chassis).
* * * * *
The articles of this heading are designed to be attached to or incorporated in a wide range of apparatus (e.g., refrigerators, automatic data processing machines, mobile phones and devices for transmission or reception of images or data, digital cameras and video camera recorders, monitors and reception apparatus for television and motor vehicles for the transport of persons).
* * * * *
The heading excludes, inter alia:
(a) Flat panel display modules with video-converting components (usually articles of headings 85.17, 85.28 and 85.29).
(b) Visual signaling apparatus (indicator panel) incorporating flat panel display modules (heading 85.31).
* * * * *
EN 85.31 states, in relevant part:
This heading includes, inter alia:
* * * * *
(D) Indicator panels and the like. These are used (e.g., in offices, hotels, and factories) for calling personnel, indicating where a certain person or service is required, and indicating whether a room is free or not. They include:
Room indicators. These are large panels with numbers corresponding to a number of rooms.
Number indicators. The signals appear as illuminated figures on the face of a small box; in some apparatus of this kind the calling mechanism is operated by the dial of a telephone. Also, clock-type indicators in which the numbers are indicated by a hand moving around a dial.
Office indicators, for example, those used to indicate whether the occupant of a particular office is free or not.
Lift indicators. These indicate, on an illuminated board, where the lift is and whether it is going up or down.”
Note 7 to Chapter 85, supra, defines the scope of heading 8524, HTSUS, and prescribes the components a flat panel display module of this heading may contain. Note 7 specifically excludes flat panel display modules equipped with components for “converting video signals” (listing scaler ICs, decoder ICs, and application processers as exemplars thereof), as well as modules that have “otherwise assumed the character of goods of other headings.” Note 7 further specifies that if a flat panel display module is described by the terms of Note 7, classification under heading 8524, HTSUS, shall take precedence over any other heading.
The threshold determination is whether the subject flat panel display module satisfies the terms of Note 7 to Chapter 85. This determination requires a finding as to whether the subject display module incorporates a component that converts video signals or has otherwise assumed the character of goods of other headings. In your supplemental email submission, dated February 1, 2023, you clarify that the subject display module features a decoder IC within the deserializer component, which performs the specific function of decoding encoded video signals received by the deserializer from the motor vehicle in which the subject LCD module is designed to be installed. As such, in its condition as imported, the subject display module can receive, process and convert video signals for display. Based on the foregoing, the subject display module falls outside the scope of heading 8524, HTSUS, as per Note 7 to Chapter 85.
Heading 8531, HTSUS, provides for, in relevant part, “[E]lectric sound or visual signaling apparatus … other than those of heading 8512 or 8530.” Heading 8531, HTSUS, is a “principal use provision” subject to Additional U.S. Rule of Interpretation (AUSR) 1(a), which requires that the tariff classification “be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong….” In Optrex America Inc. v. United States, 427 F. Supp. 2d 1177, 1198 (Ct. Int’l Trade 2006), aff’d 475 F.3d 1367 (Fed. Cir. 2007), the court examined the classification of LCD segmented character modules with permanently etched icons capable of displaying no more than 80 characters and containing drive circuitry. The court determined the scope of heading 8531, HTSUS, was limited to simple LCDs, stating:
…to be classifiable as an indicator panel incorporating a liquid crystal device under subheading 8531.20.00, HTSUS, the articles must belong to the class or kind of merchandise that is principally used to display limited information that is easily understood by the person viewing it.
CBP has classified LCD modules that are limited by design and/or principal use to “signaling” in heading 8531, HTSUS. For example, in Headquarters Ruling Letter (HQ) H304224, dated December 3, 2020, CBP classified in heading 8531, HTSUS, a “Heads Up” automotive LCD display designed to provide limited, easily understood information ( i.e., speed, safety warnings, turn-by-turn directions, and audio settings) to the driver in a location that does not require the driver to avert their eyes from the road ahead (reflected onto the windshield of the vehicle by a concave mirror). Although the LCD did not have permanently etched icons or segment-style characters, the screen utilized similarly simplistic icons and numbers, always appearing in the same place on the screen, to convey information to the driver. In HQ H049555, dated April 13, 2009, CBP classified automotive LCD modules used as radio/message displays (to display time, velocity in miles per hour, climate control, compass, music controls, and Bluetooth connection status) in heading 8531, HTSUS. These LCD modules used segment-style characters and permanently etched icons to communicate limited information. CBP determined that these modules were operationally limited to performing signaling functions akin to those performed by the products listed in the ENs to 85.31. In NY N306705, dated October 31, 2019, CBP classified LCD indicator panels for automobiles in heading 8531, HTSUS. The panels used
both segment style characters and fixed icons to indicate fuel status, driving distance, time, audio output, external temperature and revolutions per minute (RPM). In HQ H026661, dated July 8, 2008, CBP classified an LCD display for auto/marine/industrial applications in heading 8531, HTSUS. The LCD displays could be programmed to display limited information such as RPM, temperature, speed and fuel tank level.
The subject LCD display modules, in their condition as imported, are capable of displaying a wide variety of video, including video from the automobile’s parking assist camera, maps, GPS, radio, vehicle system information, and any video signal specified by the OEM. You indicate that different OEMs can request that the subject display modules be placed in different sections of a vehicle (e.g., back seat), which would influence the type of video to be displayed. At the time of import, there are no inherent limitations incorporated into these modules as to the type of video they can display as this will be determined by OEM programming. As such, the subject panels are not of the class of goods normally limited to providing only signaling/indication information and classification is not proper under heading 8531, HTSUS.
We next examine whether the subject display module is classified under heading 8528, HTSUS. The U.S. Court of International Trade defined a monitor of heading 8528, HTSUS, as a machine that receives data from an external source, and then processes and converts that data into physical output commands to display an image. See Prysm, Inc. v. United States, No. 18-00151 (Ct. of Int’l Trade, December 26, 2019). In their condition as imported, the subject display modules receive video data values from the OEM (external source) through a high-speed serialized interface over coaxial cables/vehicle harness connected to the LVDS deserializer IC, which contains a decoder IC that processes and converts the video data for display. As such, the subject display modules are advanced so as to fall within the scope of heading 8528, specifically subheading 8528.59.25, HTSUSA, which provides for “[M]onitors and projectors, not incorporating television reception apparatus; reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus: Other monitors: Other: Color: With a flat panel screen: Other: With a video display diagonal not exceeding 34.29 cm.”
HOLDING:
By application of GRIs 1 and 6, the subject LCD display module is classified in heading 8528, specifically subheading 8528.59.25, HTSUS, which provides for “[M]onitors and projectors, not incorporating television reception apparatus; reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus: Other monitors: Other: Color: With a flat panel screen: Other.” The column one, general rate of duty is free.
Duty rates are provided for your convenience and subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the U.S. International Trade Commission’s website at www.usitc.gov/tata/hts. A copy of this ruling letter should be attached to entry documents filed at the time the goods are entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the CBP officer handling the transaction.
Sincerely,
Gregory Connor, Chief
Electronics, Machinery, Automotive,
and International Nomenclature Branch