CLA-2 OT:RR:CTF:TCM H066457 TNA
Port Director, Los Angeles Service Port
U.S. Customs and Border Protection
11099 South La Cienega Blvd. Los Angeles, CA 90045
Re: Application for Further Review of Protest No: 2720-09-100287; classification of silver coins
Dear Port Director:
The following is our decision regarding the Application for Further Review (“AFR”) of Protest No. 2720-09-100287, timely filed on May 27, 2009, on behalf of Panda America Corporation (“Panda”). The AFR concerns the classification of silver coins under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
The subject merchandise consists of silver commemorative coins from China that are issued by government mints and released through official channels. They have a face value and may be used to purchase goods, although the coins are unlikely to be used as such because of their collectors’, or commemorative, value. These coins are intended to be collected.
The subject merchandise also consists of presentation boxes designed to hold coins. The boxes measure approximately 3”x3.5”. Their exterior consists of rigid paperboard covered with plastic leatherette and an interior made of textiles. The bottom half of the boxes contain a circular indent in which to display a coin. The boxes were imported separately from the coins. Customs and Border Protection (“CBP”) has received and examined a sample of these boxes.
This protest covers five entries into the Los Angeles Service Port under heading 7114, HTSUS. The merchandise entered on November 29, 2007, January 28, 2008, January 29, 2008, and July 25, 2008. CBP liquidated the entries on November 28, 2008, and December 5, 2008, and December 12, 2008.
ISSUE:
Whether commemorative coins possessing a face value and issued from government mints should be classified under heading 7114, HTSUS, as articles of goldsmiths and silversmiths, or under heading 7118, HTSUS, as coins?
Whether a presentation box for displaying coins should be classified under heading 4202, HTSUS, as a display box?
LAW AND ANALYSIS:
Initially, we note that the matter protested is protestable under 19 U.S.C. §1514(a)(2) as a decision on classification. The protest was timely filed, within 180 days of liquidation for entries made on or after December 18, 2004. (Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2)(B)(ii), (iii) (codified as amended at 19 U.S.C. § 1514(c)(3) (2006)).
Further Review of Protest No. 2720-09-100287 is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(c) because the decision against which the protest was filed is alleged to involve specific factual and legal questions that have not been the subject of a Headquarters ruling or court decision. Specifically, protestant argues that the protest involves matters on which CBP has previously ruled, but that there are facts that are alleged or legal arguments presented which were not considered at the time of previous rulings.
Merchandise imported into the United States is classified under the HTSUS. Tariff classification is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context which requires otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provisions of law for all purposes.
GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in their appropriate order. GRI 6 requires that the classification of goods in the subheadings of headings shall be determined according to the terms of those subheadings, any related subheading notes and, mutatis mutandis, to GRIs 1 through 5.
The HTSUS headings under consideration are the following:
4202 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, insulated food or beverage 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 or mainly covered with such materials or with paper (con.):
Other:
4202.92 With outer surface of sheeting of plastic or of textile materials:
Other:
4202.92.90 Other
4202.92.9060 Other
7114 Articles of goldsmiths' or silversmiths' wares and parts thereof, of precious metal or of metal clad with precious metal:
Of precious metal whether or not plated or clad with precious metal:
7114.11 Of silver, whether or not plated or clad with other precious metal:
7114.11.7000 Other
7118 Coin:
7118.90.00 Other
Gold:
In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System (HS), which constitute the official interpretation of the HS at the international level, may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989).
The EN for heading 7114 states, in pertinent part, the following:
This heading covers articles of goldsmiths’ or silversmiths’ wares as defined in Note 10 to this Chapter wholly or partly of precious metal or metal clad with precious metal. In general these goods are larger than articles of jewellery of heading 71.13…
The heading also covers unfinished or incomplete articles of goldsmiths’ or silversmiths’ wares and identifiable parts of goldsmiths’ or silversmiths’ wares, for example, silver handles for tableware, silver backs for toilet brushes, etc.
Like jewellery and subject to the same reservation as regards minor constituents, the goods of this heading must contain precious metal or metal clad with precious metal; they may also contain pearls (natural, cultured or imitation) precious or semi-precious stones (natural, synthetic or reconstructed), imitation stones, tortoise-shell, mother of pearl, ivory, amber (natural or agglomerated), jet or coral.
The EN for heading 7118 states, in pertinent part, the following:
This heading applies to coins of any metal (including precious metals) of officially prescribed weight and design, issued under government control for use as legal tender. Consignments of individual coins or of sets of coins which are legal tender in the country of issue are classified in this heading even if they are put up for general sale in presentation cases. The heading includes coin which is no longer legal tender but it excludes collectors’ pieces (see Explanatory Note to heading 97.05).
Coins are provided for, eo nomine, in heading 7118, HTSUS. As described by the EN to heading 7118, however, the scope of the heading includes coins issued by government control that is legal tender. As such, the subject merchandise’s classification also hinges on whether the coins meet the definition of “legal tender.”
The phrase “legal tender” is not defined in either the tariff headings or the ENs, so CBP is permitted to draw on dictionaries and other lexicographic materials. See, e.g., Lonza v. United States, 46 F.3d. 1098; 1995 U.S. App. LEXIS 1821; 16 Int’l Trade Rep (BNA) 2551. The Oxford English Dictionary defines “legal tender” as “coin or other money, which a creditor is bound by law to accept, when tendered in payment of a debt.” According to Webster’s College Dictionary, “legal tender” is “money that may be legally offered in payment of an obligation and that a creditor must accept.” According to a numismatic dictionary, non-circulating legal tender is “a coin struck by the national issuing authority mainly to be sold to collectors. The coins also have a face value and can be spent in the country of issue.” See http://www.predecimal.com/dictionary. htm.
In the past, CBP has classified commemorative coins such as the instant merchandise in heading 7118, HTSUS. See, e.g., NY N016199, dated September 11, 2007. In addition, the EN to heading 7118, HTSUS, states that “consignments of individual coins or of sets of coins which are legal tender in the country of issue are classified in this heading even if they are put up for general sale in presentation cases.”
In the present case, the subject coins are issued by government mints in China and are released through official channels. As a result, they are released by a recognized monetary authority. Panda’s submission states that the coins have a face value and may be used to pay for purchases, even if they are intended to be collected rather than to pay for purchases. The company also states that the coins fit the numismatic definition of non-circulating legal tender because of their ability to be used to pay for purchases even if they are not intended for general use as a medium of exchange. As a result, CBP finds that the subject merchandise meets the requirements of heading 7118, HTSUS, and will be classified there.
Lastly, Panda imported presentation boxes that are also at issue in this protest. Although the presentation boxes can be used to display the coins at issue, they were imported separately from the coins. Furthermore, the coins are not always packaged with the coins for sale to the consumer. Therefore, CBP will classify the presentation box separately from the coins. CBP has long classified similar presentation boxes under subheading 4202.92.9060. See, e.g., NY F85791, dated April 17, 2000 (a storage/display case for commemorative of paperboard base with an exterior of fabric backed compact plastic sheeting and an interior specially shaped and fitted to contain coins); NY 862417, dated May 7, 1991; NY L83384, dated April 11, 2005. As a result, the presentation box is classified in subheading 4202.92.9060, HTSUS, which provides for “trunks, suitcases,…; traveling bags, … jewelry boxes, powder cases, cutlery cases and other similar containers… of textile materials, other: other: other: other.”
HOLDING:
By application of GRI 1, the silver coins from China are classified in heading 7118, HTSUS, and specifically under subheading 7118.90.0055, HTSUS, which provides for “coin: other: other.” The general, column one rate of rate is Free.
The presentation boxes are classified in heading 4202, HTSUS, and specifically in subheading 4202.90.9060, which provides for: “trunks, suitcases,…; traveling bags, … jewelry boxes, powder cases, cutlery cases and other similar containers… of textile materials, other: other: other: other.” The general, column one rate of duty is 17.6% ad valorem.
You are instructed to ALLOW the protest in part, and DENY it in part.
In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP Form 19, to the protestant no later than 60 days from the date of this letter.
Sixty days from the date of the decision, the Office International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division