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July 26, 1999

CLA-2-84:RR:NC:1:103 E83923

CATEGORY: CLASSIFICATION

TARIFF NO.: 8428.90.0090; 8441.10.0000; 8524.99.4000; 8524.39.4000

Ms. Marilyn-Joy Cerny
Global Customs & Trade Specialists, Inc.
PO Box 102
Brewster, NY 10509

RE: The tariff classification of the AUROSYS Material Handling System from Germany

Dear Ms. Cerny:

In your letter dated June 24, 1999 on behalf of MAN Roland Inc. you requested a tariff classification ruling.

The AUROSYS Automatic Material Handling System is designed to provide efficient handling of paper rolls, as well as palletized newspaper inserts, printing plates and other materials, for newspaper printing presses. It is composed of a number of semi-automatic or fully automatic modules which are linked together in various configurations to provide a customized paper roll logistics system. A AUROSYS system is composed of the following units, all of which your client intends to import in a single shipment:

1. AUROcharge automatic truck unloading machine – transfers upright paper rolls or palletized inserts from a truck onto an unloading dock utilizing pneumatic slides, a walking floor, or a belt conveyor. The unloading operation can be initiated and monitored by the truck driver, thus minimizing the need for additional dock personnel.

2. AUROstore automatic high rack storage machine – consists of several blocks of steel shelving positioned in a parallel fashion, and a storage/retrieval unit. The steel shelving is a self-supporting structure which can have a height of up to 20 storage units. The storage/retrieval unit travels in the passages between the rows to load or unload the paper rolls and palletized inserts, as well as printing plates and spare parts for the printing press. Each roll or pallet contains a bar code which is registered in the stock management system using a scanner. Removal of materials is on a first in, first out basis.

3. AUROcut semi-automatic reel unwrapping station – consists basically of a frame with a lifting device and a turning unit. Two take-up rolls lift the roll from a transport device and rotate it by means of an electric motor. While rotating, the operator manually cuts off the end covers. Roll rotation is then stopped and the wrapping material is manually slit. The roll is then rotated once again, allowing the operator to pull off the wrapping material and visually inspect the roll for damage.

4. AUROport automatic reel and pallet transporter module – consists of a number of individual battery powered automated guided vehicles which move the paper rolls and pallets using a self-contained fork mechanism. The vehicles receive transport commands by radio or from guide cables running in the floor. An on-board computer stores the various routes.

5. AUROprep reel splicing preparation machine – prepares rolls of paper for splicing. In the semi-automatic version, the leading edge of the paper web is manually placed over a cutting bar and pressed against a cutting knife to produce a straight edge. An adhesive holding band is then automatically fixed to the roll and the operator attaches the leading edge of the paper web to the band. In the automatic version, suction grippers are used to lift the outer paper layer for cutting. After placing the adhesive band the roll is rotated so that its leading edge contacts the band, while the excess paper is simultaneously trimmed off.

6. AUROrack automatic intermediate storage unit – ensures the availability of paper rolls and palletized newspaper inserts for continuous printing press production. Reels, prepared for splicing, and palletized inserts are placed into or removed from the unit’s shelving by the AUROport AGVs. The modular shelving provides three storage levels.

7. AUROload automatic reel splicer loading machine – loads paper rolls from 350 to 1270 millimeters in diameter onto the printing press reel splicer. It utilizes a sliding platform to align the roll with the arms of the splicer, and automatically places empty roll cores into disposal bins.

8. AUROwaste automatic waste handling system – removes spoilage and general waste which accumulates in various parts of the printing plant. The waste is collected in bins, and the bins are transported by AGVs to a central waste disposal area which contains tilting devices to empty the bins. Printed spoilage is carried to the disposal area by a separate conveyor system.

9. AUROlog automatic reel and pallet management – a computer system which records all roll data and monitors the progress of rolls through the printing plant. It links together all of the individual AUROSYS system modules into a single materials supply system. Via a network, the AUROlog communicates with the central control of the printing press or with the plant’s production planning system.

In addition to the above, the AUROSYS will also be imported with Windows NT software pre-loaded on a hard disk drive, as well as a back-up of the same software on CD-ROMs.

Imported merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTS) in accordance with the General Rules of Interpretation. General Rule of Interpretation 1 states in part that, for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes. Note 4 to Section XVI of the HTS states:

Where a machine (including a combination of machines) consists of individual components (whether separate or interconnected by piping, by transmission devices, by electric cables or by other devices) intended to contribute to a clearly defined function covered by one of the headings in chapter 84 or chapter 85, then the whole falls to be classified in the heading appropriate to that function.

The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not legally binding, and therefore not dispositive, the ENs provide a commentary on the scope of the section and chapter notes of the Harmonized System and are thus useful in ascertaining the classification of merchandise under the System. Customs believes the Notes should always be consulted. See T.D. 89-80.

In discussing Note 4 to Section XVI, the ENs state:

For the purposes of this Note, the expression “intended to contribute together to a clearly defined function” covers only machines and combinations of machines essential to the performance of the function specific to the functional unit as a whole, and thus excludes machines or appliances fulfilling auxiliary functions and which do not contribute to the function of the whole.

The various components of the AUROSYS system described above, with the exception of the AUROprep, form a functional unit whose function is handling. Accordingly, the applicable subheading for the AUROSYS system, imported in a single shipment, will be 8428.90.0090, HTS, which provides for other lifting, handling, loading or unloading machinery: other machinery: other: other. The rate of duty will be free.

The AUROprep station performs an auxiliary function, cutting, and does not contribute to the function of handling performed by the balance of the AUROSYS system. Accordingly, it must be separately classified. The applicable subheading for the AUROprep station, whether imported separately or together with the balance of the AUROSYS system, will be 8441.10.0000, HTS, which provides for other machinery for making up paper pulp, paper or paperboard, including cutting machines of all kinds: cutting machines. The rate of duty will again be free.

Note 6 to Chapter 85 states:

Records, tapes and other media of heading 8523 or 8524 remain classified in those headings, whether or not they are entered with the apparatus for which they are intended.

Following Note 6 to Chapter 85, the software is also separately classifiable. The applicable classification for the software which is pre-loaded on a hard disk drive will be 8524.99.4000, HTS, which provides for records, tapes and other recorded media for sound or other similarly recorded phenomena.: other: other: other. The rate of duty will also be free. The applicable classification for the software imported on CD-ROMs will be 8524.39.4000, HTS, which provides for records, tapes and other recorded media for sound or other similarly recorded phenomena.: discs for laser reading systems: other: for reproducing representations of instructions, data, sound, and image, recorded in a machine readable binary form, and capable of being manipulated or providing interactivity to a user, by means of an automatic data processing machine; proprietary format recorded discs. The rate of duty will be 0.9 percent ad valorem.

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).

A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Alan Horowitz at 212-637-7027.

Sincerely,

Robert B. Swierupski
Director,

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