CLA-2 CO:R:C:T 951261 JED
Mr. Gerald E. Gray
661 Jean-Paul Vincent
Longueuil, Quebec
Canada J4G 1R3
RE: Classification of a plastic sewing kit box and contents
Dear Mr. Gray:
Your request to Customs in New York for a tariff
classification ruling on a plastic sewing kit box, with sewing
items inside, has been referred to this office for decision. The
sample you submitted to our New York office has been forwarded to
us for examination.
FACTS:
The plastic box is (all measurements approximate) 8 1/2"
high x 13 1/2" wide x 81/2" deep. Molded into the bottom of the
box in letters 1/8" high is the phrase, "MADE IN CANADA". There
is a plastic handle recessed into the lid, plastic hinges
allowing the lid to swing open, and a plastic swivel latch on the
front panel to secure the lid to the body of the box. The first
plastic tray visible upon opening the lid has 20 plastic spindles
in compartments marked "THREAD" to hold spools of thread, and
other compartments marked RULER, SCISSORS, THIMBLES, BUTTONS, PIN
CUSHION, NEEDLES, BOBBINS, PINS, and four small unmarked
compartments. There is a small handle in the center to lift the
tray. A second plastic tray has five generalized compartments and
eight plastic dividers that can be placed into grooves in those
compartments to subdivide them into smaller areas.
Three plastic bags were packed in the sample box we
examined. We understand the sewing kit is marketed with only two
bags; one bag of sewing accessories and either a bag with 10
spools of thread of 68% polyester/32% cotton or a bag with 12
spools of 100% polyester thread. The thread is U.S. made and is
wound onto small plastic spools in Canada. The sewing
accessories consist of: pin cushion; dressmaker pencil; sewing &
knitting gauge; scissors; tape measure; two thimbles; box of
dressmaker pins; seam ripper; plastic dispenser with 30 assorted
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needles; plastic bobbin; needle threader; and nine safety pins on
a cardboard card. The accessories come from various source
countries, e.g., the scissors are marked "KOREA" and the pin
cushion is marked "TAIWAN".
What is the proper classification of the sewing kit under
the Harmonized Tariff Schedule of United States Annotated?
LAW AND ANALYSIS:
Classification of goods under the Harmonized Tariff Schedule
of the United States Annotated (HTSUSA) is in accordance with the
General Rules of Interpretation (GRI's), taken in order. GRI 1
provides that classification shall be determined according to
the terms of the headings and any relevant section or chapter
notes. Where goods cannot be classified solely on the basis of
GRI 1, and if the headings and legal notes do not otherwise
require, the remaining GRI's may be applied, taken in order.
GRI 2(b) states in pertinent part, "The classification of
goods consisting of more than one material or substance shall be
according to the principles of rule 3."
GRI 3 states, in pertinent part:
When, by application of rule 2(b) or for any other reason,
goods are, prima facie, classifiable under two or more headings,
classification shall be effected as follows:
(a) The heading which provides the most specific
description shall be preferred to headings providing a more
general description. However, when two or more headings
each refer to ... part only of the items in a set put up for
retail sale, those headings are to be regarded as equally
specific in relation to those goods, even if one of them
gives a more complete or precise description of the goods.
Since the sewing kit at issue consists of, at least, both plastic
and textile articles, which are separately provided for in the
HTSUSA, GRI 3Ib) applies as follows:
(b) ... goods put up in sets for retail sale which cannot
be classified by reference to 3(a), shall be classified as
if they consisted of the material or component which gives
them their essential character...
Explanatory Note X to GRI 3(b), which constitutes the
official interpretation of the tariff at the international level,
provides in part:
(X) For the purposes of this Rule, the term "goods put up
in sets for retail sale" shall be taken to mean goods which:
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(a) consist of at least two different articles which are,
prima facie, classifiable in different headings. ...;
(b) consist of products or articles put up together to
meet a particular need or carry out a specific activity;
and
(c) are put up in a manner suitable for sale directly to
users without repacking (e.g., in boxes or in cases or on
boards).
The sewing kit at issue here satisfies the criteria of
paragraphs (a), (b) and (c). At least two of the articles are
classifiable in different headings: the pin cushion in Heading
6307, Other made up articles, including dress patterns; and the
polyester sewing thread in Heading 5508, Sewing thread of man-
made staple fibers, whether or not put up for retail sale. The
articles are included for their utility in the activity of sewing
and they are saleable directly to users in the plastic box.
Since the sewing kit is a set, and classification of its
component parts cannot be made pursuant to GRI 3(a), the
essential character of the set must be determined in accordance
with GRI 3(b). Explanatory Note VIII to GRI 3(b) states that:
The factor which determines essential character will vary as
between different kinds of goods. It may, for example, be
determined by the nature of the material or component, its
bulk, quantity, weight or value, or by the role of a
constituent material in relation to the use of the goods.
After due consideration of the matter, it is the opinion of
this office that the plastic box imparts the essential character
of the sewing kit. It is the box which serves to organize and
store all the other included components. (See also HQ 082736,
March 20, 1990; a knitting and crochet kit consisting of a
quilted textile, fold-over case fitted with various craft supplies
was classified based on a determination that the foldover case
imparted the essential character.)
Two headings deserve consideration in arriving at the proper
classification of the sewing box; Heading 4202 and Heading 3924.
Heading 4202 is as follows:
Trunks, suitcases, vanity cases, attache cases, briefcases,
school satchels, spectacle cases, binocular cases, camera
cases, musical instrument cases, gun cases, holsters and
similar containers; traveling bags, toiletry bags, knapsacks
and backpacks, handbags, shopping bags, wallets, purses, map
cases, cigarette cases, tobacco pouches, tool bags, sports
bags, bottle cases, jewelry boxes, powder cases, cutlery
cases and similar containers, of heather or of composition
leather, of plastic sheeting, of textile materials, of
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vulcanized fiber, or of paperboard, or wholly or mainly
covered with such materials
HQ 088184, April 11, 1991, concerned the classification of a
plastic sewing box described as, "a portable plastic container
which consists of four interlocking and removable trays with a
large center compartment for storage. The trays and the main
compartment have sections for sewing accessories such as a [sic]
buttons, pins and needles, and other sewing items." The ruling
provided a detailed discussion of the choice between classifying
the sewing kit in either Heading 4202 or Heading 3924. First,
classification based on similarity to any of the articles included
after the semicolon in Heading 4202 was precluded since the sewing
box was not of, or wholly or mainly covered with, any of the
specified materials.
In determining whether the sewing box was similar to any of
the articles in the first portion of the heading, the ruling listed
size, use, physical attributes and structural integrity as factors
considered in assessing similitude. A similar container may be an
item designed to store, organize and protect those contents from
which the container derives its name. However, the ruling also
recognized a degree of portability and suitability for withstanding
the rigors of travel. Accordingly, since the sewing box in HQ
088184 was suitable only for home storage and convenience it was
excluded from classification in Heading 4202.
The plastic sewing box at issue in the instant matter is quite
similar to the box of HQ 088184. Both contain inner trays used
to organize sewing paraphernalia. The plastic hinges and latch
on the subject box make it unlikely to "withstand the rigors of
travel" much like the box in HQ 088184. Therefore, the sewing box
at issue here is not classifiable in Heading 4202. Accordingly it
is classified as an article of its constituent material, namely
plastic. Heading 3924 provides, in pertinent part, as follows:
3924 Tableware, kitchenware, other household articles
and toilet articles, of plastics:
* * * * * *
3924.90 Other
* * * * * *
3924.90.5000 Other
Such a classification carries a "General" column duty rate of 3.4%
ad valorem.
The rate line for subheading 3924.90.5000 also indicates in
the "Special" duty rate column that articles so classified that
qualify for consideration under the United States-Canada Free Trade
Agreement (CFTA) are assessed at 2% ad valorem.
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To be eligible for tariff preferences under the CFTA, goods
must be "originating goods" within the rule of origin in General
Note 3(c)(vii)(B), HTSUSA. There are two basic means in that note
by which articles imported into the United States may be "goods
originating in the te.~ritory of Canada." The first method is if
the goods are "wholly obtained or produced in the territory of
Canada and/or the United States." General Note 3(c)(vii)(B)(1).
The second method is if the goods are "transformed in the territory
of Canada and/or the United States." General Note 3(c)(vii)(B)(2).
A product which is "wholly obtained or produced in the
territory of Canada and/or the United States" is one which is
grown, mined, harvested, born and raised in Canada and/or the
United States, or otherwise intimately connected to the two
countries and their land, air and sea territories as defined in
General Note 3(c)(vii)(L), HTSUSA. The sewing kits include
articles from third countries. Accordingly, they may not be
considered "wholly obtained or produced in Canada under General
Note 3(c)(vii)(B)(1).
The second method to become an originating good for CFTA
purposes is for an article made of foreign materials to be
transformed in Canada and/or the United States in accordance with
General Note 3(c)(vii)(B)(2). A transformation is evident when
a change in tariff classification occurs that is recognized in
General Note 3Ic)(vii)(R), HTSUSA.
As described above, the articles in the sewing kit do change
classification based on the kit being treated as a "set" for tariff
purposes and the "essential character" being used to determine
proper classification. However, this is not the type of
classification change to which the CFTA refers.
General Note 3(c)Ivii)Ic)(1), HTSUSA, states;
(C) Goods shall not be considered to originate in the
territory of Canada pursuant to subdivision (c)(vii)(B)(2) merely
by virtue of having undergone--
(1)simple packaging or, except as expressly provided by the
rules of subdivision (c)(vii)(R) of this note, combining
operations...
The House Committee on Ways and Means report on the CFTA
stated:
Goods containing materials from third countries will qualify
for preferential treatment only if the materials undergo a
sufficient degree of processing or assembly in one or both
Parties to result in physically and commercially significant
changes in the product that change its tariff classification
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under the Harmonized System. H. Rep. 816, Part 1, 100th
Cong., 2d Sess. 15 (1988). "
The Committee focused'on the change in classification which
occurs to third country materials after the third country materials
undergo some processing or assembly. The articles in a set do not
change their classification because of processing or assembly. The
classification change of articles in a set occurs because of the
packaging or combining of the articles. This is not a change in
classification entitling an article to consideration under the
CFTA. Accordingly, the sewing kit is not entitled to any tariff
preference under the CFTA.
There may however be duty benefits derived from the
application of subheading 9802.00.80, HTSUSA, to certain articles
in the sewing kit, namely, the U.S. thread which is exported to
Canada to be wound on spools.
HTSUSA subheading 9802.00.80 provides for a partial duty
exemption for:
(a)rticles assembled abroad in whole or in part of fabricated
components, the product of the United States, which (a) were
exported in condition ready for assembly without further
fabrication; (b) have not lost their physical identity in
such articles by change in form, shape or otherwise; and (c)
have not been advanced in value or improved in condition
abroad except by operations incidental to the assembly
process, such as cleaning, lubricating and painting.
Customs has held that winding wire around a spool is
considered an acceptable assembly operation within the meaning of
this tariff provision. See HRL 555533 (June 4, 1990); and
General Instrument Corporation v. United States, 61 CCPA 86, C.A.D.
1128, 499 F.2d 1318 (1974), rev'g 70 Cust. Ct. 151, C.D. 4421, 359
F. Supp. 1390 (1973). In the present matter, we consider winding
the U.S. made thread around plastic spools in Canada an acceptable
assembly operation. In situations in which a portion of a set
consists of components or items assembled abroad in whole or in
part of U.S. origin fabricated components, duties will be assessed
pursuant to subheading 9802.00.80, HTSUS~ upon the full value of
the set less the cost or value of the U.S. fabricated components.
Accordingly, upon compliance with the documentary requirements of
10.24, Customs Regulations (19 CFR 10.24), duty will be assessed
upon the full value of the sewing kit less the cost or value of the
U.S. thread.
Finally, we must mention country of origin marking
requirements. Section 304, Tariff Act of 1930, as amended (19-7-
U.S.C. 1304), provides that, unless excepted, every article of
foreign origin (or its container) imported into the United States
shall be marked in a conspicuous place as legibly, indelibly and
permanently as the nature of the article (or container) will
permit, in such a manner as to indicate to the ultimate purchaser
in the United States the English name of the country of origin of
the article. Further, as indicated in T.D. 91-7, if materials or
components are not substantially transformed as a result of their
inclusion in a set, then, subject to the usual exceptions and a
common sense approach, each item must be individually marked to
indicate its own country of origin. Should you require a ruling
on the marking of the sewing kit, please contact the Value and
Marking Branch, U.S. Customs Service, 1301 Constitution Avenue,
N.W., Washington, D.C. 20229.
HOLDING:
The sewing kit submitted is considered a set for
classification purposes pursuant to GRI 3. In accord with GRI
3(b), the essential character of the set is imparted by the
plastic box. The plastic box is described, in accordance with
GRI 1, in Heading 3924. The proper classification for the
plastic box, and therefore for the sewing kit is subheading
3924.90.5000, HTSUSA.
Sincerely,
John Durant, Director
Commercial Rulings Division