CIT Finds Components of Display Wall System Classifiable as Monitors, Not Monitor Parts
Laser phosphor displays imported by Prysm for integration into a display wall system are classifiable as finished monitors, and not parts of monitors, the Court of International Trade said in a Nov. 26 decision. The LPDs are each capable of displaying an image, and can’t be considered parts of a larger whole because there is no uniform configuration of which a single LPD can be considered a part, CIT said.
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
Imported by Prysm in 2016, the LPDs had been liquidated by CBP in subheading 8528.59.33 as a “color monitor, not incorporating television reception apparatus, with a video display diagonally greater than 34.29 centimeters, with a flat panel screen, other; other,” dutiable at 5 percent. Prysm protested, arguing it should instead be classified under subheading 8529.90.99 as duty-free “parts suitable for use solely or principally with the apparatus of headings 8525 to 8528,” or alternatively in subheading 8528.51.00 as a monitor principally used in an automatic data processing (ADP) machine.
As imported, the LPDs are meant to be combined with other LPDs into a display wall system by stacking them into groups on metal frame walls, with a gap of 1/2 millimeter between each. A proprietary image processor receives the input video source and can control up to 30 LPDs, displaying a larger singe image to the end-user, CIT said.
CIT first decided whether the LPDs are monitors of heading 8528, or parts of monitors of heading 8529. It found that, “for tariff purposes … a monitor is a machine that receives data from an external source, and then processes and converts that data into physical output commands to display an image.” The LPDs “quite plainly” use “internal technology to display images and are capable of receiving signals from the Image Processors,” CIT said.
On the other hand, there is “no uniform, set configuration of which any single LPD can constitute a 'part,' because the 'whole,' in the sense of a full Display Wall System, is undefinable at the time of importation,” CIT said. A display wall has a minimum of four but up to 30 LPDs, and even one LPD is a monitor that is capable of displaying an image, it said. “Accordingly, the LPDs are 'monitors' within the meaning of the HTSUS, and thus they are properly classified under heading 8528,” CIT said.
As for whether the monitors are for use in an ADP, CIT turned to the Explanatory Notes to heading 8528, which say that monitors for ADPs “’are distinguishable from other types of monitors,’ and ‘frequently incorporate tilt and swivel adjusting mechanisms’ and ‘other ergonomic design characteristics to facilitate prolonged periods of viewing at close proximity to the monitor.” Prysm’s LPDs don’t fit that bill, nor are they “made to sit on a desk or be used as a television device,” CIT said.
On the other hand, the Explanatory Notes say monitors not classifiable as monitors for LPDs include “devices which can generate a point of light and display it on a screen synchronously with the source signals,” CIT said. “These monitors may receive coded signals, and 'must be equipped with a decoding device covering (the separation of) the R, G and B signals,'” it said. “The LPD fits squarely within the bounds of this definition,” and CBP was correct to classify it in subheading 8528.59.33, the trade court said.
(Prysm, Inc. v. U.S., Slip Op. 19-149, CIT # 18-00151, dated 11/26/19, Judge Restani)
(Munford Hall of Adduci Mastriani for plaintiff Prysm, Inc.; Marcella Powell for defendant U.S. government)