CLA-2 OT:RR:CTF:TCM H076999 TNA
Port Director
Port of Portland
U.S. Customs and Border Protection
P.O. Box 55580 Portland, OR 97238-5580
RE: Application for Further Review of Protest No. 2904-09-100040; Classification of Glow Sticks with Connectors
Dear Port Director:
The following is our decision regarding Application for Further Review (“AFR”) of Protest No. 2904-09-100040, timely filed on June 30, 2009, regarding classification of glow sticks with connectors under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
The subject merchandise consists of plastic sticks that contain a mixture of chemicals inside them. The chemical mixtures come in a range of colors- clear, yellow, orange, purple, green, etc. They are activated by bending the sticks, and when activated, begin to glow. The sticks are imported in packages that include plastic connectors that allow the sticks to be fashioned into a range of items, such as bracelets, necklaces, Frisbees, toy handcuffs, etc. Samples of the subject merchandise were received and examined by our office. A portion of these samples was sent to a U.S. Customs and Border Protection (“CBP”) laboratory for an analysis that showed that the chemical makeup of the mixture inside the plastic contains more than 5% aromatic compounds.
The subject merchandise entered the Port of Portland between March 22, 2008 and July 22, 2008 under subheading 7117.90.90, HTSUS, which provides for “Imitation jewelry: Other: Other: Valued not over 20 cents per dozen pieces or parts: Other: Other.” CBP liquidated the merchandise as entered between February 6, 2009 and June 5, 2009. The importer filed its protest on June 30, 2009, claiming classification in subheading 7117.90.60, HTSUS, as toy jewelry. The AFR was filed by the Protestant on August 24, 2009.
ISSUE:
Whether glow sticks that can be fashioned into bracelets, necklaces, and a range of other items should be classified under subheading 7117.90.9000, HTSUS, as items of imitation jewelry; under subheading 7117.90.6000, HTSUS, as toy jewelry; or under heading 3824, HTSUS, as chemical products and preparations of the chemical or allied industries, not elsewhere specified or included?
LAW AND ANALYSIS:
The matter protested is protestable under 19 U.S.C. §1514(a)(2) as a decision on classification and duty rate. The protest was timely filed, within 180 days of the date of liquidation of the entries. (Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2)(B) (codified as amended at 19 U.S.C. § 1514(c)(3) (2006)).
Further Review of Protest No. 2904-09-100040 is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(a), because the decision against which the protest was filed is alleged to be inconsistent with a ruling of the Commissioner of Customs or his designee, or with a decision made at any port with respect to the same or substantially similar merchandise. Specifically, Protestant argues that the liquidation is inconsistent with an approved protest and two post entry amendments in the Port of Norfolk, Virginia and three post entry amendments in the port of San Francisco, California. Protestant filed its protest on the disputed entries in a timely manner, but filed for AFR separately. As a result, the requested AFR on three entries, two liquidated on February 6, 2009 and one liquidated February 13, 2009, was untimely. As a result, we address the legal issues raised in the AFR with respect to the last four entries only.
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.
The 2008 HTSUS headings under consideration are the following:
3824 Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included:
7117 Imitation jewelry
Note 9 to Chapter 71, HTSUS, states, in relevant part:
For the purposes of heading 7113, the expression “articles of jewelry” means:
(a) Any small objects of personal adornment (for example, rings, bracelets, necklaces, brooches, earrings, watch chains, fobs, pendants, tie pins, cuff links, dress studs, religious or other medals and insignia); and
(b) Articles of personal use of a kind normally carried in the pocket, in the handbag or on the person (for example, cigar or cigarette cases, snuff boxes, cachou or pill boxes, powder boxes, chain purses or prayer beads).
* * *
Note 11 to Chapter 71, HTSUS, states:
For the purposes of heading 7117, the expression “imitation jewelry” means articles of jewelry within the meaning of paragraph (a) of note 9 above (but not including buttons or other articles of heading 9606, or dress combs, hair slides or the like, or hairpins, of heading 9615), not incorporating natural or cultured pearls, precious or semiprecious stones (natural, synthetic or reconstructed) nor (except as plating or as minor constituents) precious metal or metal clad with precious metal.
In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System 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 to heading 3824, HTSUS, states, in pertinent part, the following:
* * *
(B) CHEMICAL PRODUCTS AND CHEMICAL OR OTHER PREPARATIONS
With only three exceptions (see paragraphs (7), (19) and (31) below), this heading does not apply to separate chemically defined elements or compounds.
The chemical products classified here are therefore products whose composition is not chemically defined, whether they are obtained as by products of the manufacture of other substances (this applies, for example, to naphthenic acids) or prepared directly.
The chemical or other preparations are either mixtures (of which emulsions and dispersions are special forms) or occasionally solutions. Aqueous solutions of the chemical products of Chapter 28 or 29 remain classified within those Chapters, but solutions of these products in solvents other than water are, apart from a few exceptions, excluded therefrom and accordingly fall to be treated as preparations of this heading.
The preparations classified here may be either wholly or partly of chemical products (this is generally the case) or wholly of natural constituents (see, for example, paragraph (23) below).
* * *
Subject to the above conditions, the preparations and chemical products falling here include:
* * *
(35) Articles producing a lighting effect by the phenomenon of chemiluminescence, e.g., lightsticks in which the lighting effect is obtained by a chemical reaction between oxalic acid type esters and hydrogen peroxide in the presence of a solvent and a fluorescent compound.
The EN to heading 7117, HTSUS, states, in relevant part, the following:
For the purposes of this heading, the expression imitation jewellery, as defined in Note 11 to this Chapter, is restricted to small objects of personal adornment, such as those listed in paragraph (A) of the Explanatory Note to heading 71.13, e.g., rings, bracelets (other than wrist-watch bracelets), necklaces, ear-rings, cuff-links, etc., but not including buttons and other articles of heading 96.06, or dress combs, hair-slides or the like, and hair-pins of heading 96.15, provided they do not incorporate precious metal or metal clad with precious metal (except as plating or as minor constituents as defined in Note 2 (A) to this Chapter, e.g., monograms, ferrules and rims) nor natural or cultured pearls, precious or semi-precious stones (natural, synthetic or reconstructed).
Protestant argues for classification in subheading 7117.90.6000, HTSUS, as toy jewelry. While toy jewelry is not defined in the tariff headings, legal notes or ENs, the definitions provided in Notes 9 and 11 to Chapter 71, HTSUS, and quoted above, show that imitation jewelry attempts to appear like real jewelry that contains, for example, precious or semi-precious stones or precious metal. Imitation jewelry may also contain the types of “jewelry findings” that characterize real jewelry, such as clasps, ear wires, and so forth that characterize jewelry. The subject merchandise, by contrast, is not similar to any examples of jewelry found in Notes 9 and 11. It does not contain ornaments or imitation gemstones of plastic or glass. It does not contain any of the “jewelry findings” that characterize real or imitation jewelry. As a whole, it is not the type of decorative objects that are classified in heading 7117, HTSUS.
CBP has consistently construed heading 7117, HTSUS, as a use provision. See, e.g., HQ 960822, dated June 17, 1998. HQ 960822 examined substantially similar merchandise and found it could be used as napkin rings, table center pieces, and streamers, among other things. “The light sticks can be used in many ways and are not dedicated to a principal use as would be required for classification in heading 7117, HTSUS,” the ruling stated. Id. In the present case, the subject merchandise is nearly identical to the merchandise in HQ 960822. Furthermore, Protestant concedes that “in addition to being worn as bracelets,” the subject merchandise “may be linked together or individually used as a Frisbee throw toy,… linked and used as toy handcuffs, and provide entertainment value in a variety of other uses.” See Protestant’s submission at page 3. As a result, the subject merchandise has other uses besides jewelry and cannot be classified in heading 7117, HTSUS.
In the present case, the subject merchandise’s plastic outer coating contains the chemical mixture and provides the merchandise with its overall length and shape. At the same time, however, it is the chemical mixture that glows when activated. Thus, the subject merchandise is not completely described by any one heading. To the contrary, it contains different components that are classified under different headings. The subject merchandise’s plastic outer coating and its inner chemical mixture form an inseparable whole. As a result, they form a composite good under GRI 3(b).
GRI 3(b) directs that composite goods must be classified according to their essential character. In addition, several court decisions have looked to the role of the constituent materials or components in relation to the use of the goods to determine essential character. Structural Industries v. United States, 360 F. Supp. 2d 1330, 1337-1338 (CIT 2005); Conair Corp. v. United States, 29 C.I.T. 888 (2005); Home Depot USA, Inc. v. United States, 427 F. Supp. 2d 1278, 1295-1356 (CIT 2006), aff’d 491 F.3d 1334 (Fed. Cir. 2007).
GRI 3(b) states:
When by application of Rule 2(b) or for any other reason, goods are prima facie classifiable under two different headings, classification shall be effected as follows:
Mixtures, composite goods consisting or 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.
The ENs to GRI 3(b) state, in relevant part, the following:
(VII) The factor which determines essential character will vary as between different kinds of goods. It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.
(IX) 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.
The chemical mixture inside the plastic tubing provides the entire item with its novelty. Without the chemical mixture, the item would simply be a plastic tube with little marketability. As a result, we find that the chemical mixture imparts the merchandise’s essential character. As such, the subject merchandise is classified in heading 3824. Because laboratory analysis shows that the mixture contained more than 5% by weight of aromatic substances, the subject merchandise is classified in subheading 3824.90.2800, which provides for “chemical products and preparations of the chemical
or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included… Mixtures containing 5 percent or more by weight of one or more aromatic or modified aromatic substances: other.” This is consistent with a long line of prior CBP rulings. See, e.g., HQ 960822 June 17, 1998; NY D84614, dated January 14, 1999; NY H89510, dated March 25, 2002; NY M81230, dated March 21, 2006.
HOLDING:
By application of GRI 3(b), the Glow Sticks with Connectors are classified in heading 3824, HTSUS, and specifically in subheading 3824.90.2800, HTSUS, which provides for: “chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included: Other: Other: Mixtures containing 5 percent or more by weight of one or more aromatic or modified aromatic substances: other.” The general, column one duty rate at the time of entry was 6.5%.
You are instructed to deny the protest except to the extent reclassification of the merchandise as indicated above results in a net duty reduction and partial allowance.
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. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.
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