H310654

HQ H310654 May 18, 2021 CLA-2 OT:RR:CTF:TCM H310654 TPB CATEGORY: Classification TARIFF NO.: 8543.70.99 Center Director, Electronics Center of Excellence and Expertise U.S. Customs and Border Protection Los Angeles Service Port 301 E. Ocean Blvd. Long Beach, CA 90802 ATTN: Elizabeth Carrick, Import Specialist RE: Application for Further Review of Protest No. 4197-18-100843; Classification of certain biometric devices Dear Center Director: This is in response to the Application for Further Review (“AFR”) of Protest 4197-18-100843, dated June 29, 2018, filed on behalf of ZK Technology LLC. (“ZKTeco”/“Protestant”), in response to your classification of certain biometric controllers under the Harmonized Tariff Schedule of the United States (“HTSUS”). The articles were entered March 9, 2017, and liquidated February 16, 2018. FACTS: According to the submission, the names of the products imported by Protestant vary depending on the product type. The items are the interface for the customers of Protestant’s clients, who develop systems that capture various types of data from their actual end-users. The captured data could be whatever clients deem necessary to provide the functionality their system offers, based on the market niche, application, or other parameters determined during product review and deployment. The products are used to verify the identity of a person using biometrics (such as fingerprint or facial recognition); end-user card swipes using a built-in card reader; or capturing data that end-users enter or input into the device. The collected data is sent to the client's host application, which provides integration and communication from the data collection device to their system. Protestant indicates that each device has an operating system like Unix, Android, or Windows. Protestant’s software client can write its own application for the device to communicate with their specific software, which is either located to their end-user customers' locations or hosted in the Cloud. Protestant’s submission indicates that the biometric readers are composed of the following components: plastic enclosures LCDs printed circuit assemblies an embedded microprocessor memory other components required to create the product functionality required based on the internal design specification connectors for attaching external wiring, such as Ethernet cables, USB devices, etc. verification reader (like biometric and/or proximity and/or barcode and/or magnetic). a keypad, LCD screen with and without touch screen, depending on the model. ISSUE: Whether the entries in question are classified under heading 9106, HTSUS, as “Time of day recording apparatus and apparatus for measuring, recording or otherwise indicating intervals of time, with clock or watch movement or with synchronous motor…” ; heading 8471, HTSUS, as “Automatic data processing machines and units thereof…”, or heading 8543, HTSUS, as “Electrical machines and apparatus, having individual functions, not specified or included elsewhere…”. LAW AND ANALYSIS: Initially, we note that the matters protested are protestable under 19 U.S.C. §1514(a)(2) as decisions on classification. The protest was timely filed, within 180 days of liquidation of the first entry. (Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2) (B) (ii), (iii) (codified as amended at 19 U.S.C. § 1514(c) (3) (2006)). Further Review of Protest No. 4197-18-100843 is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(b) because the decision against which the protest was filed is alleged to involve questions of law or fact, which have not been ruled upon by the Commissioner of Customs or his designee, or by the courts. Classification under the HTSUS is determined in accordance with the General Rules of Interpretation (“GRIs”). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied in order. In addition, in interpreting the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See T.D. 89 80, 54 Fed. Reg. 35127 (August 23, 1989). The HTSUS provisions at issue are as follows: 8471 Automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data, not elsewhere specified or included: * * * 8543 Electrical machines and apparatus, having individual functions, not specified or included elsewhere in [Chapter 85]; parts thereof: * * * 9106 Time of day recording apparatus and apparatus for measuring, recording or otherwise indicating intervals of time, with clock or watch movement or with synchronous motor (for example, time-registers, time-recorders): Note 1(n) to Section XVI, HTSUS, which includes Chapter 84, specifies that the section does not cover “clocks, watches, or other articles of Chapter 91”. As such, the first question is whether the instant merchandise is prima facie classifiable as a fingerprint, time and attendance devices of heading 9106, HTSUS. The EN to heading 9106 states, in pertinent part, that: Provided they are operated by a movement of the watch or clock type (including secondary or synchronous motor clock movements) or by a synchronous motor with or without reduction gear, this heading covers: A wide range of apparatus for recording the time of day at which some action or operation is effected; and Apparatus, not elsewhere specified, for measuring, recording or otherwise indicating intervals of time. After examining the entries, we agree with Protestant’s claim that the products under consideration do not meet the legal text requirements in order to be classified under heading 9106. Consequentially, that heading is removed from consideration. Protestant claims that the entries are classified under heading 8471, HTSUS, specifically, subheading 8471.60.10, HTSUS, as other input/output units of automatic data processing machines (ADP). Units of ADP machines are described in Note 5 (C) to Chapter 84, HTSUS, as follows: Subject to paragraphs (D) and (E) below, a unit is to be regarded as being part of an automatic data processing system if it meets all of the following conditions: i. It is of a kind solely or principally used in an automatic data processing system; ii. It is connectable to the central processing unit either directly or through one or more other units; and iii. It is able to accept or deliver data in a form (codes or signals) which can be used by the system. In reaching the conclusion that the goods are classified under subheading 8471.60.10, HTSUS, Protestant cites to CBP rulings. Several of these rulings classified certain products in heading 8471, HTSUS, by application of Note 5 (A) to Chapter 84. However, that particular note deals with the classification of ADP machines and Protestant does not claim that these products are ADP machines themselves. Indeed, Protestant notes that without a host [ADP] connection, the subject merchandise cannot function in their intended environments. Rather, Protestant claims that these devices are units of ADP machines, controlled by Note 5 (C) to Chapter 84. Other rulings cited by Protestant do classify goods in subheading 8471.60, HTSUS, as units of ADP machines by application of Note 5 (C) to Chapter 84: New York (NY) ruling letter I89737, dated January 22, 2003, dealt with the classification of a fingerprint recognition module; NY N074538, dated October 2, 2009, classified two models of finger

Initially, we note that the matters protested are protestable under 19 U.S.C. §1514(a)(2) as decisions on classification. The protest was timely filed, within 180 days of liquidation of the first entry. (Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2) (B) (ii), (iii) (codified as amended at 19 U.S.C. § 1514(c) (3) (2006)). Further Review of Protest No. 4197-18-100843 is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(b) because the decision against which the protest was filed is alleged to involve questions of law or fact, which have not been ruled upon by the Commissioner of Customs or his designee, or by the courts.Classification under the HTSUS is determined in accordance with the General Rules of Interpretation (“GRIs”). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied in order.In addition, in interpreting the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See T.D. 89 80, 54 Fed. Reg. 35127 (August 23, 1989). The HTSUS provisions at issue are as follows: 8471 Automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data, not elsewhere specified or included:* * *8543 Electrical machines and apparatus, having individual functions, not specified or included elsewhere in [Chapter 85]; parts thereof:* * *9106 Time of day recording apparatus and apparatu