CLA-2 RR:TC:FC 959588 ALS
Port Director of Customs
110 S. Fourth Street
Minneapolis, MN 55401
RE: Request for Further Review of Protest 3501-96-100179, Dated
May 7, 1996, Concerning the Classification of Character-Shaped Bottles and Their Caps in the Form of Non-Human
Characters
Dear Mr. Gonzalez:
This ruling is on a protest that was filed against your
decisions of March 8 and March 22, 1996, regarding the subject
containers.
FACTS:
The articles under consideration are plastic bottles and
decorative heads, in the form of non-human Sesame Street
characters. The articles, in their complete condition, are
approximately 9 inches in overall length and are composed of
containers in the shape of the body of various characters, which
can hold 10 ounces of liquid, and the heads of the characters
which slip over the caps of those containers. The containers are
imported empty and are filled with bubble bath for children
subsequent thereto. These articles have been classified under
the provisions chapter 39 as articles of plastics. The importer
believes that these articles should be classified under the
provision for toys representing animals or non-human creatures
and parts and accessories thereof in subheading 9503.49.0020,
Harmonized Tariff Schedule of the United States Annotated
(HTSUSA).
ISSUE:
What is the classification of empty character-shaped bottles
and decorative heads, in the form of non-human characters?
- 2 -
LAW AND ANALYSIS:
Classification of merchandise under the HTSUSA is governed
by the General Rules of Interpretation (GRI's) taken in order.
GRI 1 provides that the classification is determined first in
accordance with the terms of the headings and any relative
section and chapter notes. If GRI 1 fails to classify the goods
and if the headings and legal notes do not otherwise require, the
remaining GRI's are applied, taken in order.
In its application for further review counsel has indicated
that although prior rulings covered the character-shaped bottles,
caps and overcaps, those rulings were based on inadequate
information as to the use and marketing of the subject articles
and they did not consider any legal arguments since none were
presented with those ruling requests. We have herein considered
this new information and documentation and have reviewed the
prior rulings in light thereof.
In considering this matter we note that counsel states that
the primary purpose of the instant articles is to amuse children
and, therefore, they should be considered toys under subheading
9503.49.0020, HTSUSA. Counsel notes that the retail customer of
the bubble bath can purchase the same quantity of such bubble
bath in plain containers for less that 50 percent of the cost of
such bubble bath in the instant containers. In some instances
there is a greater disparity between the retail price of the
bubble bath in a plain container and the same bubble bath in a
character-shaped bottle. Counsel suggests that the retail
customer's willingness to purchase the bubble bath in these
bottles at the significantly higher price than the same product
in plain bottles indicates that the bottles are really the object
of such purchases. Counsel further claims that these articles,
which are plastic reproductions of puppets from a childrens
amusement program, must, ipso facto, be purchased to amuse.
Counsel further indicates that these items are licensed and
marketed as toys and that they belong to a class of goods
designed for the amusement of children. In support of its
position counsel references United States v. The Carborundum
Company, 63 CCPA 98, C.A.D. 1172, 536 F2d 373 (1976) and Lenox
Collection v. United States, Slip Op. 96-30.
The articles under consideration are containers capable of
holding liquid bubble bath and that they are only sold,
subsequent to importation, filled with bubble bath. While
counsel states that the bottles are marketed as toys, we note,
based on empirical observations by this Office in a variety of
types and number of retail establishments, that these articles
are displayed in retail establishments with other bubble bath and
shampoo containers. We were unable to confirm that these
articles, which serve as bottles, are marketed as toys. We
observed other similar containers on the purveyor's shelves.
None of these displays, including the hang tags on individual
bottles, indicated that the articles were toys although some of
the displays referred to the articles as collectibles.
Accordingly, we disagree with counsel that the application of the
factors noted in the Carborundum case would dictate a finding
that articles are toys.
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We also disagree with counsel as to the applicability of
Lenox. In that case the Court of International Trade held that
articles, shaped like Victorian houses, which could be used to
hold spices, were primarily used for decorative purposes and
should be classified as ornamental articles. Assuming arguendo
that the Lenox principles should be applied to the instant
articles and that they may be used as toys at some time, we do
not agree with counsel that the articles are primarily used for
that purpose. The President and CEO of the importer, in a letter
submitted with other information and documentation in support of
the protest, specifically states that "Once empty,
the...character package become a tub toy..." Thus, any play use
is secondary to the use of the article as a container and is
subsequent thereto.
We note that the license agreement from the copyright owner
of the various characters on which the instant articles are
based, as referenced in the sublicense to the importer, which
authorizes the importer to utilize these Sesame Street characters
in connection with hair care products, bubble bath and liquid
soap products, only refers to those products. There is no
indication in the sublicense which specifically authorizes the
importer to produce and distribute toys bearing the likeness of
the Sesame Street characters.
We also note that bubble bath for children, including the
same bubble bath that is packaged in the character-based
containers, is also sold in plain generic containers and in
brightly colored containers with labels bearing the likenesses of
characters with which a child may identify such as the Sesame
Street characters. Packaging or novelty containers are a method
which distinguishes one merchandisers product from another. The
packaging and appearance of a product also helps to attract the
impressionable buyer. Based on our observation, these types of
articles are also placed on children's eye level shelves in the
store to attract a child's attention. The imported goods,
although novel, unique and fancy, are containers. The fact that
a purchaser might be willing to pay what might be considered an
exorbitant price, does not transform a functional container into
another product.
Based on consideration of the above information and
documentation, we have concluded that the holdings of
Headquarters Ruling Letter 957825, dated September 14, 1995, New
York Ruling Letter 807937, dated April 5, 1995, and New York
Ruling Letter 898313, dated June 1, 1994, relative to the
character shaped bottles, human and non-human, the bottle caps
and the decorative head overcaps for these articles, were
correct.
HOLDING:
Character shaped plastic bubble bath/shampoo bottles in the
shape of various non-human cartoon-type characters, when imported
in their complete condition, are classifiable in subheading
3923.30.0090, HTSUSA, which provides for articles for the
conveyance or packing of goods, of plastics..., other. Articles
so classified are subject to a general rate of duty of 3 percent
ad valorem. - 4 -
Decorative head overcaps in the shape of various non-human
cartoon-type characters, which are designed to be attached to
containers in the shape of the body of the relative cartoon-type
character, are classifiable in subheading 3926.90.9890, HTSUSA,
as Other articles of plastics...: Other: Other, Other. Articles
so classified are subject to a general rate of duty of 5.3
percent ad valorem.
Since the classification indicated above is the same as the
classification under which the entries were liquidated, you are
instructed to deny the protest in full.
A copy of this ruling should be attached to the Customs Form
19 and provided to the protestant as part of the notice of action
on the protest.
In accordance with Section 3A(1)(b) of Customs Directive 099
3550-065, dated August 4, 1993, Subject: Revised Protest
Directive, this decision should be provided by your office to the
protestant no later than 60 days from the date of this letter.
Any reliquidation of the entries in accordance this decision must
be accomplished prior to the 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, Freedom of Information Act
and other public access channels.
Sincerely,
John Durant, Director
Tariff Classification Appeals
Division