CLA-2 OT:RR:CTF:TCM H020852 GC
Terrie A. Gleason, Esq.
Baker & McKenzie LLP
815 Connecticut Avenue, NW
Washington, DC 20006-4078
RE: Revocation of NY N011802 and modification of NY N012101; Tariff classification of light sculptures of snowman, reindeer and angel
Dear Ms. Gleason:
This is in response to your letter, dated December 5, 2007, on behalf of your client, Costco Wholesale Corporation (Costco), requesting that we reconsider New York Ruling Letters (NY) N011802 and N012101, both dated June 7, 2007.
Pursuant to section 625(c), Tariff Act of 1930 (19 U.S.C. §1625(c)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed action was published on March 12, 2009, in the Customs Bulletin, Volume 43, No. 11. Three comments were received in support of the notice.
FACTS:
The subject light sculptures, identified as the “Glistening Snowman” (item 663613), “Grapevine Angel” (item 663620), “Standing Reindeer Light Sculpture” (item 663609) (Standing Reindeer), “Feeding Reindeer Light Sculpture” (item 663610) (Feeding Reindeer) and “Snowman Family Light Sculpture Set” (item 663619) (Snowman Family Set), are three-dimensional representations of deer, snowmen or angels composed of a pre-assembled metal frame covered with a string of lights and may include metal stakes. Each item contains an Underwriters Laboratory (UL) tag warning the ultimate purchaser that the items are “[f]or temporary (90 days max) installation and use only.”
The Glistening Snowman is approximately 60 inches tall and is composed of a pre-assembled metal frame covered with PVC tinsel and a string of 450 lights to outline the shape of the frame. The snowman has a green and red striped scarf and a sprig of holly in its blue hat.
The Grapevine Angel also measures approximately 60 inches high, and is composed of a pre-assembled metal and grapevine frame covered with a string of 300 lights that outline the shape of the angel. The angel has a halo and wings and is holding a 5-pointed star.
The Standing Reindeer measures 40 inches tall by 60 inches wide, and resembles a standing buck with its head held aloft.
The Feeding Reindeer is of similar proportions, but the buck’s head is lowered as though it were eating grass.
The Snowman Family Set consists of three different sized of snowman, measuring 60 inches, 48 inches, and 36 inches high respectively. Each snowman is wearing a red and white striped scarf and a hat that contains a sprig of holly.
You indicate in your letters and photograph attachments that Costco sells the light sculptures in the holiday/seasonal aisle of its stores as well as in the “holiday & seasonal – outdoor décor” section of its website. The light sculptures are sold for a limited time, usually taking place over a fourteen week period starting in late August and continuing until December 24th. The light sculptures are not sold after Christmas, as Costco instructs its stores to remove all Christmas related items, including the subject light sculptures, from display no later than December 26th.
In NY N011802, CBP classified the Glistening Snowman and Grapevine Angel under heading 9405, of the Harmonized Tariff Schedule of the United States (HTSUS), as lamps. In NY N012101, CBP classified, in relevant part, the Standing Reindeer, Feeding, and Snowman Family Set under heading 9405, HTSUS, which provides for lamps.
ISSUE:
Whether the subject light sculptures are classified under heading 9405, HTSUS, as lamps, or heading 9505, HTSUS, as festive articles?
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied in order.
The HTSUS provisions under consideration in this case are as follows:
9405 Lamps and lighting fittings including searchlights and spotlights and part thereof, not elsewhere specified or included; illuminated signs, illuminated nameplates and the like, having a permanently fixed light source, and parts thereof not elsewhere specified or included:
9405.40 Other electric lamps and lighting fittings:
Of base metal:
9405.40.6000 Other
* * *
9505 Festive, carnival or other entertainment articles, including magic tricks and other practical joke articles; parts and accessories thereof:
9505.10 Articles for Christmas festivities and parts and accessories thereof:
Christmas Ornaments:
Other:
9505.10.2500 Other
Note 1(l) to chapter 94, HTSUS, states that chapter 94 does not cover:
Toy furniture or toy lamps or lighting fittings (heading 9503), billiard tables or other furniture specially constructed for games (heading 9504), furniture for magic tricks or decorations (other than electric garlands) such as Chinese lanterns (heading 9505).
Note 1(t) to chapter 95, HTSUS, states that chapter 95 does not cover, “[e]lectric garlands of all kinds (heading 9405).”
The Harmonized Commodity Description and Coding System Explanatory Note (EN) to heading 8543, HTSUS, supports this conclusion. In understanding the language of the HTSUS, the ENs may be utilized. The ENs, though not dispositive or legally binding, may provide commentary on the scope of each heading of the HTSUS, and are the official interpretation of the Harmonized System at the international level. CBP believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
The ENs to heading 9505, HTSUS, provide, in pertinent part:
This heading covers:
(A) Festive, carnival or other entertainment articles, which in view of their intended use are generally made of non-durable material. They include:
* * *
(2) Articles traditionally used at Christmas festivities, e.g., artificial Christmas trees, nativity scenes, nativity figures and animals, angels, Christmas crackers, Christmas stockings, imitation yule logs, Father Christmases.
Although all the subject light sculptures incorporate a string of electric lights around a frame, the light sculptures are not electric garlands. See Primal Lite, Inc. v. United States, 15 F.Supp. 2d 915 (1998), aff’d, 182 F.3d 1362 (1999). The articles at issue here form three-dimensional shapes. Such light sculptures are not similar to electric garlands. Accordingly, the above mentioned exclusion note to Chapter 95, HTSUS, does not apply.
In accordance with Note 1(l) to Chapter 94, HTSUS, we must determine if the subject merchandise constitutes “festive articles” within the scope of heading 9505, HTSUS. In Midwest of Cannon Falls v. United States, 122 F.3d 1423 (Fed. Cir. 1997) (Midwest), the court discussed the scope of heading 9505, HTSUS, specifically the class or kind of merchandise termed “festive articles”. In general, merchandise is classified as a festive article in heading 9505, HTSUS, when the article, as a whole:
Is not predominantly of precious or semiprecious stones, precious metal or metal clad with precious metal;
Functions primarily as a decoration or functional item used in the celebration of, and entertainment on, a holiday; and
Is associated with or used on a particular holiday.
See also Park B. Smith, Ltd. v. United States, 347 F.3d 922 (Fed. Cir. 2003)(Park B. Smith).
In addition to the criteria listed above, the Midwest Court considered the general criteria for classification set forth in United States v. Carborundum Company, 63 CCPA 98, C.A.D. 1172, 536 F.2d 373 (1976), cert. denied, 429 U.S. 979 (Carborundum) to determine the principal use of the articles at issue therein. Therefore, with respect to decorative articles related to holidays and symbols not specifically recognized in Midwest or Park B. Smith, CBP will also consider the general criteria set forth in Carborundum to determine whether a particular good belongs to the class or kind “festive articles”. Those criteria include the general physical characteristics of the article, the expectation of the ultimate purchaser, the channels of trade, the environment of sale (accompanying accessories, manner of advertisement and display), the use in the same manner as merchandise which defines the class, economic practicality of so using the import, and recognition in the trade of this use.
The ultimate purchaser of the instant light sculptures in the shapes of reindeer, angels, and snowmen would have the expectation of using the articles to decorate the outside of their home during the holiday season. As you have stated, the environment of sale will be a portion of the store, existing only from late August through Christmas, devoted to displaying Christmas or holiday items. The subject merchandise is available on the Costco website in the same manner. The recognition in the trade would be as Christmas articles. Accordingly, we find the instant reindeer, snowman, and angel light sculptures to be of a class or kind of merchandise which is bought to decorate the home during the Christmas season.
We note that not all reindeer, snowman and angel ornaments are automatically festive, nor will the presence of other Christmas-related images automatically qualify the articles for classification as a festive article. This is the case because the images may appear with articles that are inconsistent with festive use. Likewise, the mere appearance of articles in a Christmas catalogue is not sufficient to bring the article into the class of festive articles; however, such an appearance is useful evidence toward that end. See Headquarters Ruling Letter (HQ) 963198, dated September 26, 2000 (citing HQ 961839, dated March 9, 1999). The subject light sculptures satisfy the above-referenced standard in the sense that the Carborundum factors, taken together, lead to the conclusion that the subject reindeer, snowman and angel light sculptures are within the same class of merchandise principally used during Christmas.
Indeed, CBP has considered certain light sculptures utilized during Christmas as recognized symbols of the Christmas holiday to be classifiable in heading 9505. See HQ 963198; HQ 962965, dated November 9, 1999; NY R02191, dated February 16, 2005; NY R01191, dated January 12, 2005; NY K86401, dated June 14, 2004; and NY H87842. The instant light sculptures are classifiable as festive articles of heading 9505, HTSUS. They are excluded from Chapter 94, HTSUS, by Note 1(l) to Chapter 94, HTSUS.
HOLDING:
By application of GRI 1, the subject light sculptures are classified in heading 9505, HTSUS, as festive articles, and they are specifically provided for in subheading 9505.10.25, HTSUS, which provides for: “[f]estive, carnival or other entertainment articles, including magic tricks and other practical joke articles…: Christmas ornaments: [o]ther: [o]ther.” The column one, general rate of duty is free.
Duty rates are provided for your convenience and subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at www.usitc.gov/tata/hts/.
EFFECT ON OTHER RULINGS:
NY N011802, dated June 7, 2007 is hereby REVOKED. NY N012101, dated June 7, 2007, is hereby MODIFIED.
In accordance with 19 U.S.C. §1625(c), this ruling will become effective 60 days after its publication in the Customs Bulletin.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division