CLA-2 RR:CR:TE: 963377 jsj
Ms. Marianne Miranda
Federated Merchandising Group
1440 Broadway
13th Floor
New York, New York 10018
Re: “Cooler Backpack / Picnic Set”; Subheading 4202.92.4500, HTSUSA; General Rules of Interpretation 1 and 3; Sets; “More Than” Doctrine; JVC Company of America v. United States.
Dear Ms. Miranda:
The purpose of this correspondence is to respond to the request of Federated Merchandising Group of June 25, 1999. The correspondent requested a binding classification ruling of an article described as a “cooler backpack / picnic set.”
This ruling is being issued subsequent to the following: (1) A review of Federated’s submission dated June 25, 1999; and (2) An examination of the sample identified as item number: PB-0068.
The Customs Service will retain the sample submitted with your ruling request.
FACTS
The article in issue, identified as a “cooler backpack / picnic set,” is an insulated backpack with a ten piece place setting consisting of two plastic plates, cups, knives, forks and spoons.
The backpack has four compartments and an outer layer composed entirely of a compact plastic sheeting with a textile backing. Federated’s submission does not indicate the nature of the material and the Customs Service did not have the item analyzed in its laboratory, but the plastic appears to be polyvinyl chloride.
The primary compartment is approximately twelve and three-fourths (12 ¾) inches deep, eleven (11) inches wide and six (6) inches from front to back. The top of the primary compartment has a nineteen and one-half (19 ½) inch long and five and one-half (5 ½) inch wide flap that crosses over the top of the compartment from the right side to the left. The flap extends approximately four and one-fourth (4 ¼) inches down each side of the main compartment. It secures closed through the use of a double zipper system in which there is a zipper on the front aspect of the flap, as well as one on the rear aspect of the flap. The left side of the flap closure additionally secures to the backpack by means of a hook and loop fastener system.
The interior of the main compartment is composed of aluminized plastic sheeting. The compartment is insulated with a three-eighths (3/8) of an inch thick, dense plastic foam. The foam is believed to be polyethylene, but the Customs Service has not been specifically advised. Federated has also not advised the Customs Service of the insulative properties, if any, of the article and the Customs Service has not undertaken a laboratory analysis.
The main compartment has a clear polyvinyl chloride removable waterproof insert. The insert has the same dimensions as the main compartment, except that it is only eight and one-half (8 ½) inches deep. The insert attaches to the interior of the main compartment by hook and loop fasteners that are on all four sides of the top part of the insert.
The main compartment also has a cardboard insert that fits snugly in the bottom. The cardboard is approximately one-sixteenth (1/16) of an inch thick. It is entirely enclosed by aluminized plastic sheeting that is folded over and sewn on three sides.
The three additional compartments are located on the front, left and right sides of the main compartment. The pockets on left and right sides are six and one-fourth (6 ¼) inches deep, two and one-half (2 ½) inches from front to back and six (6) inches wide. The side pockets are each attached to the lower side aspects of the backpack and extend upward. The pockets secure closed through the use of a single zipper that is approximately one and one-fourth (1 ¼) inches from the top of the pocket.
The interior of each pocket is composed of the same material as that which composes the exterior of the backpack, compact plastic sheeting with a textile backing. The pockets are entirely lined, or as stated in Federated’s submission, “padded” with a three-eighths (3/8) of an inch thick spongy foam. Federated Correspondence, June 25, 1999. It may be assumed that the foam affords some insulative value but, as previously stated, Customs has not been provided any information. It is specifically noted that Customs was provided no information suggesting that the insulative properties of the “cooler backpack” were similar to those of both hard and soft-sided insulated coolers.
The front pocket is as wide as the main compartment, nine and three-fourths (9 ¾) inches deep and two and one-half (2 ½) inches from front to back. It secures closed through the use of a zipper that is approximately one and three-fourths (1 ¾) inches from the top of the pocket. The construction is in all other respects identical to the side pockets with an interior of compact plastic sheeting with a textile backing and a lining or “padding” of three-eighths (3/8) of an inch thick spongy foam. Federated Correspondence, Id.
The backpack has a handle sewn to the top, rear aspect of the pack and two adjustable shoulder straps. The handle and adjustable or lower aspects of the shoulder straps are made of one (1) inch wide nylon webbing. The handle is seven and three-fourths (7 ¾) inches long. The shoulder straps are one and five-eighths (1 5/8) inches wide and have padding composed of the same material used to insulate the main compartment, the three-eighths (3/8) of an inch thick, dense plastic foam. Plastic clips permanently attached to the bottom aspect of the shoulder pads permit the user to adjust the nylon webbing shoulder strap length. The shoulder straps, at maximum extension, measure approximately thirty (30) inches in length.
The adjustable aspects of the nylon webbing shoulder straps are attached to the lower aspects of each side of the article. Two triangular-shaped pieces of material, one on each side of the backpack, are employed to attach the nylon webbing to the body of the backpack. The triangular-shaped pieces of material extend one and one-half (1 ½) inches from the side of the backpack to the tip of the triangle.
The “cooler backpack” will be importer with a place setting for two that includes plates, knives, forks, spoons and cups. The plates are ten (10) inches in diameter. The knives, forks and spoons measure, respectively, seven and one-fourth (7 ¼) inches, seven (7) inches, and seven and one-fourth (7 ¼) inches in length. The cups are three and three-fourths (3 ¾) inches deep and three and one-eighth (3 1/8) inches in diameter. The plates, knives, forks, spoons and cups are made of plastic.
The country of origin of all the merchandise is stated to be the People’s Republic of China.
ISSUE
What is the classification, pursuant to the Harmonized Tariff Schedule of the United States Annotated, of the “cooler backpack / picnic set” which includes the backpack and the plastic plates, cups, knives, forks and spoons ?
Do the backpack, plates, cups, knives, forks and spoons constitute “items in a set put up for retail sale” pursuant to General Rule of Interpretation 3 (a) resulting in their classification by the component which gives the set its essential character ?; and
If the backpack, plates, cups, knives, forks and spoons constitute a set pursuant to General Rule of Interpretation 3 (a), what is the component of the set pursuant to General Rule of Interpretation 3 (b) that gives the set its essential character for classification purposes?
LAW AND ANALYSIS
The responsibility for interpreting and applying the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) rests with the U.S. Customs Service. The Customs Service, in accordance with its legislative mandate, classifies imported merchandise pursuant to the General Rules of Interpretation (GRI) and the Additional U.S. Rules of Interpretation.
General Rule of Interpretation 1 provides, in part, that classification decisions are to be “determined according to the terms of the headings and any relative section or chapter notes.” General Rule of Interpretation 1. Although GRI 1 further provides that merchandise which can not be classified in accordance with the dictates of GRI 1 should be classified pursuant to the other General Rules of Interpretation in their sequential order, the Explanatory Notes (EN) “make it quite clear that the terms of the headings and any relative Section or Chapter Notes are paramount.” General Rules for the Interpretation of the Harmonized System, Rule 1, Explanatory Note (V).
The Explanatory Notes constitute the official interpretation of the Harmonized System at the international level. See Joint Explanatory Statement supra note 1, at 549. The Explanatory Notes, although neither legally binding nor dispositive of classification issues, do provide commentary on the scope of each heading of the HTSUSA. The EN’s are generally indicative of the proper interpretation of the headings. See T.D. 89-80, 54 Fed. Reg. 35127-28 (Aug. 23, 1989); Lonza, Inc. v. United States, 46 F. 3rd 1098, 1109 (Fed. Cir. 1995).
Commencing classification of the backpack and the plastic plates, cups, knives, forks and spoons in accordance with the dictates of GRI 1, the Customs Service examined the headings of the HTSUSA. While this is the mandatory initial step in the classification process, the Customs Service is also appreciative of the fact that “many goods are classified in the Nomenclature without recourse to any further consideration of the Interpretative Rules.” General Rules for the Interpretation of the Harmonized System, Rule 1, Explanatory Note (IV). Since the backpack, plates, cups, knives, forks and spoons can not be classified pursuant to GRI 1 solely by reference to one HTSUSA heading and section or chapter notes, GRI 1 instructs that the merchandise should be classified pursuant to the subsequent GRI’s, in their sequential order.
A review of GRI 2 leads the Customs Service to the conclusion that its provisions will not prove beneficial in classifying the articles that comprise the “cooler backpack / picnic set.” The merchandise under consideration in this ruling letter does not constitute incomplete, unfinished, unassembled or disassembled articles that are addressed in GRI 2 (a). The backpack, plates, cups, knives, forks and spoons are composed of plastic sheeting, aluminized plastic sheeting, plastic foam, plastic and cardboard and are, in accordance with GRI 2(b), “goods consisting of more than one material.” Goods consisting of more than one material that cannot be classified pursuant to GRI 1 or GRI 2 are to be classified according to GRI 3.
An examination of the dictates of GRI 3 becomes appropriate when goods are prima facie classifiable under two or more headings. The backpack, plates, cups, knives, forks and spoons, if classified individually, would respectively be classified in the following headings: (1) The backpack, heading 4202, HTSUSA; and (2) The plastic plates, cups, knives, forks and spoons, heading 3924, HTSUSA.
The Customs Service, prior to proceeding with further analysis of GRI 3, believes that it is prudent to initially address its conclusion that the backpack is classified under heading 4202, HTSUSA, and the plastic plates, cups, knives, forks and spoons under heading 3924, HTSUSA.
A survey of the HTSUSA headings by the Customs Service led to Chapter 42, Articles of Leather; Saddlery and Harness; Travel Goods, Handbags and Similar Containers; Articles of Animal Gut (Other than Silkworm Gut). Heading 4202 of Chapter 42 provides:
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 leather or of composition leather, of sheeting of plastics, of textile materials, of vulcanized fiber, or of paperboard, or wholly of mainly covered with such materials or with paper. (Emphasis added).
Since backpacks are designated eo nomine, that is by name, in heading 4202, HTSUSA, and since eo nomine designations include all forms of the article in issue, the questions become “What merchandise did Congress intend to be considered a “backpack”?” and “Does the article submitted for classification by Federated fall within the congressionally intended definition?”
The initial responsibility of the Customs Service is to examine the plain meaning of the statutory text. See Marcor Dev. Corp. v. United States, 926 F. Supp. 1124, 1129 (C.I.T. 1996) citing Trans-Border Customs Services v. United States, 843 F. Supp. 1482, 1485 (C.I.T. 1994). If the plain language of the heading establishes the clear and unambiguous intent of Congress, the classification inquiry at the heading level is complete. See Id. The meaning of a tariff term, absent contrary congressional intent, is one that is in accord with its common and popular understanding. See Carl Zeiss, Inc. v. United States, 195 F. 3rd 1375, 1379 (Fed. Cir. 1999).
It is the conclusion of the Customs Service, subsequent to a review of the tariff schedule, that Congress intended the term “backpack” to be understood in its common and popular meaning. “Backpacks” are commonly understood to be a pack or knapsack used to carry personal effects which include equipment, clothing and food, and are worn on the back of the user. Additional U.S. Note 1 to Chapter 42 specifically provides that “travel, sports and similar bags” of heading 4202, HTSUSA, “means goods…of a kind designed for carrying clothing and other personal effects during travel, including backpacks….” Additional U.S. Note 1, Ch. 42, HTSUSA.
Since neither the tariff schedule nor the Explanatory Notes offer a definition of the term “backpack,” the Customs Service deemed it judicious to confirm the common and popular meaning by reviewing the definition of “backpack.” See generally Carl Zeiss Id. (providing that reference to dictionaries and other reliable sources are acceptable methods of construing tariff terms). It is the conclusion of Customs that words such as “backpack” are frequently not defined in the tariff schedule because they are of such common understanding that the reader may fully understand Congress’ intent without additional explanation.
A survey of respected dictionaries provides the following definitions of the word “backpack”:
(1) “ a pack carried on the back”… “to carry a pack on the back: used esp. of hiking, camping, ect.” The Compact Edition of the Oxford English Dictionary, Vol. III, p. 45 (R.W. Burchfield, ed., Oxford at the Clarendon Press 1987);
(2) “to carry (food or equipment) on the back esp. in camping…to carry one’s food or equipment on the back esp. in camping.” Webster’s Third New International Dictionary of the English Language Unabridged (Philip Babcoci Gove, Ph.D. ed., Merriam-Webster, Inc. 1986);
“a pack or knapsack, often of canvas or nylon, to be carried on one’s back…a piece of equipment designed to be used while being carried on the back.” Random House Unabridged Dictionary (Stuart Berg Flexner ed., Random House, 2nd ed. 1983); and
“a pack or bundle of supplies to be carried on one’s back, often supported on a lightweight metal frame strapped to the body.” The Random House Dictionary of the English Language (Jess Stein ed., Random House 1973).
It is the conclusion of the Customs Service, subsequent to reviewing the referenced dictionaries, that the term “ backpack” is commonly understood to be a pack or knapsack used to carry personal effects which include equipment, clothing and food while being worn on the back of the user. The common theme in the definitions is the transportation of personal effects, including food, clothing and equipment, and the manner in which the personal effects are transported.
Endeavoring to develop an even more in-depth understanding of the term “backpack” and appreciating that no single word of the tariff schedule should be read in isolation, it is noted that heading 4202, HTSUSA, does not simply reference “backpacks.” Heading 4202, HTSUSA, in addition to the numerous other types of containers enumerated, specifically references “knapsacks and backpacks.” (Emphasis added) Heading 4202, HTSUSA. Congress, by listing “knapsacks and backpacks” together, indicated an intent that knapsacks and backpacks should be understood together.
This understanding of the tariff schedule is supported by the definition of “knapsack” in The Oxford English Dictionary, as well as Webster’s New Collegiate Dictionary. “Knapsack” is defined in The Oxford English Dictionary as “[a] bag or case of stout canvas or leather, worn by solders, strapped to the back and used carrying necessaries; any similar receptacle used by travellers for carrying light articles.” The Compact Edition of the Oxford English Dictionary, Vol. I, p. 1544 ( R. W. Burchfield, ed. 1987). Webster’s New Collegiate Dictionary defines “knapsack” as “a bag (of canvas or nylon) strapped on the back and used (as on a hike) for carrying supplies or personal belongings.” Webster’s New Collegiate Dictionary (Henry Bosley Woolf et al. eds., G. & C. Merriam Co. 1977).
The understanding that the terms knapsack and backpack are essentially synonymous is supported by the Court of Customs and Patent Appeals decision of United States v. Standard Surplus Sales, Inc., 667 F.2d 1011 (C.C.P.A. 1981). The Court in Standard Surplus was called on to classify merchandise according to the Tariff Schedule of the United States (TSUS), the predecessor of the HTSUSA. The Court, in determining whether certain imported nylon bags were classifiable as sports equipment or as luggage, examined whether there was a distinction between knapsacks and backpacks. The conclusion drawn was that knapsack is a term that proceeded the use of the word backpack, but beyond historical considerations, both terms refer to substantially identical merchandise used for carrying clothing and other personal effects and supplies on the back during travel.
It is, therefore, the decision of the Customs Service that Congress, when it enacted the Harmonized Tariff Schedule of the United States Annotated, intended the term “backpack” as employed in heading 4202, HTSUSA, to encompass packs or knapsacks used to carry personal effects, including equipment, clothing and food, that are worn on the back of the user. Having developed an understanding of the congressionally intended definition of the tariff term “backpack,” the responsibility of the Customs Service turns to determining whether the backpack in issue falls within the meaning of the HTSUSA term.
It is the conclusion of Customs that the backpack of instant classification comports with the congressionally intended definition of the phrase “knapsacks and backpacks” in heading 4202, HTSUSA. The instant article has the shape of a small backpack. It is designed and manufactured to carry personal effects while being worn on the user’s back. It is specifically noted that although the backpack has a handle on the rear aspect of the top, common among many backpacks, the handle is only designed to facilitate moving the pack very short distances. The shoulder straps and adjustable nylon webbing straps enable the backpack and its contents to be transported longer distances. It is additionally noted that, depending on how the pack is loaded, it is foreseeable that it will have a strong propensity to swing at an awkward angle if carried by the handle. The simple innovation of providing insulated compartments does not change the identity of this item.
Heading 4202, HTSUSA, pursuant to General Rule of Interpretation 1, specifically identifies the article in issue. No other HTSUSA heading specifically describes the merchandise. The backpack presented by Federated is, therefore, classifiable under heading 4202, HTSUSA.
The Customs Service in arriving at this conclusion is cognizant of and took into full consideration of the Court of Appeals for the Federal Circuit decision in SGI, Inc. v. United States, 122 F. 3d 1468 (Fed. Cir. 1997). The court in SGI held that “portable soft-sided vinyl coolers” used for the storage and serving of food or beverages, that possess insulative properties similar to both hard and other soft-sided coolers having a one-half inch thick closed cell polyethylene foam insulation are properly classified as “other household articles…of plastics” in subheading 3924.10.50, HTSUSA. Id. at 1469. The holding in SGI is distinguishable from the instant ruling.
The Court in SGI because it was called on to address the classification of “coolers” with one-half (1/2) inch thick insulation, merchandise that was not identified eo nomine, that is by name, in the tariff schedule, applied the ejusdem generis rule of statutory construction. SGI at 1471. Application of the rule of ejusdem generis, which means “of the same kind,” involves a comparison of the enumerated items in a heading or subheading with the article under consideration.
The Customs Service in this ruling is not confronted with a situation in which it must compare the essential characteristics or purposes of the article in issue with the items in heading 4202, HTSUSA, provided for eo nomine. The HTSUSA specifically identifies “backpacks” in heading 4202, HTSUSA, and mandates that backpacks be classified in heading 4202, HTSUSA, without recourse to the ejusdem generis rule or any other rule of statutory construction.
The Customs Service is conscious of the Court’s dicta focusing ejusdem generis analysis on whether food or beverage was to be transported in the article, but respectfully concludes that it would be improper to apply similar analysis in this ruling. The item under consideration in the instant ruling is a backpack. Backpacks are identified by name in heading 4202, HTSUSA. Applying General Rule of Interpretation 1, which provides that “classification shall be determined according to the terms of the headings,” mandates that the Customs Service not undertake further analysis. Undertaking further analysis under the rationale of engaging in statutory construction would breach Customs’ responsibility to classify merchandise according to the congressionally enacted General Rules of Interpretation.
The Customs Service is aware that some importers may advocate that the “cooler backpack / picnic set,” particularly the backpack, is more than a travel or sports bag because of its insulated compartment. The basis for this position being the “more than” doctrine, a doctrine created by the Court of Appeals for the Federal Circuit in Digital Equipment Corp. v. United States, 889 F.2d 267 (Fed. Cir. 1989). The “more than” doctrine provided that “merchandise which constitutes more than a particular article or which has additional nonsubordinate or coequal functions is not classifiable as that article.” Id. at 268. Application of the “more than” doctrine in this instance suggests that since the backpack has insulative qualities, it is “more than” a backpack and, therefore, is not classified as a backpack in heading 4202, HTSUS.
Although the Customs Service specifically concludes that the “cooler backpack” is designated eo nomine in heading 4202, HTSUSA, reasoning that the insulated compartments do not preclude the item from being a “backpack,” the “more than” doctrine is not an accepted method of interpreting the HTSUSA. The Court of Appeals for the Federal Circuit in the decision of JVC Company of America v. United States, 234 F. 3d 1348 (Fed. Cir. 2000) held that the “more than” doctrine, developed to interpret the Tariff Schedule of the United States, was superceded by the General Rules of Interpretation of the HTSUSA and does not apply to cases arising under the HTSUSA. The Court further held that the General Rules of Interpretation are a “statutorily-prescribed, comprehensive, and systematic method of classification” that supplanted the judicially-created “more than” doctrine. Id. at 1354.
Having concluded that the backpack is classified in heading 4202, HTSUSA, it is necessary to classify the item at the appropriate subheading level. The backpack of instant classification is classified in subheading 4202.92.4500, HTSUSA, as a “…backpack and knapsack…With an outer surface of sheeting of plastic or of textile materials: Other.”
The plastic plates, cups, knives, forks and spoons are classifiable in Chapter 39, Plastic and Articles Thereof.” The heading that describes the items is heading 3924, HTSUSA, which provides for “Tableware, kitchenware, other household articles and toilet articles, of plastics.” A review of the Explanatory Notes to Chapter 39 supports this decision as it relates to the plastic plates, cups, knives, forks and spoons. Explanatory Note 39.24 (A) provides that “tableware” includes plates, cups, knives, forks and spoons made of plastic. Explanatory Note 39.24 (A).
The Customs Service specifically notes that although plates and cups are designated eo nomine in subheading 3924.10.20, HTSUSA, proper application of the General Rules of Interpretation precludes classifying merchandise by an initial examination of the subheadings. General Rule of Interpretation 1 mandates that the merchandise under classification consideration initially comport with the heading prior to examining the subheadings of a heading. In the instant situation, the heading which most specifically describes the plates, cups, knives, forks and spoons made of plastic is heading 3924, HTSUSA.
Continuing with the application of General Rule of Interpretation 3, GRI 3(a) provides that the articles should be classified according to the heading which affords the most specific description, unless the multiple headings under consideration refer to only part of the materials or substances contained in goods that are mixed or composite, or to only part of “items in a set put up for retail sale.” General Rule of Interpretation 3. The backpack and the plastic plates, cups, knives, forks and spoons are not mixed or composite goods, warranting inquiry into the issue of whether they cumulatively constitute “items in a set put up for retail sale.” Id.
The General Rules of Interpretation do not define the phrase “items in a set put up for retail sale.” The Explanatory Notes do, however, offer guidance. The precise phrase in GRI 3(a) “items in a set put up for retail sale” is not addressed in the EN’s. The EN’s do however address a similar phrase employed in GRI 3(b). The phrase employed in GRI 3(b) and discussed in the EN’s is “goods put up in sets for retail sale.” General Rules for the Interpretation of the Harmonized System, Rule 3 (b), Explanatory Note (X). It is the conclusion of the Customs Service that the two phrases address the same issue.
Explanatory Note (X) of GRI 3(b) provides three factors to be considered when determining whether goods have been put up in sets for retail sale. The factors are:
The goods consist of at least two different articles that are, prima
facie, classifiable in different headings;
The goods consist of articles put up together to “meet a particular
need or carry out a specific purpose;” and
The goods are “put up in a manner suitable for sale directly to
users without repacking.” General Rules for the Interpretation of the Harmonized System, Rule 3(b), Explanatory Note (X) (a) – (c).
A review of the HTSUSA and an examination of the “cooler backpack / picnic set” leads the Customs Service to the conclusion that the backpack and the plastic plates, cups, knives, forks and spoons are prima facie classifiable in different headings. The second issue that addresses the second of the three factors, is whether the articles as put up together “meet a particular need or carry out a specific activity.” General Rules for the Interpretation of the Harmonized System, Rule 3(b), Explanatory Note (X)(b).
The Explanatory Notes do not define the phrase “meet a particular need or carry out a specific activity.” Id. The EN’s do, however, offer examples of items put up together for sale directly to the user which constitute sets. The initial example consists of “a sandwich made of beef, with or without cheese, in a bun…,packaged with potato chips (French Fries).” General Rules for the Interpretation of the Harmonized System, Rule 3(b), Explanatory Note (X)(1)(a). The second example consists of items to be used together to prepare a spaghetti meal. The components include: (1) A packet of uncooked spaghetti; (2) A sachet of grated cheese, and (3) A small tin of tomato sauce, put up in a carton. See General Rules for the Interpretation of the Harmonized System, Rule 3(b), Explanatory Note (X)(b). The third example is a hairdressing set. The items in this set include: (1) A pair of electric hair clippers; (2) A comb; (3) A pair of scissors; (4) A brush; (5) A towel of textile material; and (6) a leather case to store and carry the items. See General Rules for the Interpretation of the Harmonized System, Rule 3(b), Explanatory Note (X)(2). The final example of a set is a drawing kit. The drawing kit includes five items put up together in a case of plastic sheeting. The items are: (1) A ruler; (2) A disc calculator; (3) A drawing compass; (4) A pencil; and (5) A pencil-sharpener. See General Rules for the Interpretation of the Harmonized System, Rule 3(b), Explanatory Note (X)(3).
A review of each of the examples of sets in EN (X) indicates that components of sets share at lease one common trait. See HQ 953472 (Mar. 21, 1994). The fact that the drafters of EN (X) did not explain when goods put up together “meet a particular need or carry out a specific purpose” suggests that resolution of the issue must be determined by analogy on a case-by-case basis.
The items that comprise each example of a set in EN (X) are related to one another in such a fashion that they interact together to serve a distinct purpose or function to enable a singular result to be achieved. The items in examples one and two are used in conjunction with one another to complete a sandwich meal and prepare a spaghetti meal. The articles in example three are used together for the purpose of hair grooming and the items in example four function with one another to enable the user to draw.
The Customs Service in prior ruling letters has addressed the issue of whether items packaged together constitute sets. The issue in HQ 955714 (Mar. 31, 1994) was whether a ring holder, jewelry box and perfume bottle constituted a vanity set. The ruling concluded that the articles, as packaged, served the particular need of decorative storage and display of vanity items. See also HQ 951902 (Jan. 29, 1996) (addressing a set of kitchen towels) modified by HQ 958198 (Aug. 28, 1992) (modification not changing “essential character” analysis).
Pistol cleaning equipment were the items of consideration in HQ 087432 (Oct. 2, 1990). The articles packaged together included a pistol grip, a base steel bar with a bronze joint and muzzle protector, an extension bar, a bronze bit, a phosphor bronze brush and a cotton bristle. The Customs Service concluded that these items functioned together to carry out the specific activity of cleaning a pistol.
The Explanatory Notes, in addition to offering examples of items that constitute sets, also provides examples of collections of articles which do not function with one another to the degree necessary to establish a set. The initial accumulation of items in EN (X) consists of a can of shrimp, a can of pate de foie, a can of cheese, a can of sliced bacon and a can of cocktail sausages. See General Rules for the Interpretation of the Harmonized System, Rule 3(b), Explanatory Note (X)(1). The second example includes a bottle of spirits and a bottle of wine. See id. The items in the first example, although related to one another and usable together, do not “interact with one another so as to comprise a single dish.” HQ 953472 supra. It was concluded in the same ruling that the wine and spirits example did not constitute a set because they would not be used together for the mixing of a single drink nor suitable for serving together on a particular occasion. See HQ 953472 Id.
The Customs Service, in determining whether all of the articles that comprise the “cooler backpack / picnic set” “meet a particular need or carry out a specific activity,” may not simply consider the plates, cups, knives, forks and spoons. Customs must also take into consideration the backpack, the container with which the other articles are presented for sale and with which they will be imported.
The Customs Service concludes that the plates, cups, knives, forks and spoons, if imported without the backpack and suitably packaged, would be considered a set. These items serve the particular need or carry out the specific activity of enabling a meal to be served. The issue that requires greater attention is whether the backpack and all the other items, as put up together for sale, interrelate in a fashion that they meet a particular need or carry out a specific activity.
Customs initially notes that accumulations of merchandise which include containers are not, for that reason alone, precluded from being designated as sets for classification purposes. Explanatory Note (X) to GRI 3 (b) includes examples of a hairdressing set that includes a leather case and a drawing kit that has a case of plastic sheeting. See General Rules for the Interpretation of the Harmonized System, Rule 3(b), Explanatory Note (X)(2) and (3). Customs has also previously issued ruling letters in which sets included containers or holders. See HQ 084717 (Sept. 9, 1989) (toolbox and tool and electrical connector assortment); HQ 082049 (June 20, 1989) (vinyl zippered carrying bag and cookware); HQ 088323 (June 7, 1991) (pencil box with pencils and pencil sharpener).
The issue in the instant ruling is whether the backpack has a nexus with the plates, cups, knives, forks and spoons such that all are intended to be used together or in conjunction with one another to meet a particular need or carry out a specific activity. It is the conclusion of the Customs Service that the backpack, plates, cups, knives, forks and spoons, as packaged for sale to the user, constitute a set as they carry out the specific activity of serving a picnic in a remote location. The backpack makes it possible for the picnicker to carry all utensils, food, beverages and sundries long distances with relative ease. The backpack with its separate pockets keeps the primary items organized during travel and additionally provides storage when the items are not in use. The plates, cups, knives, forks and spoons make it possible and simpler to serve the picnic meal. Customs additionally notes that the backpack, plates, cups, knives, forks and spoons are color-coordinated.
Having concluded that the backpack, plates, cups, knives, forks and spoons are items in a set put up for retail sale pursuant to GRI 3(a), the classification analysis continues with a review of GRI 3(b). GRI 3(b) provides that goods put up in sets for retail sale which cannot be classified by reference to GRI 3(a) shall be classified as if they consisted of that component of the set which gives the set its “essential character.”
The General Rules of Interpretation do not define the phrase “essential character,” but the Explanatory Notes offer a non-exhaustive list of factors which may be considered. The factors include: (1) The nature of the component; (2) Its bulk; (3) Its quantity; (4) Its weight; (5) Its value; and (6) The role of the component in relation to the use of the goods. See General Rules for the Interpretation of the Harmonized System, Rule 3(b), Explanatory Note (VIII). Explanatory Note (VIII) of GRI 3(b) specifically states that the essential character of a set will “vary between different kinds of goods.” Id.
A review of judicial precedent and prior Customs Service Headquarters Ruling Letters also serves to highlight the meaning of “essential character.” The Court of International Trade in Better Home Plastics Corp. v. United States, 916 F. Supp. 1265 (C.I.T. 1996) referencing United States v. United China & Glass, 293 F. Supp. 734, 737, 61 Cust. Ct. 386 (1968) stated that essential character is that attribute “which is indispensable to the structure, core or condition of the article, i.e. what it is.” Headquarters Ruling Letter 955714, elaborating on the decision in United China, stated that “[i]n general, essential character has been construed to mean that attribute which strongly marks or serves to distinguish what an article is.” See HQ 955714 supra; See also, Pillowtex Corp. v. United States, 171 F.3d 1370 (Fed. Cir. 1999); HQ 951902 supra.
It is the conclusion of the Customs Service that the component of the “cooler backpack / picnic set” which gives the set its “essential character” is the backpack. The particular need or specific purpose that the set serves is the ability to enjoy a picnic in a remote location. The backpack has the indispensable role in this activity. It is the backpack that provides the set with its predominate intrinsic and financial value. See HQ 088323 Id. (declaring the pencil box to constitute the essential character of the set).
HOLDING
The backpack, plates, cups, knives, forks and spoons that comprise the “cooler backpack / picnic set” are a set for the purposes of classification pursuant to the Harmonized Tariff Schedule of the United States Annotated.
The item that affords the set its essential character is the backpack.
The “cooler backpack / picnic set” is classified in subheading 4202.92.4500, HTSUSA, which provides for “…knapsacks and backpacks…Other: With outer surface of sheeting of plastic or of textile materials: Other.”
The General Column 1 Rate of Duty for the “cooler backpack / picnic set” is twenty (20) percent, ad valorem.
Sincerely,
John Durant, Director
Commercial Rulings Division