CLA-2 OT:RR:CTF:TCM H173039 RES
U.S. Customs and Border Protection
Service Port – Otay Mesa
9777 Via De La Amistad
San Diego, CA 92154
ATTN: Janet Ayers, Import Specialist
RE: Internal Advice Request; Tariff classification of a waist belt with pouches and plastic bottle set
Dear Port Director:
You requested internal advice on June 21, 2011, with regard to the tariff classification of CamelBak “Delaney” brand waist belt hydration systems (“the Delaney belt(s)”) under the Harmonized Tariff Schedule of the United States (“HTSUS”). This letter responds to your request.
FACTS:
The articles at issue in this request for internal advice are waist belts that have small storage pouches and plastic water bottles that fit into their own holder. The importer provided three different models of the Delaney belts as samples for examination: the “Delaney Fit”, “Delaney Plus”, and “Delaney Race”. All three consist of textile material with a laminate mesh covering, reflective strips of material on the belts, and all have plastic twenty-four ounce water bottles that have a spout and fit into their own bottle holding pouch.
The Delaney Fit model has a single twenty-four ounce (.71L) water bottle and a single small mesh pouch with a carrying capacity of .75 liters that is designed for carrying small items such as keys, phone, and energy bar.
The Delaney Plus model has a single twenty-four ounce water bottle and one five ounce fluid bottle (.86L total capacity). Both bottles fit into their own dedicated holders. This model has two small cargo carrying pouches that have a total combined capacity of 1.64L. Both pouches are designed for carrying an energy bar, gel, cash, keys, and media player.
The Delaney Race model has a single twenty-four ounce water bottle and two five ounce fluid bottles, of which these bottles all fit into their own dedicated holders (1L total capacity). This model has only one small cargo carrying pouch (.75L) that is enclosed (there is no mesh pouch with this model) and is used for carrying an energy bar, gel, cash, and keys.
The textile belts and plastic bottles are imported together as a set and sold at retail as a belt and bottle set. CamelBak markets the articles for use during activities such as running, hiking, etc. The articles’ hang tags also show the figures for hiking and running.
ISSUE:
Whether the essential character of the Delaney belts is imparted by the plastic bottles classified under heading 3924, HTSUS, as household articles, or under heading 3926, HTSUS, as other articles of plastic, or by the belt under heading 4202, HTSUS, as a container similar to a travel and sports bag?
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRI). GRI 1 provides that the classification of goods shall be “determined according to the terms of the headings 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 GRI 2 through 6 may be applied in order.
The following HTSUS provisions are under consideration:
3924 Tableware, kitchenware, other household articles and hygienic or toilet articles, of plastics:
3926 Other articles of plastics and articles of other materials of headings 3901 to 3914:
4202 Trunks, suitcases, vanity cases, attaché 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:
In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System, which constitute the official interpretation of the Harmonized System 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 importer asserts that the Delaney belts are composite articles because they are composed of a textile waist belt and a plastic bottle, and that under a GRI 3(b) analysis, it is the plastic bottle that provides the essential character of the overall article, and hence, the Delaney belts are classifiable under either 3924, HTSUS, or 3926, HTSUS, depending on the classification of a plastic sports water bottle. In the alternative, the importer argues, citing to NY N110378, dated July 15, 2010, and NY N113681, dated August 4, 2010, that Delaney belts are not composite articles and their individual components—the belt and the bottle—should be classified separately.
Analyzing the Delaney belts first under GRI 1, there is no specific provision in the HTSUS that completely describes these types of products. Likewise, the Delaney belts are not classifiable under GRI 2(a) or 2(b) because the articles are not in an unassembled or incomplete state, but are imported as complete articles as goods put up in sets for retail sale consisting of components which are classifiable under two or more headings. GRI 2(b) instructs that “[t]he classification of goods consisting of more than one material or substance shall be [determined] according to the principles of rule 3.”
GRI 3(a) does not apply because there is no heading that provides a specific description that clearly identifies the Delaney belts; goods consisting of a textile belt with cargo pouches and plastic water bottles. Thus, the articles at issue are analyzed under GRI 3(b), because they are goods sold at retail together consisting of different components each of which, if imported separately, would be classifiable under different headings.
The Delaney belts meet the requirements to be considered a “retail set” for GRI 3(b) purposes. As the Court of International has comprehensively explained in Estee Lauder Inc. v. United States, 815 F. Supp. 2d 1287, 1297-1301 (Ct. Int’l Tr. 2012), for merchandise to qualify as “goods put up in sets for retail sale”, they must meet the following requirements listed in EN(X) to GRI 3(b): (1) consist of at least two different articles which are prima facie classifiable in different headings; (2) meet a particular need or carry out a specific activity; and (3) be put up in a manner suitable for sale directly to users without repacking. The Delaney belts meet all these requirements as; the textile belts and the plastic water bottles are classified under two different headings; the set is for the specific activity of providing hydration during engagement in physical activities; and the set is put up for sale directly to users without repacking. Thus, the Delaney belts are analyzed as retail sets for classification purposes.
According to GRI 3(b), “mixtures . . . goods put up in sets for retail sale . . . shall be classified as if they consisted of the material or component which gives them their essential character . . . .” Therefore, to determine under which heading to properly classify an entire Delaney belt article, we must determine which component gives the article its essential character: the textile belt with pouches or the plastic bottles.
Although the GRI’s do not provide a definition of “essential character,” the EN (VIII) of GRI 3(b) provides guidance. According to this EN, the essential character may “. . . 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.” This is known as the “essential character test” and the application of this test requires a fact-intensive analysis. Home Depot U.S.A., Inc. v. United States, 491 F.3d 1334, 1337 (Fed. Cir. 2007). Many factors should be considered when determining the essential character of an article, including but not limited to those factors enumerated in Explanatory Note (VIII) to GRI 3(b). Id.
(1) & (2) Bulk and Weight of the Components. Upon close examination of the physical samples provided, the plastic water bottles, in comparison to the textile belts and pouches, appear to comprise a slightly greater share of the bulk of the sets of articles, but the textile belts and pouches appear to be slightly heavier than the plastic bottles when compared by holding the components in one’s hands.
(3) Quantity of Components. Depending on the Delaney belt models there are either one or up to three plastic bottles, which fit into pouches sewn in on a single textile belt, while there are between one to two cargo pouches on the belts depending on the model. The fact that there is either the same number of plastic bottles to cargo pouches or more plastic bottles than pouches coupled with the fact that there are multiple plastic bottles on some of the models is a clear indicator that the function of the overall article is to store and dispense liquids. This factor weighs in favor of the plastic bottles providing the essential character of this function.
(4) Value of the Components. There is no break down of the individual costs of each component. Thus, this factor is not helpful in determining essential character.
(5) Roles of the Components. Although each component contributes to the overall functions of the article, the plastic water bottles directly store, transport, and dispense fluids. The belt only transports the bottles along with holding small personal items. Without the textile belt, the plastic water bottles can still store and dispense water, although they would be not as conveniently transportable. However, the reverse is not true. The textile belt, on its own without the plastic bottles (or any bottle) can neither dispense nor store a liquid without some sort of container storing and supplying the liquid. Furthermore, CamelBak lists on their website the hydration capacity first for all its brand of Delaney belts, further indicating that the primary purpose of the belts is portable hydration for a person is engaged in physical activity, while the carrying of small cargo items is subordinate to the transportation of liquids.
Also of note is the fact that for two of the three Delaney belt models—the Delaney Fit and the Delaney Race—the liquid holding capacity and cargo carrying capacity are either the same or has more liquid carrying capacity. Although the Delaney Plus model has almost twice as much volume of cargo carrying capacity than liquid, the overall cargo capacity is not substantial because it is broken up into two separate pouches for small articles, while the volume of liquid carrying capacity is consistently within a particular range (.75L to 1L) for engaging in physical activity. Thus, this factor weighs in favor of the plastic bottles.
(6) Nature of the Components. Bottles, made of whatever material and with a spout, are by their very nature, used to store and dispense liquids. A belt, which holds other objects such as bottles, is an article that provides a carry and transport function for convenience. In comparing the two types of components, it is the nature of the plastic bottles that contributes most to the overall function and primary purpose of the Delaney belt articles, which is to provide hydration during engagement in physical activities.
Thus, in consideration of all these factors, it is the plastic bottle(s) that impart the essential character of the textile belt and plastic bottle sets. All three models of Delaney belts are classified according to the classification of the plastic sports water bottles under the HTSUS.
A plastic water bottle is considered a sports bottle, and is classifiable under heading 3926, HTSUS, if it is designed for use primarily away from the home, which can be indicated by whether the plastic bottle has a fitted carrying case and features such as a spout that permits drinking without removing the cap. See HQ 960373, dated February 8, 1999; HQ 967178, dated August 24, 2004; NY D83619, dated November 12, 1998; NY E83239, dated July 15, 1999; NY G84130, dated November 20, 2000; NY H82253, dated June 18, 2001; NY R03926, dated May 18, 2006; N110378, dated July 15, 2010; and NY N120856, dated September 24, 2010. The plastic bottles that come with the Delaney belts meet these requirements as the bottle holding pouches on the belt are designed to hold the bottles that are in them, the bottles have spouts that are easy to drink from while engaged in an activity, and the bottles are meant to be used away from the household while running or engaged in some other physical activity. See NY R03382, dated March 16, 2006 (classifying a hydration belt under heading 3926, HTSUS); and NY M83383, May 18, 2006 (classifying a hydration belt with six water bottles under heading 3926, HTSUS).
Therefore, the three models of the Delaney brand of waist belt hydration systems at issue here are classifiable under heading 3926, HTSUS, as “[o]ther articles of plastics and articles of other materials of headings 3901 to 3914.”
HOLDING:
Pursuant to GRI 3(b), the three models of the Delaney brand waist belt hydration systems are classified under subheading 3926.90.9980, HTSUSA, as “[o]ther articles of plastics and articles of other materials of headings 3901 to 3914: [o]ther: [o]ther: [o]ther.” The column one, rate of duty, is 5.3 percent ad valorem.
Duty rates are provided for your convenience and are 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/.
You are to mail this decision to the internal advice requestor no later than sixty days from the date of the decision. At that time, Regulations and Rulings of the Office of International Trade 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