HQ 087507: Protest No. 2704-89-003106; Audio Stereo System; Radiobroadcast Receiver; Amplifier; Turntable; Dual Cassette Deck; Double; Combined In Same Housing; GRI 3 Set

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 087507

                          August 8, 1991

CLA-2 CO:R:C:M 087507 CMS

CATEGORY: Classification

TARIFF NO.:  8518.40.20, 8519.21.00 
             8520.31.00, 8527.39.00

District Director Of Customs
300 South Ferry St., Terminal Is.
San Pedro, CA 90731

RE:  Protest No. 2704-89-003106; Audio Stereo System;
     Radiobroadcast Receiver; Amplifier; Turntable; Dual Cassette
     Deck; Double; Combined In Same Housing; GRI 3 Set

Dear District Director:

    This protest was filed against your liquidation dated July 
7, 1989, in which certain audio system components were classified
in subheading 8527.39.00, Harmonized Tariff Schedule of the
United States Annotated (HTSUSA).

FACTS:

    The merchandise is described by the importer as the "Marantz
MS-432 Matched Components,Master Pack" (Master Pack). The Master
Pack consists of a large package containing an individually
housed tuner, amplifier, turntable and dual cassette deck.  The
four components are sold at retail in the Master Pack.

    After importation, speakers and a wooden "rack" unit are
added to and sold with the merchandise. The "rack" unit contains
shelves or "racks" onto which the separately housed components
are placed. Other components such as a compact disc player and
equalizer may also be added to the system by the user.

ISSUE:

    Is the merchandise classified as a GRI 3 set in a single
housing, or are the components classified separately in their 
own appropriate headings?

LAW AND ANALYSIS:

    The HTSUSA provides that the classification of articles is
governed by the General Rules of Interpretation (GRI's). GRI 1
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states in pertinent part that ..classification shall be determined
according to the terms of the headings and any relative section or
chapter notes...".

    Heading 8527 in pertinent part describes reception apparatus
for radiobroadcasting, whether or not combined, in the same 
housinq, with sound recording or reproducing apparatus or a
clock.

    In the importer's submission dated January 22, 1991, it is
argued that the merchandise should be classified pursuant to GRI
1 because it is described by the terms of Heading 8527.

    Heading 8527 does describe reception apparatus (e.g.,
tuners) whether or not combined with recording or reproducing
apparatus. However, the heading only covers sound recordinq or 
reproducing apparatus (e.g., cassette decks, turntables) when
they are combined "in the same housing" with the reception
apparatus.  The imported goods are tuners, amplifiers and other
components which are already incorporated in their own separate
housings. Placing the separately housed cassette decks and
turntables on shelves or "racks" with other separately housed
components simply does not convert the different components into
a Heading 8527 good, combined in the same housing by the mere
fact that the separately housed.. components are placed on
shelves or "racks" of a shelving structure.

    The merchandise is not classified pursuant to GRI 1. The
merchandise is also not an incomplete good having the essential
character of a complete good described by a heading, and the
merchandise is not classified pursuant to GRI 2.

    The imported Master Packs are partly described by two or 
more headings (e.g., tuners, Heading 8527; amplifiers, Heading
8518). The merchandise cannot be classified pursuant to GRI 
3(a), according to the most specific heading, because GRI 3(a)
provides that headings which partly describe the merchandise are
deemed to be equally specific.

    The Master Packs, consisting of at least two articles
classifiable in different headings, put up together to carry out
a specific activity or meet a particular need (audio
entertainment), and put up in a manner suitable for sale to users
without repacking are GRI 3(b) sets. See Explanatory Notes to 
GRI 3, and HQ Ruling 085577 (January 10, 1990).

    The audio system components within the Master Packs
essentially contribute equally to the activity performed or need
met (audio entertainment). No single audio system component gives
the system its essential character. Accordingly, the set



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cannot be classified according to the GRI 3(b) provision which
states that the set shall be classified according to the
component which gives the set its essential character. For
additional discussion, see HQ Ruling 085577 (January 10, 1990).

    GRI 3(c) provides that goods which cannot be classified by
reference to GRI 3(a) or 3(b), shall be classified under the
heading which occurs last in numerical order among those which
equally merit consideration.

     The components of the various systems would separately be
classified in Headings 8518 (amplifier), 8519 (turntable), 8520
(dual cassette deck), and 8527 (tuner).

    The Master Pack is classified in the Heading for the tuner,
in subheading 8527.39.00, HTSUSA.

    We note the protestant's argument that the term "in the 
same housing" does not appear at the subheading level. This does
not result, however, in the merchandise being classified in a
subheading other than subheading 8527.39.00, HTSUSA. It is
elementary that to be classified in a subheading, an article must
first satisfy the terms of the headinq. The Master Packs are not
described by the terms of Heading 8527. The imported goods are
tuners, amplifiers and other components which are already
incorporated in their own separate housings. Placing the
separately housed cassette decks and turntables on shelves or
"racks" with other separately housed components simply does not
convert the different components into a Heading 8527 good,
combined in the same housing by the mere fact that the separately
housed components are placed on shelves or "racks" of a shelving
structure.

HOLDING:

    The Master Pack is classified in subheading 8527.39.00,
HTSUSA. The protest should be denied.  A copy of this decision
should be attached to the Form 19 Notice of Action.

                              Sincerely,

                              John Durant, Director
                              Commercial Rulings Division