HQ H012549

April 14, 2008

CLA-2 OT:RR:CTF:TCM H012549 KSH

CATEGORY: Classification

TARIFF NO.: 8517.50.5000

Area Port Director

U.S. Customs and Border Protection

605 W. 4^th^ Avenue

Suite 230

Anchorage, AK 99501

RE: Application for Further Review of Protest No. 3195-07-100160

Dear Area Director:\
\
This is in reply to your correspondence, forwarding the Application for
Further Review of Protest (AFR) No. 3195-07-100160, filed on behalf of
Xponent Phonetics, Inc. The protest is against Customs and Border
Protection's (CBP) classification and liquidation of forty-six entries
of diplexers and triplexers under heading 9013 of the Harmonized Tariff
Schedule of the United States (HTSUS).

Between January 4, 2006 and September 25, 2006, protestant entered the
merchandise subject to this protest under subheading 8542.70.0000,
HTSUS, which provides for: "Electronic integrated circuits and
microassemblies; parts thereof: Electronic microassemblies." The
merchandise was liquidated between October 27, 2006 and November 13,
2006, in subheading 9013.80.9000, HTSUS, which provides for: "Liquid
crystal devices not constituting articles provided for more specifically
in other headings; lasers, other than laser diodes; other optical
appliances and instruments, not specified or included elsewhere in this
chapter; parts and accessories thereof: Other devices, appliances and
instruments: Other."

> On October 3, 2006, CBP issued a Notice of Action giving notice of a
> rate

advance and reclassifying the merchandise under subheading 9013.80.9000,
HTSUS. On April 23, 2007, protestant filed a protest and application for
further review against the classification and liquidation of the
merchandise in subheading 9013.80.9000, HTSUS. Protestant's AFR request
was approved. The protest was timely filed pursuant to 19 U.S.C. 1514
(c)(3) and 19 C.F.R. 174.12 (e)(1). Protestant claims the merchandise is
classified in subheading 8517.50.5000, HTSUS, which provides for:

"Electrical apparatus for line telephony or line telegraphy, including
line telephone sets with cordless handsets and telecommunication
apparatus for carrier-current line systems or for digital line systems;
videophones; parts thereof: Other apparatus, for carrier-current line
systems or for digital line systems: Other: Telephonic."

In support of protestant's application for further review, protestant
alleges that the protest involves questions of fact and law, which have
not been ruled upon by CBP or by the courts and that the decision is
inconsistent with a decision by the port with respect to substantially
similar merchandise. See 19 C.F.R. 174.24(a) and (b). Specifically,
protestant cites to notification issued to protestant on December 6,
2005, accepting protestant's prior disclosure reclassifying protestant's
triplexer in heading 8517, HTSUS. Further review is warranted pursuant
to 19 C.F.R. §§174.24(a) and 174.25.

FACTS:

The merchandise at issue are diplexers and triplexers utilized solely in
telecommunications systems. The diplexers are opto-electric converters
that can transmit and receive different wavelengths simultaneously. They
can convert electrical signals to optical signals so they can be
transmitted optically at nominally 1310nm and receive optical signals at
1490nm and convert these to electrical signals which are then amplified
using a Tans-Impedence Amplifier Integrated Circuit Chip (TIA IC) so
they can be transported over electrical traces on a printed circuit
board. The diplexer integrates a semiconductor laser, photodiodes,
thin-film filters, TIA IC chip and fiber on a single printed circuit.

The triplexers are substantially similar to the diplexers in design and
use. However, they also have the ability to receive a third wavelength
at 1550 nm.

ISSUE:

Whether the diplexers and triplexers are classified in heading 8517,
HTSUS, as telecommunication apparatus for digital line systems or in
heading 9013, HTSUS, as other optical appliances and instruments.

LAW AND ANALYSIS:

Classification under the HTSUS is made in accordance with the General
Rules of Interpretation (GRI). GRI 1 provides, in part, that
classification decisions are to be \"determined according to the terms
of the headings and any relative section or chapter notes.\" In the
event that goods cannot be classified solely on the basis of GRI 1, and
if the headings and legal notes do not otherwise require, the remaining
GRI may then be applied, in order.

The Harmonized Commodity Description and Coding System Explanatory Notes
(EN) constitute the official interpretation of the Harmonized System at
the international level (for the 4 digit headings and the 6 digit
subheadings) and facilitate classification under the HTSUSA by offering
guidance in understanding the scope of the headings and GRI. While
neither legally binding nor dispositive of classification issues, the EN
provide commentary on the scope of each heading of the HTSUSA and are
generally indicative of the proper interpretation of the headings. See
T.D. 89-80, 54 Fed. Reg. 35127-28 (Aug. 23, 1989).

The headings under consideration are as follows:

8517. Electrical apparatus for line telephony or line telegraphy,
      including line telephone sets with cordless handsets and
      telecommunication apparatus for carrier-current line systems or
      for digital line systems; videophones; parts thereof:

> 8517.50 Other apparatus, for carrier-current line systems or for
> digital line systems:
>
> Other:

50. Telephonic

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9013. Liquid crystal devices not constituting articles provided for more
      specifically in other headings; lasers, other than laser diodes;
      other optical appliances and instruments, not specified or
      included elsewhere in this chapter; parts and accessories thereof:

> 9013.80 Other devices, appliances and instruments:
>
> 9013.80.90 Other

The ENs for heading 85.17 provide, in pertinent part, as follows:

(III) APPARATUS FOR CARRIER-CURRENT LINE SYSTEMS OR FOR DIGITAL LINE
      SYSTEMS

> These systems are based on the modulation of... a light beam by...
> digital signals. .... These systems are used for the transmission of
> all kinds of information (words, data, images, etc.)
>
> These systems include all categories of multiplexers and related line
> equipment for metal or optical-fibre cables. "Line-equipment" includes
> transmitters and receivers or electro-optical converters.

Section XVI, note 1(m), HTSUS, provides, in pertinent part, as follows:

1.  This section does not cover:

> ...
>
> \(m\) Articles of chapter 90;

The diplexers and triplexers are apparatus used solely in
telecommunication digital line systems. The diplexers and triplexers are
opto-electric converters that transmit and receive different
wavelengths. As such, the merchandise before us fits within the terms of
the heading of 8517, HTSUS. The ENs to 85.17 support this finding.

The diplexers and triplexers presently before us function in the same
manner as merchandise previously ruled by CBP to be classified in
heading 8517, HTSUS. See HQ 966888, dated May 10, 2004; NY R02506, dated
September 8, 2005; NY R0402, dated June 8, 2006; R03275, dated March 15,
2006 and; R03287, dated March 16, 2006.

The instant diplexers and triplexers are not classified in chapter 90,
as they are solely used in telecommunication digital line system, and
contain other equipment as noted above. Thus, at GRI 1, the diplexers
and triplexers are specifically provided for in heading 8517, HTSUS.
Section XVI, note 1(m), which excludes goods of chapter 90, does not
operate in this instance. See HQ 965367, dated September 26, 2002.

HOLDING:

In accordance with GRI 1, the diplexers and triplexers are classified in
heading 8517, HTSUS. They are provided for in subheading 8517.50.5000,
HTSUS, which provides for: "Electrical apparatus for line telephony or
line telegraphy, including line telephone sets with cordless handsets
and telecommunication apparatus for carrier-current line systems or for
digital line systems; videophones; parts thereof: Other apparatus, for
carrier-current line systems or for digital line systems: Other:
Telephonic." The 2006 column one, general rate of duty is Free.

Protest number 3195-07-100160 is granted in full. In accordance with
Sections IV and VI of the CBP [Protest/Petition Processing
Handbook]{.underline} (HB 3500-08A, December 2007, pp. 24 and 26), you
are to mail this decision, together with the CBP Form 19, to the
protestant no later than 60 days from the date of this letter.  Any
reliquidation of the

entry in accordance with the decision must be accomplished prior to
mailing the decision. Sixty days from the date of the decision
Regulations and Rulings of the Office of International Trade will make
the decision available to CBP personnel, and to the

public on the CBP Home Page on the World Wide Web at www.cbp.gov, by
means of the Freedom of Information Act, and other methods of public
distribution.

> Sincerely,
>
> Myles B. Harmon, Director
>
> Commercial and Trade Facilitation Division