OT:RR:CTF:TCM H080818 PTM
TARIFF NO: 3926.90.9980
Mr. Richard J. Hartenstine
F.W. Myers & Co. Inc.
149-09 183 Street
Jamaica, NY 11413-4030
RE: Revocation of NY 888345, dated August 10, 1993, NY C84082, dated February 27, 1998, and NY 885120, dated May 12, 1993. Tariff classification of an anti-theft device with an ink cartridge.
Dear Mr. Hartenstine,
On August 10, 1993, we issued New York (NY) Ruling 888345 in response to your request for a ruling concerning the tariff classification of an anti-theft device with an ink cartridge. In NY 888345, we determined that the proper tariff classification of the anti-theft device under the Harmonized Tariff Schedule of the United States (“HTSUS”) was under heading 3215.90, which provides for “Printing ink, writing or drawing ink and other inks, whether or not concentrated or solid: Other.” We have reviewed NY 888345 and found it to be in error. For the reasons set forth below, we hereby revoke NY 888345 several other rulings on substantially similar merchandise: NY C84082 (Feb. 27, 1998), and NY 885120 (May 12, 1993).
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. § 1625 (c)(1)), 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), a notice was published in the Customs Bulletin, Volume 49, No. 35, on September 2, 2015, proposing to revoke NY 888345, NY C84082 and NY 885120 and any treatment accorded to substantially identical transactions. No comments were received in response to this notice.
FACTS:
In NY 888345 we described the anti-theft device as follows:
The prospective import is a Colored Pin (Ink Anti-Theft Device) for preventing of the theft of clothes. The device is composed of a plastic capsule which is approximately 1 1/2 inches in diameter by 5/8 inch thick. It is filled with red ink. The ink capsule is attached with a steel pin to clothing or other items in department stores. If unauthorized persons try to remove the pin, the ink will leak onto the clothing.
The anti-theft devices are used by retailers to prevent shoplifters from stealing merchandise. The retailers affix the devices to garments with a locking clamp, and the devices can only be removed with a specially designed detaching tool. If a person attempts to remove the device without the detaching tool, a tack in the device will break the vial of ink and ruin the garment. The device is designed to work as both a visual and functional deterrent.
ISSUE:
Are the anti-theft devices properly classified under heading 3215 HTSUS as “other inks” or in heading 3926 HTSUS as “other articles of plastics”?
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (“GRI’s”). 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. 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 the GRIs 1 through 5.
The Explanatory Notes (EN) to the Harmonized Commodity Description and Coding System represent the official interpretation of the tariff at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The HTSUS provisions at issue are as follows:
3215 Printing ink, writing or drawing ink and other inks, whether or not concentrated or solid:
3215.90 Other:
* * *
3926 Other articles of plastics and articles of other materials of headings 3901 to 3914:
3926.90 Other:
The anti-theft device consists primarily of two components: a plastic shell housing and an ink capsule. Because the anti-theft device is a composite good, it must be classified pursuant to GRI 3, which states, in pertinent part:
When, by application of rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows:
* * *
(b) Mixtures, composite goods consisting of 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.
Regarding the determination of which component imparts the instant anti-theft device with its essential character, the EN (VIII) to GRI 3(b) states the following:
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.
GRI 3(b) requires that classification be based on the component that provides the article with its essential character. As noted above, EN (VIII) to GRI 3(b) provides that when performing an essential character analysis, the factors that should be considered are the bulk, quantity, weight or value, or the role of a constituent material in relation to the use of the goods. There have been several court decisions on "essential character" for purposes of classification under GRI 3(b). See, e.g., Conair Corp. v. United States, 29 C.I.T. 888 (2005); Structural Industries v. United States, 360 F. Supp. 2d 1330, 1337-1338 (Ct. Int’l Trade 2005); and Home Depot USA, Inc. v. United States, 427 F. Supp. 2d 1278, 1295-1356 (Ct. Int’l Trade 2006), aff’d 491 F.3d 1334 (Fed. Cir. 2007). “[E]ssential character is that which is indispensable to the structure, core or condition of the article, i.e., what it is.” Home Depot USA, Inc. v. United States, 427 F. Supp. 2d at 1293 quoting A.N. Deringer, Inc. v. United States, 66 Cust. Ct. 378, 383 (1971). In particular, in Home Depot USA, Inc. v. United States, the court stated “[a]n essential character inquiry requires a fact intensive analysis.” 427 F. Supp. 2d 1278, 1284 (Ct. Int’l Trade 2006). Therefore, a case-by-case determination on essential character is warranted in this situation.
The ink capsule of the anti-theft device is enclosed within the plastic shell housing, which is clamped onto the garment. The plastic shell is the only visible component of the anti-theft device. The shell prevents the ink cartridge from breaking and ruining the merchandise unless the device is tampered with. Additionally, the plastic shell housing accounts for the majority of the bulk and weight of the anti-theft device. The primary function of the anti-theft device is to prevent shoplifters from stealing garments. The plastic shell housing serves as a physical and visual deterrent to would-be shoplifters. The anti-theft device is visible on the garments onto which it is affixed. Furthermore, the garments are unusable if the device is not removed using the removal tool. The ink housed in the plastic shell is an additional deterrent, however, it is incapable of operating on its own. By contrast, the plastic shell housing can function as a theft deterrent without the ink cartridge. Thus, the role of the plastic shell housing is indispensable to the use of the device. Based on the analysis of these factors, we find that the plastic shell housing provides the merchandise with its essential character. Therefore, based on the information available, the merchandise is properly classified as an article of plastic under heading 3926 HTSUS.
Prior CBP rulings have classified similar anti-theft devices in heading 3926 HTSUS. For example, in HQ 082561 (Nov. 25, 1988), the legacy Customs Service classified Colortag anti-shoplifting device under heading 3926 HTSUS. Similarly, in NY N801735 (Sept. 28, 1994), Customs classified an anti-theft device consisting of a plastic shell containing ink under heading 3926 HTSUS. See also, NY 868503 (Nov. 11, 1991), NY 855458 (Aug. 29, 1990). Consequently, our holding is consistent with prior rulings.
HOLDING:
By application of GRI 3(b), the anti-theft tag is classified in heading 3926 HTSUS, more specifically in subheading 3926.90.9995, which provides for “Other articles of plastics and articles of other materials of headings 3901 to 3914: Other: Other.” The 2015 column one, general rate of duty, is 5.3 percent ad valorem.
Duty rates are provided for convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at http://www.usitc.gov/tata/hts/.
EFFECT ON OTHER RULINGS:
NY 888345 (Aug. 10, 1993), NY C84082 (Feb. 27, 1998), and NY 885120 (May 12, 1993) are hereby REVOKED.
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