July 12, 2006 CBP Bulletin Notices on Electrode Steam Humidifiers and an Audio Visual Laptop

According to CBP, the revocation for the subject steam humidifiers is effective for merchandise entered or withdrawn from warehouse for consumption on or after September 10, 2006.

With respect to the audio visual laptop, CBP states that any party who has received an interpretive ruling or decision on subject merchandise, and/or any person involved in substantially identical transactions, should advise CBP by August 11, 2006, the date that written comments on the proposed ruling are due. Furthermore, CBP states that an importer's failure to advise CBP of such rulings, decisions, or substantially identical transactions may raise issues of reasonable care on the part of the importer or its agent for importations subsequent to the effective date of the final decision in this notice.

CBP also states that these notices cover any rulings on the subject merchandise that may exist but have not been specifically identified.

Proposed Revocation of One Classification Ruling

Audio visual laptop. The item at issue is the Toshiba audio video laptop personal computer denoted under the brand name of Qosmio. This laptop personal computer is equipped with an Intel Pentium M processor 735, 64MB Graphics, 512 MB memory, a 15" XGA screen, 80GB hard disk drive, fixed 2-spindle DVD drives, WiFi 802.11g, XP-MCE operating system and an integrated TV tuner. The device has two distinct independent functions; it can operate as a personal computer and as a television.

CBP is proposing to issue HQ 967655 in order to revoke NY K88339 to reflect the proper classification of audio visual laptops under HTS 8471.30.0000, which provides for portable digital automatic data processing (ADP) machines, weighing not more than 10 kg, consisting of at least a central processing unit, a keyboard and a display, rather than under HTS 8528.12.7201, which provides for other reception apparatus for television, whether or not incorporating radiobroadcast receivers or sound or video recording or reproducing apparatus, with a flat panel screen, etc.

Pursuant to Note 5(A) to HTS Chapter 84, CBP states that the subject laptop meets the terms of heading 8471 as an ADP machine; however, it is also capable of displaying a variety of TV signals and other audio visual information, which is provided for under heading 8528, as reception apparatus for television. Therefore, the subject laptop is considered a composite machine that has the functions of both an ADP machine and a reception apparatus for television.

As a composite machine, CBP states that it is to be classified as if consisting only of that component or as being that machine which performs the principal function.

According to CBP, probative evidence included in the petitioner's submission indicates that consumers are primarily purchasing the subject laptop for its ADP functions with ancillary interest in the audio visual functions. Furthermore, the laptop is marketed and sold in channels of trade for ADP machine, is sold in the ADP departments of consumer electronic retailers, and is advertised as such. In addition, evidence has been submitted indicating that the overwhelming majority of purchasers use the subject laptop for its data processing functions while few regularly use the laptop to watch television.

Based on the information above and certain other factors, CBP finds that the principal function of the laptop is an ADP machine of HTS heading 8471.

proposed: 8471.30.0000, duty-free; current: 8528.12.7201, 5%.

Revocation of One Classification Ruling

Electrode steam humidifiers. CBP states that the humidifiers at issue create steam which is used to add moisture (i.e., humidity) to the air that passes through a furnace. The steam is produced by means of hot water produced by an electric current generated between electrodes immersed in the water. One model of humidifier is imported with a blower unit and the other is not; however, both models are operated by microcomputer. The products' literature suggests design features and specifications for industrial applications.

CBP is issuing HQ 968027 in order to revoke HQ 958017 and reclassify the subject humidifiers under HTS 8516.10.0080, which provides for other water heaters and immersion heaters, rather than under HTS 8543.80.75 (1996) as other electrical machines and apparatus, having individual functions.

According to CBP, HQ 958017 discounted classification of the instant merchandise in HTS 8516 on the basis that the provision was limited to domestic-type appliances. However, CBP now believes that this is incorrect as the provision in HTS 8516 for electric instantaneous or storage water heaters and immersion heaters is not circumscribed by the requirement that they be for domestic purposes. CBP now believes that HTS 8516 provides for the two models of humidifiers at issue.

CBP explains that the HTS 85.16 Explanatory Notes (ENs) warrant the conclusion that the function of electrode boilers is to produce hot water with steam being a byproduct for the purpose of introducing moisture into the air (humidity), which eliminates HTS 8543 from consideration. Therefore, CBP finds that under the authority of General Rule of Interpretation (GRI) 1, the electrode steam humidifiers are provided for under HTS 8516.

new: 8516.10.0080, duty-free; previous: 8543.80.75 (1996) now 8543.89.96, 2.6%.

(See ITT's Online Archives or 05/23/06 news, 06052340, for BP summary of proposed HQ 968027.)

July 12, 2006 CBP Bulletin (Vol. 40, No. 29) available at http://www.cbp.gov/xp/cgov/toolbox/legal/bulletins_decisions/bulletins_2006/vol40_07122006_no29/