WORLD TRADE  
ORGANIZATION  G/IT/26 
21 March 2006 
 (06-1280) 
Committee of Participants on the Expansion of Trade in 
Information Technology Products Original:   English 
 
 
 
CLASSIFICATION OF SET TOP BOXES 
 
Communication from the World Customs Organization (WCO)  
 
 
 The attached document contains the deliberations and decision of the World Customs Organization's Harmonized System Committee (HSC) on the classification of set top boxes, which 
were in response to the request by the Chairman of  the Committee of Participants on the Expansion of 
Trade in Information Technology Products dated 23 January 2004, seeking the HSC opinion on the 
classification of "set top boxes which have a comm unication function: a microprocessor-based device 
incorporating a modem for gaining access to the internet, and having a function of interactive 
information exchange".    The attached WCO HSC decision on the classification of set top boxes was taken at its 36
th 
Session held in September 2005. 
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  G/IT/26 
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  DECISIONS OF THE HARMONIZED SYSTEM COMMITTEE (O. Eng.) 
 
 1. One delegate began the discussions on this agenda item by recalling the reasons for the 
product being placed on the Committee’s Agenda.  The debate stemmed from the ITA discussions 
amongst customs experts in Geneva, as  to whether or not certain types of Set Top Boxes (STBs) could 
fall within the scope of subheadings 8525.10 or 8525.20.  During those discussions, it was also acknowledged that STBs could also fall within headi ng 85.28.  With respect to the product before the 
Committee, his delegation had doubts as to whether the product met the conditions of the text of 
heading 85.25.  In this context, he referred to the existence of an Integrated DTV set which is a digital 
television with a built-in digital decoder or DTV r eceiver (heading 85.28).  In his view, due to the 
evolution of technology, the presence of a tuner was not the only criteria which would bring a product 
within the scope of heading 85.28.  The digital d ecoder was replacing the tuner and, in his view, this 
placed the STB before the Committee in heading 85.28 .  The digital decoder was taking the incoming 
signal and converting that signal for display on a TV.  In response to certain views regarding the 
method of delivery to the STB of the incoming signa ls as a “package”, he re garded this as a data 
stream in a specific format destin ed for display on a TV.  The fact  that it was not ready for display 
when it arrived in the STB and had to be converted did not negate the fact that it was destined for 
display on the TV.  Consequently, the STB was an apparatus for the reception of television signals 
and was classified in heading 85.28.  
2. Several other delegations agreed with the classification of the STB before the Committee in 
heading 85.28, as a reception apparatus for television.  One of these delegates referred to the legal text 
of heading 85.28 “reception apparatus for television , whether or not incorporating radio-broadcast 
receivers or sound or video recording or reproduc ing apparatus …”.  He argued that a STB was a 
reception apparatus for television.  He further stated  that all receivers had a processing function.  He 
drew the attention of the Committee to the fact that neither the current legal text nor the Explanatory 
Notes required that the signal be readily useable or  readable by the television.  The manner in which 
the product at issue was used was a reception func tion and, while the method of receiving the signal 
and nature of the signal might change, the recepti on function remained constant.  Consequently, the 
apparatus should be classified in heading 85. 28, as a reception apparatus for television. 
 
3. Another delegate reminded the Committee that  this agenda item was one referred to the 
Committee by the WTO where, in that body, it was an outstanding issue with respect to the possible 
classification of set top boxes in subheading 8525.10 or 8525.20.  The WTO, therefore, had 
approached the Harmonized System Committee to ask it to examine whether subheading 8525.10 or 
8525.20 could also be possible classifications for set top boxes as provided in the WTO description, having already agreed that subheadings 8517. 50 and 8528.12 were possible classifications. 
 
4. He agreed with the Secretariat in paragraph 12 of Doc. NC0965E1a that the complete system 
was a functional unit within the meaning of Note 4 to Section XVI.  However, as to the comments made in paragraph 13 of the same document, he referred the Committee to the Explanatory Note to 
heading 85.25, Part (B), which stated that apparatu s for television “falls here whether the transmission 
is by electro-magnetic waves or by line".  In the op inion of his administration, an apparatus which did 
not receive a television signal, whether or not it was encoded or compressed, could not be classified 
under heading 85.28. 
 5. He referred to the description of the *** in Doc. NC0965E1a, particularly to paragraphs 2 to 
6 of Annex I, wherein it was stated that the pro duct received data from the Internet (non-television) 
and converted it to a signal that was displayable on  a television and transmitted that signal to the 
television.  He felt that this understanding of th e process was supported by the explanation of the ICC 
expert in paragraph 2 of Annex II to Doc. NC0965E1a  and by the information contained on page 3 of 
the same document, under Product Basics : Description.  G/IT/26 
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  6. He indicated that since no television signal w as being received, but a signal for a television 
was created in the STB and sent to a television for di splay, the STB was classified in heading 85.25, 
specifically subheading 8525.10.  7. After having heard some other administrations express the opinion that the STB was receiving 
a television signal, he stressed that a television sign al was very different from the data signals that 
were being received by the STB.  He drew the atte ntion of the Committee to paragraph 6 of Annex I 
to Doc. NC0965E1a and reminded the Committee that the *** allowed households to access 
Windows – media compatible music, video and photos from the Web and to content loaded in files on 
networked PCs on their televisions.  They could al so watch news, sports and entertainment video 
clips.  All of these were based on computer files on a network, and not television signals. 
 8. He also reminded the Committee that this interpretation was consistent with the decision of 
the Committee to classify a satellite television STB  under heading 85.28 in Classification Opinion 
8528.12/2.  In that case, the STB received an en coded television signal a nd decoded it to a signal 
viewable by a television.  Even though the signa l had to be decoded to be viewed, it was still a 
television signal before, and after it entered the set top satellite box. 
 9. He felt that to accept the previously expr essed views would greatly enlarge the scope of 
heading 85.28, as now any signal whether televisi on or data which was be ing received would go 
under that heading, rather than only televi sion signals, which was now the requirement. 
 
10. An alternative view was expressed by one de legate.  In his administration’s view, heading 
85.25 was excluded because the STB did not act as a receiver.  Heading 85.28 was also excluded 
because the STB was not a tuner.  It was connected  to the television only to use the television as a 
monitor.  In his administration’s view, the design characteristics and function of the STB was that of a 
modem.  Based on Note 4 to Section XVI and th e design characteristics and function of the STB, his 
administration would classify the STB befo re the Committee in subheading 8517.50. 
 11. The Deputy Director drew the attention of the Committee to the description in the box before 
paragraph 12 of Doc. NC0965E1a.  It was the Secretariat’s view that the STB, as such, did not provide a television signal; rather, it provided an audio-visual signal, which was not the same as a 
television signal.  It was for this reason that the Secretariat had questioned the classification of the 
STB in heading 85.25 in the working document.  He  made the analogy to connecting a DVD player to 
a television set through an audio-visual cable.  He wondered whether that would make the DVD 
player a transmission apparatus.  He further explai ned that the signals received by the STB were the 
same signals one received through a modem to connect  to the Internet.  Once connected, one can go to 
the Internet and download content by a data stream that could then be put on a computer through a 
modem.  The STB converts this signal that can th en be understood by a television.  Based on the 
foregoing, the Deputy Director felt that classification of the STB in heading 85.17 merited considerations.  12. When the Chairperson called for a vote, three delegates voted in favour of classification in 
heading 85.17, three delegates opted for classifi cation in heading 85.25 and twenty-two supported 
classification in heading 85.28.  13. At this point, the *** Delegate asked th e Committee how the Committee would respond the 
question posed to it by the WTO, as the ICC ha d provided to the Committee for classification a STB 
which could meet the definition of the ITA and wh ich could be classified either in subheadings 
8525.10 or 8525.20.   G/IT/26 
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  14. The Deputy Director responded by reading from the WTO letter, wherein the WTO had made 
its request to the HS Committee.  He was of the opinion that the product classified by the Committee 
met the requirements of the ITA description outlin ed in the request letter and that subheadings 
8525.10 and 8525.20 were both possible classificati ons.  He informed the Committee that the 
Secretariat would report the results of the Comm ittee’s discussions, as well as the classification of the 
product to the WTO shortly.  The Secretariat would make it clear that the two-month reservation 
period was still in effect and would end on 1 December 2005.  15. The Chairperson then suggested and receive d the Committee’s approval for classification in 
subheading 8528.12 by application of GIRs 1 and 6.  In order to give effect to this decision, the 
Committee instructed the Secretariat to prepare a dr aft Classification Opinion for examination, in the 
first instance, by the next presessional Working Party. 
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