The tariff classification of a mobile collaboration device (MCD) and client application software from Taiwan

NY M87074 October 13, 2006 CLA-2-85R:NC:MM 109 M87074 CATEGORY: Classification TARIFF NO.: 8517.50.9000 Ms. Joan Studeny GHY USA, Inc. Customs Brokers/Trade Consultants 572 South Fifth Street Pembina, ND 58271 RE: The tariff classification of a mobile collaboration device (MCD) and client application software from Taiwan Dear Ms. Studeny: In your letter dated September 27, 2006, you requested a tariff classification ruling on behalf of your client, LibreStream Technologies, Inc. of Winnipeg Manitoba, Canada. The merchandise subject to this ruling is a mobile collaboration device (MCD) and application software that is installed and runs on a personal computer (PC) in order to let the distant viewer to communicate with the MCD. The MCF is a multi-functional device. It captures and sends video images in real time and varying transfer rates (dependent on the speed of the telecommunications connection). It sends and receives audio form the user and the PC client equipment; it sends and receives data in the form of the drawing utility and the MCD remote controls; it communicates with WiFi telecom links through a build in 802.11 type radio device. The MCD system will allow workers who are at remote sites to jointly view, illustrate, and discuss technical issues on a real-time basis. The system is like a room based video conferencing system. However, the MCD is a hand-held device. The MCD is not a television broadcast device because it does not broadcast to a large population as a television broadcast device would. Therefore, this would not be classified as a television transmission device under Harmonized Tariff Schedule of the United States (HTSUS) subheading 8525.10.30. The MCD is imported with application software. Software is considered recorded media. Legal Note 6 to Chapter 85, Harmonized Tariff Schedule of the United States (HTSUS) states: “Records, tapes and other media of heading 8523 or 8524 remain classified in those headings when entered with the apparatus for which they are intended. This note does not apply to such media when they are entered with articles other than the apparatus for which they are intended. For the purposes of this note, the term “apparatus for which they are intended” refers to apparatus which reads or plays the media or which records or writes on the media.” As per your product description, the software (recorded media) is for installation on a personal computer in order to let a worker at a distant remote site to communicate with the MCD. Since the software is imported with the MCD, an item for which it is not intended, classification within headings 8523 or 8524 is not applicable. As such, Legal Note 6 to Chapter 85, Harmonized Tariff Schedule of the United States (HTSUS) is satisfied. The MCD coupled with the software makes this a set, with the essential character being the MCD, classifiable within heading 8517. The applicable subheading for mobile collaboration device (MCD) will be 8517.50.9000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Other apparatus, for carrier-current line systems or digital line systems: Other: Telegraphic: Other.” The rate of duty will be free. 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 http://www.usitc.gov/tata/hts/. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). Pursuant to title 19 United States Code, Section 3005 The Harmonized Tariff Schedule of the United States is expected to be amended effective 1/1/07. The amendments are expected to affect the classification of your merchandise. Pursuant to Section 3005 c, the report recommending those changes has been sent to the President for proclamation of the changes. Upon the expiration of sixty legislative days, in the absence of Congressional action, the recommended changes will become law. Accordingly based on that recommendation, it is anticipated that your merchandise will be classified in 8517.62.0080 under the 2007 Harmonized Tariff Schedule. Under the circumstances, this classification under the 2007 tariff is advisory only. A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Linda M. Hackett at 646-733-3015. Sincerely, Robert B. Swierupski Director, National Commodity Specialist Division