HQ 957837: Combination Line and Cordless Handset Telephones; NY 867362modified; heading 8517; EN 85.17; EN 85.25; EN to GRI 3(b)

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

 

                            HQ 957837

                        September 6, 1995
                                                               


CLA-2 R:C:M  957837 LTO

CATEGORY:  Classification

TARIFF NO.:  8525.20.50

Mr. Richard Haroian
Sony Electronics Inc.
1 Sony Drive
Park Ridge, New Jersey 07656

RE:  Combination Line and Cordless Handset Telephones; NY 867362
modified;      heading 8517; EN 85.17; EN 85.25; EN to GRI 3(b)

Dear Mr. Haroian:

     This is in response to your letter of April 13, 1995,
requesting reconsideration of NY 867362, dated October 23, 1991,
concerning the classification of combination telephone sets under
the Harmonized Tariff Schedule of the United States (HTSUS). 
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C.
1625(c)(1)), as amended by section 623 of Title VI (Customs
Modernization) of the North American Free Trade Agreement
Implementation Act, Pub. L. No. 103-182, 107 Stat. 2057, 2186
(1993), notice of the proposed revocation of NY 867362 was
published on August 2, 1995, in the Customs Bulletin, Volume 29,
Number 31.
     
FACTS:

     The subject articles are the Sony SPP-320, Sony SPP-400 and
SPP-405 (incorrectly referred to as the SPP-4000 and SPP-4050)
Cordless Telephones, which are combination line and cordless
handset telephones.   The telephones include the following
features: dual battery pack system; 10 channel auto-scan; any key
talk; low battery indicator; 10 number speed dialing; 2-way
paging/intercom; noise reduction system; out-of-range alert; on-hook dialing; temporary memory; wall-mountable base.

ISSUE:

     Whether the combination line and cordless handset telephones
are classifiable                               - 2 -

as electrical apparatus for line telephony under heading 8517,
HTSUS, or as transmission apparatus for radiotelephony, whether
or not incorporating reception apparatus or sound recording or
reproducing apparatus, under heading 8525, 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 "for legal purposes,
classification shall be determined according to the terms of the
headings and any relative section or chapter notes . . . ."

     The Harmonized Commodity Description and Coding System
Explanatory Notes (ENs) constitute the official interpretation of
the Harmonized System.  While not legally binding, and therefore
not dispositive, the ENs provide a commentary on the scope of
each heading of the Harmonized System, and are generally
indicative of the proper interpretation of these headings.  See
T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).

     The headings under consideration are as follows:

     8517 Electrical apparatus for line telephony or telegraphy,
including
          such apparatus for carrier-current line systems . . . 

     8525 Transmission apparatus for radiotelephony,
radiotelegraphy, 
          radiobroadcasting or television, whether or not
incorporating
          reception apparatus or sound recording or reproducing 
          apparatus . . . 
     
     In NY 867362, dated October 23, 1991, the Sony SPP-320, a
predecessor to the SPP-400 and SPP-405, was held to be
classifiable under subheading 8517.10.00, HTSUS, which provides
for other telephone sets.  You contend that the SPP-320, SPP-400
and SPP-405 are classifiable, according to GRI 3, under
subheading 8525.20.50, HTSUS, which provides for cordless handset
telephones.

     The SPP-320, SPP-400 and SPP-405 are combination line and
cordless handset telephones.  EN 85.17, pg. 1361, states that
heading 8517, HTSUS, covers telephone sets "for making and
receiving calls from other apparatus in the network."  The note
further states that the sets consist of a transmitter, receiver,
bell or buzzer, switching device and dialing selector.  The SPP-320, SPP-400 and SPP-405 incorporate line telephone sets, and are
therefore prima facie classifiable under heading 8517, HTSUS.

                                   - 3 -

     EN 85.25, pg.  1374, states that heading 8525, HTSUS, covers
transmission apparatus for radiotelephony, which is used "for the
transmission of signals (representing speech, messages or still
pictures) by means of electro-magnetic waves which are
transmitted through the ether without any line connection."  The
note further states that this group includes "[p]ortable radio-telephones."  The SPP-320, SPP-400 and SPP-405 incorporate
cordless handset telephones, and are therefore prima facie
classifiable under heading 8525, HTSUS.

     As the SPP-320, SPP-400 and SPP-405 are prima facie
classifiable in more than one heading, it is necessary to resort
to GRI 3.  GRI 3(a) requires that the heading which provides the
most specific description shall be preferred to headings
providing a more general description.  However, when two or more
headings each refer to part only of the components contained in a
composite good, those headings are to be regarded as equally
specific in relation to those goods.  Headings 8517 and 8525,
HTSUS, each refer to part only of the components of the SPP-320,
SPP-400 and SPP-405. Accordingly, no heading provides a specific
description of the devices, and it is necessary to resort to GRI
3(b).

     GRI 3(b), HTSUS, provides that "composite goods consisting
of different materials or made up of different components, . . .
which cannot be classified by reference to 3(a), shall be
classified as if they consisted of the material or component
which gives them their essential character, insofar as this
criterion is applicable."  The submitted literature describes the
devices as cordless telephones incorporating a "base telephone
for added convenience."  You note that consumers purchase them
because of the cordless feature.  Moreover, the vast majority of
the value of these devices is attributable to the cordless
function (approximately 75 percent).  See EN to GRI 3(b), pg.5
(factors which determine essential character).  Accordingly, it
is our opinion that the cordless handset telephone provides the
SPP-320, SPP-400 and SPP-405 with their essential character. 
They are therefore classifiable under subheading 8525.20.50,
HTSUS.

HOLDING:

     The Sony SPP-320, SPP-400 and SPP-405 Cordless Telephone is
classifiable under subheading 8525.20.50, HTSUS, which provides
for cordless handset telephones.  The corresponding rate of duty
for articles of this subheading is 4.8% ad valorem. 

     In accordance with 19 U.S.C. 1625(c)(1), this ruling will
become effective 60 days after publication in the Customs
Bulletin.  Publication of rulings or decisions pursuant to 19
U.S.C. 1625(c)(1) does not constitute a change of practice or
position in accordance with section 177.10(c)(1), Customs
Regulations (19 CFR 177.10(c)(1)).
                              - 4 -

EFFECT ON OTHER RULINGS:

     NY  867362, dated October 23, 1991, is modified.

                                            Sincerely,



                                 John Durant, Director
                                            Commercial Rulings Division