CLA-2 CO:R:C:M 954414 KCC
District Director U.S. Customs Service 300 South Ferry Street Terminal Island, Room 2017 San Pedro, California 90731
RE: Protest 2704-93-100915; 27 piece punch bowl set; glass punch bowl, "base"/bowl and cups; plastic S hooks and handle; GRI 3(b); composite good; EN Rule 3(b)(IX); set; EN Rule 3(b)(X); essential character; valuation of set; Additional U.S. Note 7, Chapter 69 application
Dear District Director:
This is in response to Protest 2704-93-100915, which pertains to the tariff classification of a 27 piece punch bowl set under the Harmonized Tariff Schedule of the United States (HTSUS). Samples were submitted for examination. Arguments made at a meeting on November 8, 1993, and an additional submission dated February 8, 1994, by counsel on behalf of the protestant were considered for this decision.
FACTS:
The article at issue is a 27 piece punch bowl set ("punch bowl set"). The punch bowl set is described by the protestant, Komodo International Corporation, as consisting of the following components:
- One 12.5 inch glass punch bowl; - One 8.5 inch glass base for the punch bowl, specially sized with ridges to fit, accommodate, and support the bowl and hold it stable while in use; - Twelve 8 oz. glass cups with handles; - Twelve plastic S hooks for use in hanging the twelve cups from the sides of the punch bowl at each of the twelve ridges located on the lip of the bowl; and - One plastic handle.
The glass punch bowl, "base," and cups all have matching designs which are molded into the glass. The punch bowl set is packaged and sold together in a retail carton which is imported with color photographs of the entire set contained therein.
Upon importation, Customs determined that the punch bowl set was classified as a set pursuant to General Rule of Interpretation (GRI) 3(b), HTSUS. The essential character of the set was determined to be the punch bowl without its "base." As the value of the punch bowl was under $3.00, the entries of the entire punch bowl set were liquidated starting on December 4, 1992, under subheading 7013.39.20, HTSUS, as other glassware of a kind used for table or kitchen purposes, valued not over $3 each.
In a protest timely filed on March 4, 1993, the protestant contends that the punch bowl set is properly classified under subheading 7013.39.60, HTSUS, as other glassware of a kind used for table or kitchen purposes, valued over $5 each. This classification is based on the value of the entire punch bowl set when it is classified as a composite good and/or a set. Alternatively, the protestant contends that the value calculation is that of the bowl and base combination only. Therefore, the alternative classification is under subheading 7013.39.50, HTSUS, which provides for other glassware of a kind used for table or kitchen purposes, valued over $3 but not over $5 each.
The competing subheadings are:
7013.39 Glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes (other than that of heading 7010 or 7018)...Glassware of a kind used for table (other than drinking glasses) or kitchen purposes other than that of glass- ceramics...Other...
7013.39.20 Valued not over $3 each.
7013.39.50 Valued over $3 each...Other...Valued over $3 butnot over $5 each.
7013.39.60 Valued over $3 each...Other...Valued over $5 each.
ISSUE:
What is the tariff classification of the 27 piece punch bowl set under the HTSUS?
LAW AND ANALYSIS:
The classification of merchandise under the HTSUS is governed by the General Rules of Interpretation (GRI's). GRI 1, HTSUS, states that, in part, "for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes...." We are of the opinion that the punch bowl set is not a composite good, but is classified as a set pursuant to GRI 3(b), HTSUS. GRI 3(b), HTSUS, states:
Mixtures, composite goods consisting of different materials or made up of different components, and 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, insofar as this criterion is applicable.
Explanatory Note (EN) Rule 3(b)(IX) of the Harmonized Commodity Description and Coding System (HCDCS) (pg. 4) states that:
For the purposes of this Rule, composite goods made up of different components shall be taken to mean not only those in which the components are attached to each other to form a practically inseparable whole but also those with separable components, provided these components are adapted one to the other and are mutually complementary and that together they form a whole which would not normally be offered for sale in separate parts (emphasis in original).
The ENs, although not dispositive, are to be looked to for the proper interpretation of the HTSUS. See, T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
For the punch bowl set to be considered a composite good for purposes of GRI 3(b), HTSUS, the components must be adapted one to the other, mutually complementary, and together form a whole which would not normally be offered for sale in separate parts. In this case, the punch bowl set components have been adapted one to the other and are mutually complementary. The glass components, i.e., bowls and cups, have the same molded design and the S hooks are designed to hook onto the punch bowl allowing the cups to hang from the other end for display. However, they do not form a whole which would not normally be offered for sale in separate parts. Punch bowls and cups can be purchased separately. Therefore, the punch bowl set is not classified as a composite good.
To determine what is a set, EN Rule 3(b)(X) (pg. 4) provides a three part test for "goods put up in sets for retail sale":
For the purposes of this Rule, the term 'goods put up in sets for retail sale' shall be taken to mean goods which:
(a) consist of at least two different articles which are prima facia, 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 repackaging (e.g., in boxes or cases or on boards).
In the present case, the punch bowl set consists of plastic S hooks and plastic handle (heading 3924), and glass punch bowls and cups (heading 7013) which are classified under different tariff provisions. All of these components are packaged together in a retail container for sale directly to the consumer without repackaging. Additionally, the components are put up together to meet a particular need or carry out a specific activity, to serve liquid refreshments. Therefore, the punch bowl set is a set for tariff purposes. To determine the proper classification, the essential character of the punch bowl set needs to be determined.
In general, essential character has been construed to mean the attribute which strongly marks or serves to distinguish what an article is; that which is indispensable to the structure, core or condition of the article. In addition, EN Rule 3(b) (pg. 4), provides further factors which help determine the essential character of goods. Factors such as bulk, quantity, weight or value, or the role of a constituent material in relation to the use of the goods are to be utilized, though the importance of certain factors will vary between different kinds of goods.
We are of the opinion that the essential character of the punch bowl set is imparted by the punch bowl alone. The punch bowl is the largest, most attractive item within the set. It is the central piece and the focus of the set when the merchandise is being used to serve liquid refreshments.
We maintain that the punch bowl and "base" do not form a single entity when determining the component which imparts the essential character. The "base" is a physically separate item in the form of another bowl. When turned upside-down the smaller bowl may be used as a "base" or pedestal for the punch bowl, however, it can also be used independently as a serving bowl. We have found advertising material and packaging for the identical 27 piece punch bowl set sold by another importer that describes the bowl/base as a serving bowl. Although, it may be used as a base for the punch bowl, it is of the class or kind of goods recognized as a serving bowl. Therefore, the bowl/base is a separate item within the set, not merely an ancillary appendage to the punch bowl.
Inasmuch as the essential character is imparted by the punch bowl, the entire set is, therefore, classified under the tariff classification subheading of the punch bowl. GRI 3(b), HTSUS, states that "...goods put up in sets for retail sale...shall be classified as if they consisted of the material or component which gives them their essential character...." The 27 piece punch bowl set is a good put up in a set for retail sale. Therefore, pursuant to GRI 3 (b), HTSUS, the set shall be classified as if it consisted of the component which gives the set its essential character. In this case, we have determined that the punch bowl imparts the essential character to the set. Therefore, the entire set is to be classified under subheading 7013.39.20, HTSUS, as other glassware of a kind used for table or kitchen purposes, valued not over $3 each, the tariff classification provision of the large punch bowl.
Counsel for the protestant cites Additional U.S. Note 7, Chapter 69, HTSUS, as instructive in classifying the entire punch bowl set based on the value of the punch bowl and "base" combination. Additional U.S. Note 7, Chapter 69, HTSUS, provides:
For the purposes of headings 6911, 6912 and 6913, those provisions which classify merchandise according to the value of each "articles," and article is a single tariff entity which may consist of more than one piece. For example, a vegetable dish and its cover, or a beverage pot and its lid, imported in the same shipment, constitute one article.
Counsel maintains that Additional U.S. Note 7, Chapter 69, HTSUS, is instructive for classification of articles in Chapter 70, HTSUS. Counsel states that both chapters are in Section XIII, HTSUS, have value-based classification subheadings, and include articles for use in serving or storing food or beverages which typically consist of more than one piece, i.e., teapot and cover, sugar bowl and cover, etc.
We are of the opinion that the application of a legal note in Chapter 69 to Chapter 70 is inappropriate. First, Chapter 69, HTSUS, covers articles of ceramic or porcelain, not of glass. Secondly, there is no language in Additional U.S. Note 7, Chapter 69, HTSUS, which expressly states that the note is to be applied to goods of other chapters under the HTSUS. Moreover, Additional U.S. Note 7, Chapter 69, HTSUS, specifically limits its application to headings 6911, 6912, and 6913, HTSUS. We believe that it is inappropriate to apply notes concerning one class of articles by implication. Therefore, Additional U.S. Note 7, Chapter 69, HTSUS, cannot be used to affect the classification of goods classifiable in Chapter 70, HTSUS.
HOLDING:
In accordance with GRI 3(b), HTSUS, the 27 piece punch bowl set is a set classified pursuant to the component which gives the set its essential character, the punch bowl. Therefore, the entire 27 piece punch bowl set is classified under subheading 7013.39.20, HTSUS, as other glassware of a kind used for table or kitchen purposes, valued not over $3 each.
The protest should be DENIED. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed, with the Customs Form 19, by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, Lexis, Freedom of Information Act, and other public access channels.
Sincerely, John Durant, Director