Digital Processing Units; Keyboards; Monitors; Mouse; Automatic Data Processing Machine; ADP; Personal Computer; 100% Duty Sanction

HQ 089317 September 4, 1991 CLA-2 CO:R:C:M 089317 CMS CATEGORY: Classification TARIFF NO.: 8471.91.00, 8471.92.20 8471.92.40, 8471.92.90 9903.41.25 Mr. Tomy Shirai, Manager Unistar Air Cargo 146 Red Schoolhouse Rd. Spring Valley, NY 10977 RE: Digital Processing Units; Keyboards; Monitors; Mouse; Automatic Data Processing Machine; ADP; Personal Computer; 100% Duty Sanction Dear Mr. Shirai: Your request on behalf of Sega Of America, Inc., dated February 11, 1991, for a classification ruling on certain personal computer products has been referred by the Regional Commissioner of Customs, New York to Customs Headquarters for a reply. FACTS: The merchandise consists of three models of Sega personal computers, one model of CRT monitors and one model of input mouse. The three models of personal computers consist of keyboards and table or desk top digital processing units having a 16 bit microprocessor and main memory of 512KB to 2.5MB. The CRT monitor and input mouse are imported separately from the digital processing unit. The goods under consideration are products of Japan. ISSUE: Are the digital processing unit and keyboard subject to the 100% duty rate provided in subheading 9903.41.25, Harmonized Tariff Schedule of the United States Annotated (HTSUSA)? -2- LAW AND ANALYSIS: The HTSUSA provides that the classification of articles is governed by the General Rules of Interpretation (GRI's). 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...". Heading 8471 in pertinent part describes automatic data processing machines and units thereof. The merchandise is described by Heading 8471. The digital processing units of the three models of personal computers meet the description of automatic data processing (ADP) machines provided in Chapter 84 Note 5(A). The digital processing units are described by subheading 8471.91.00, HTSUSA, which in pertinent part provides for digital processing units. The keyboard component of the personal computers is described by subheading 8471.92.20, which in pertinent part provides for keyboards, whether or not entered with the rest of the system (e.g., with digital processing units). The CRT monitors are described as display units in subheading 8471.92.40, HTSUSA. The mice are described as other input units in subheading 8471.92.90, HTSUSA. Subheading 9903.41.25, HTSUSA, in pertinent part describes desk or tabletop ADP machines from Japan, of the type having separately housed constituent units, having at least 16 bit microprocessors and "...a microprocessor-based calculating mechanism capable of directly handling memory of not over 8 megabits (provided for in subheading 8471.91)". The digital processing units of the personal computers under consideration are capable of directly handling a maximum of only 2.5 megabits of memory, and the units are described by subheading 9903.41.25, HTSUSA. However, Chapter 99, Subchapter III U.S. Note 5 provides in pertinent part that subheading 9903.41.25, which provides for a 100% rate of duty, is currently suspended pursuant to executive action. The keyboards, even when entered with the digital processing units, are not described by subheading 9903.41.25, HTSUSA. The clear language of the article description of subheading 9903.41.25 provides for those machines which are "...provided for in subheading 8471.91". The keyboards, even when entered with the digital processing units, are not provided for in subheading 8471.91, and are not described by subheading 9903.41.25, HTSUSA. Likewise, the CRT monitor and mouse are not described by subheading 9903.41.25, HTSUSA. -3- HOLDING: The digital processing units of the three models of personal computers are classified in subheading 8471.91.00, HTSUSA, which currently provides a Column 1 rate of duty of 3.9%. These units are described by subheading 9903.41.25, HTSUSA, but are not currently subject to the 100% rate of duty due to the provision being suspended by executive action. The keyboard is classified in subheading 8471.92.20, HTSUSA, and is currently subject to a Column 1 duty rate of 0%. The CRT monitor is classified in subheading 8471.92.40, HTSUSA, and is currently subject to a Column 1 duty rate of 3.7%. The mouse is classified in subheading 8471.92.90, HTSUSA, and is currently subject to a Column 1 duty rate of 3.7%. Neither the keyboard, CRT monitor nor mouse are described by the article description for subheading 9903.41.25, HTSUSA, and these articles are not subject to any duty rates which may be provided by subheading 9903.41.25, HTSUSA. Sincerely, John Durant, Director Commercial Rulings Division