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Sound Editing Machines Used with Computers Not Computer Parts, Court Says

Monday, February 02, 2015
Sandler, Travis & Rosenberg Trade Report

The Court of International Trade ruled in favor of U.S. Customs and Border Protection Jan. 22 in a challenge brought by an importer of audio technology regarding the classification of two digital audio mixing machines.

The machines are described as “control surfaces” because they allow the user to edit, mix and manipulate digital music on a computer’s hard drive through use of the consoles’ switches, faders and knobs. One of the control surfaces includes 16 microphone preamplifiers, a line sub-mixer and a control room monitoring section, while the other has four microphone preamplifiers and a control room monitoring section. They can both be connected to the host computer, which is loaded with the plaintiff’s proprietary software.

CBP originally classified the control surfaces as other electrical machines and apparatus under HTSUS 8543.70.96, 8543.89.96 or 8543.89.97, depending on the date of import (all of which carry a 2.6 percent duty rate). The plaintiff protested, suggesting that the items should be classified as units of automatic data processing machines under HTSUS 8471.60.10 or  8471.80.90 (both of which are duty-free). 

CBP maintained that the machines cannot be classified as units of ADP machines, citing Chapter 84, Note 5(E) of the HTSUS, which states that “machines performing a specific function other than data processing and incorporating or working in conjunction with an automatic data processing machine are to be classified in the headings appropriate to their respective functions or, failing that, in residual headings.” Because the control surfaces perform preamplifier, line sub-mixing and/or control room monitoring functions, and because they are expressly designed for remaining connected to an ADP machine while performing these functions, CBP argued that they are covered by Note 5(E).

The plaintiff, however, took the position that Note 5(E) does not apply to the audio control surfaces, contending that the phrase “working in conjunction” should be interpreted as requiring the host computer to be running, assisting or interacting with the control consoles to help them perform their non-data processing functions. According to the plaintiff, no such interaction exists in this case, and the control consoles are therefore not precluded from being classified in HTSUS heading 8471.

The CIT concluded that the dispute centers on the meaning of the phrase “working in conjunction,” which it used lexicographic sources to interpret as “functioning or operating in a specified manner while joined together for a common purpose.” Because the control consoles join with an ADP machine loaded with the plaintiff’s software to achieve the common purpose of digitally editing and mixing music, the court said, they meet this definition and are therefore classifiable in HTSUS heading 8543 .

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