Infrared Voice Communication System; Legal Note 4, Section XVI; EN 85.37; 067473; 087261

HQ 089223 August 5, 1991 CLA-2 CO:R:C:M 089223 KCC CATEGORY: Classification TARIFF NO.: 8537.10.00 Dr. Jack Lin Telestate International 101 E. Park Blvd., Suite 589 Plano, Texas 75074 RE: Infrared Voice Communication System; Legal Note 4, Section XVI; EN 85.37; 067473; 087261 Dear Dr. Lin: This is in response to your letter dated April 9, 1991, to the Assistant Area Director, New York Seaport, requesting a tariff classification ruling under the Harmonized Tariff Schedule of the United States (HTSUS) of the SmartCom 2001 System. Your letter was forwarded to this office for a reply. FACTS: The SmartCom 2001 System is a communications system that provides home security, a hands free infrared voice intercom, multi-line telephones with music on hold, a message center, a door intercom, emergency dialing, energy control and a management subsystem. The system consists of a control panel that handles all signaling and communications, a console that provides the user with centralized control, an intercom station for various rooms in the home, a door box, and a hand held remote control unit. The SmartCom 2001 System includes intercom, security, telephone, answering machine, energy control and management subsystem functions. It is also capable of being programmed to allow additional functions to be placed into the system. ISSUE: What is the classification of the SmartCom 2001 System under the HTSUS? LAW AND ANALYSIS: The General Rules of Interpretation (GRI's) to the HTSUS govern the classification of goods in the tariff schedule. GRI 1 states, in pertinent part, that: ...classification shall be determined according to the terms of the headings and any relative section or chapter notes.... Legal Note 4, Section XVI, states: Where a machine (including a combination of machines) consists of individual components (whether separate or interconnected by piping, by transmission devices, by electric cables or by other devices) intended to contribute together to a clearly defined function covered by one of the headings to chapter 84 or chapter 85, then the whole falls to be classified in the heading appropriate to that function. The SmartCom 2001 covers functions which are provided for in various headings of chapter 85 and 90 of the HTSUS. Heading 8537, HTSUS, provides for boards, panels and other bases equipped with two or more switches or fuses for electric control or the distribution of electricity. The Explanatory Notes (EN) to heading 8537, HTSUS, state that the devices found in this heading consist of an assembly of apparatus of headings 8535 or 8536, HTSUS, on a board, panel, console, etc., or mounted in a cabinet, desk, etc. The goods of this heading vary from small switchboards with only a few switches, fuses, etc. (e.g., for lighting installations) to complex control panels for machine tools, rolling mills, power stations, radio stations, etc., including several of the articles cited in the text of this heading. This heading also covers "'Programmable controllers' which are digital apparatus using a programmable memory for the storage of instructions for implementing specific functions such as logic, sequencing, timing, counting and arithmetic, to control, through digital or analog input/output modules, various types of machines." See, The Harmonized Commodity Description and Coding System Explanatory Notes (EN) 85.37, page 1391. The ENs constitute the Customs Cooperation Council's official interpretation of the Harmonized System. Although generally indicative of proper interpretation of the various provisions, they are not legally binding on the contracting parties. Thus, while they should be consulted for guidance, the ENs should not be treated as dispositive. Customs believes that the ENs should be consulted for interpretation of the Harmonized System. T.D. 89-90. The SmartCom 2001 System is a machine that consists of individual components interconnected through electric cables (home wiring system), intended to contribute to the defined function of electric control or the distribution of electricity. Therefore, this System is properly classified under subheading 8537.10.00, HTSUS, which provides for: " [b]oards, panels (including numerical control 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, other than switching apparatus of heading 8517: [f]or a voltage not exceeding 1,000 v." See, Headquarters Ruling Letter (HRL) 067473 dated July 16, 1982, and HRL 087261 dated January 17, 1991, for the classification of home control systems. HOLDING: The SmartCom 2001 System is classified under subheading 8537.10.00, HTSUS, which provides for: "[b]oards, panels (including numerical control 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, other than switching apparatus of heading 8517: [f]or a voltage not exceeding 1,000 v." The rate of duty is 5.3% ad valorem. Sincerely, John Durant, Director Commercial Rulings Division