CLA-2 OT:RR:CTF:TCM H258442 HvB
Robert J. Leo
Meeks, Sheppard, Leo & Pillsbury
570 Lexington Avenue
New York, NY 10022
RE: Reconsideration of HQ H241405; Tariff Classification of Beaded Glass Tree
Dear Mr. Leo:
This letter is in response to your letter of September 19, 2014, in which you request reconsideration of Headquarters Ruling Letter (HQ) H241405, dated May 9, 2014, which was issued to your client, Mr. Christmas, Inc. (“Mr. Christmas”), as it pertains to the tariff classification of a beaded glass tree under the Harmonized Tariff Schedule of the United States (HTSUS). In that ruling, U.S. Customs and Border Protection ("CBP") classified a beaded cone-shaped glass tree in heading 7013, HTSUS, which provides for: “Glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes (other than that of heading 7010 or 7018.” In your request for reconsideration, you assert that the instant glass article is classified in heading 9505, HTSUS, which provides for “Festive, carnival or other entertainment articles, including magic tricks and practical joke articles; parts and accessories thereto”. On November 4, 2014, you electronically mailed to us a supplemental submission, which is addressed herein. On July 28, 2016, members of my staff met with you and your client. This decision responds to views that you presented during that meeting. We affirm HQ H241405 because the glass cone-shaped tree is not prima facie classifiable as a “festive, carnival, or other entertainment article” in heading 9505, HTSUS.
The subject merchandise consists of five tapered glass cones that measure 13.5” in height and 3.5” at their widest diameter, and have a rough exterior comprised of encrusted glass beads. The glass cones are permanently affixed to glass-covered plastic stands that measure 2.5” in height and 3.5” in diameter. The glass cones contain a battery compartment that powers LED lights, which is activated by a three-position (timer, off, on) slide-switch, which is located at the bottom of the base. When the slide-switch is turned on, the glass cone is illuminated by scattershot lighting, creating a decorative effect. The LED lights are not fixed into place in the interior of the cone. Each glass cone is unique, as the LED lights are placed at random, though the manufacturer ensures that LED lights are placed at the tip of each cone in order to create a glow at the tip, when the switch is turned on. The glass cones are sold in sets of three in one of the following colors: green, gold, red, silver, or blue.
Note 1(f) to Chapter 70 states that Chapter 70 does not cover “Toys, games, sports equipment, Christmas tree ornaments or other articles of chapter 95 (excluding glass eyes without mechanisms for dolls or for other articles of chapter 95).” Thus, if the subject glass cones are classifiable under heading 9505 under GRI 1, then they are excluded from Chapter 70, by operation of Note 1(f) to Chapter 70.
In your request for reconsideration, you argue that in HQ H241405, supra, CBP failed to properly apply the principal use analysis under Additional U.S. Rule of Interpretation 1(a) ((AUSRI 1(a)), claiming that the U.S. Court of Appeals for the Federal Circuit (CAFC) in Midwest of Cannon Falls, Inc., 122 F.3d. 1423, 1429 (Fed. Cir. 1997) (“Midwest”) determined that heading 9505 is a principal use provision. Under AUSRI 1(a), tariff classification under a principal use provision must be determined in accordance with the use in the United States of that class or kind to which the imported goods belong. However, AUSRI 1(a) does not apply because heading 9505 is not a principal use provision, as explained below.
As we stated in HQ H241405, merchandise is classifiable in heading 9505, HTSUS, as a festive article if the article satisfies two criteria: (1) it must be closely associated with a festive occasion and, (2) it must be used or displayed principally during that festive occasion. Additionally, the article must be "closely associated with a festive occasion" to the degree that "the physical appearance of an article is so intrinsically linked to a festive occasion that its use during other time periods would be aberrant." Michael Simon Design, Inc. v. United States, 452 F.Supp. 2d. 1316 (Ct. Int’l Trade 2006), aff’d 501 F.3d 1303 (Fed. Cir. 2007) reh’g denied (Fed. Cir. April 2, 2008) (citing Park B. Smith, Ltd. v. United States, 25 Ct. Int’l Trade 506 (2001), affirmed in part, vacated in part, and remanded, 347 F.3d 922 (Fed. Cir. 2003), reh’g denied (Fed. Cir. March 16, 2004) (citing Midwest of Cannon Falls, Inc. v. United States, 20 Ct. Int’l Trade 123 (1996), aff’d in part, rev’d in part, 122 F.3d 1423 (Fed. Cir. 1997))). See also HQ H089808, dated December 15, 2014. Hence, the courts have established a 2-prong test to determine whether an article is “festive”, and have not said that heading 9505 is a “principal use” provision.
Rather, under the 2-prong test set forth in the Park B. Smith, Ltd., 347 F.3d 922 (Fed. Cir. 2003), an article’s physical appearance and the court’s examination of such is part of the determination of whether an article is prima facie classifiable as a “festive” article, as articulated by the courts in the Midwest and Park B. Smith decisions. Accordingly, in HQ H241405, CBP stated that “it would not be aberrant to display the glass cones as a decoration at times during the year other than Christmas.”
You argue that the subject beaded glass article (pictured below, with the LED lights switched on) resembles a Christmas tree, which in turn is in the form of a symbol so closely associated with Christmas, that it must be classified as a festive article.
HQ H241405 acknowledged that a tabletop replica of a Christmas tree is a festive article. However, as the picture of the sample above demonstrates and as HQ H241405 discussed, the subject glass cone lacks branches, leaves, and other identifiable tree characteristics. The beaded exterior provides decorative texture; however, the beads are not ball-shaped; they also lack a definitive edge and a scalloped hanging crown associated with Christmas tree ball ornaments. See HQ H208175, dated June 28, 2012. Thus, we disagree that the subject glass cones closely resemble Christmas trees.
You next argue that the LED lights are arranged inside the cone to specifically represent a Christmas tree. You cite HQ 966616, dated March 3, 2004, in which we classified a “Bendable Christmas stick tree” in heading 9505 for the proposition that an evergreen shaped artificial tree that is decorated with one type of ornamentation, e.g., lights or acrylic beads, has been recognized as a Christmas tree under heading 9505, HTSUS. HQ 966616 is not analogous to the instant glass trees because it is not a tree. Moreover, the bendable stick tree is entirely distinguishable from the glass cone as it was made from wire and plastic, with wire shaped to resemble branches.
During our July 28 meeting, you demonstrated how the subject glass cones display a lighted tip that you argue resemble a lighted Christmas tree. However, the original sample provided to this office does not have a lighted tip, as shown in the above picture. The tip of the glass cone does not stay lit because the LED lights are not fixed into place inside the cone and eventually succumb to gravity. Hence, the instant glass cone does not have symbolic content “intrinsically related” to a Christmas tree. See Michael B. Simon Designs, Inc., 452 F. Supp. 2d 1316, 1326 (Ct Int’l Trade 2006). In contrast, we ruled in HQ H039566, dated April 15, 2015, that a lighted, beaded glass penguin lawn ornament which featured a Santa hat was classified in heading 9505, HTSUS, as a festive article because “[t]he penguin with Santa hat is closely associated with Christmas to the degree that its use during other time periods would be aberrant. It is not a general winter decoration; it is likely to be displayed only during the Christmas season, both because of the Santa hat motif and its use as a lighted lawn sculpture, which with the occasional exception are displayed only during the Christmas season.” Ibid.
You argue that the merchandise is only marketed and sold during the Christmas season. In support of your argument that the instant glass cones are Christmas decorations, you submitted online advertisements from a wholesale supplier of products of Mr. Christmas’s competitors, via an email on November 14, 2014. You assert that the enclosed advertisements show that “industry considers these items to be Christmas decorations.” One such picture is of a cone shaped glass article with LED lights and snowflakes design. However, CBP classified a similar article in heading 7013 in New York Ruling Letter (NY) L82780, dated March 17, 2005. As stated in HQ H241405, supra, the glass cones are marketed and advertised as Christmas decorations, but marketing in itself is not determinative. The fact that it is marketed under the name "Beaded Glass Christmas Tree" does not, in and of itself, convey the requisite association with Christmas. See HQ 958841, dated July 8, 1996 (classifying a similarly named and marketed glass tree in heading 7013).
Moreover, Mr. Christmas, Inc. and others currently sell similar merchandise outside the Christmas season that are not marketed strictly for Christmas use, but rather for seasonal décor. Although they do not appear to have LED lights, these glass trees have a decorative effect and use without the LED lighting. Further, although the advertisements for these glass trees indicate, “[t]his set of three glass trees made a chic addition to your holiday décor”, there is nothing in the illustrations (e.g., depicted as dinner table center piece) to indicate any holiday use, much less that their use is closely associated with a particular holiday. Furthermore, we note that QVC currently also sells similar glass cones that are designed by the same designer as the instant cone, which are marketed as “mercury glass accents from Valerie Parr Hill lighting up your holiday home.” The prospective buyer is advised to “place them on your dining room table, your mantel, your piano, or any other spot that could use an inviting glow.” Although they are marketed for holiday use, in QVC.com’s promotional video for the same product, Ms. Parr informs the viewer that the glass cones are packed in specially molded Styrofoam packing. She adds “I hope you’ll keep the packaging, but with gold and silver, why would you put them away. All year! All year!” Thus, LED lit glass cones are not sold specifically for Christmas use and display, but rather for general decorative use. Similarly, Kmart currently sells a “Mercury Glass LED Color Changing Décor” to be used for tabletop and mantel décor during the holiday season. We also located a similar glass LED lit cone-shaped tree, currently available for purchase, available now on Amazon. We note that Christmas is not used in the product’s marketing, rather it is part of the “Winter Whisperer” collection.” Thus, glass cones are not sold specifically for Christmas use, but rather to be used as general seasonal decoration. We are guided by the CAFC’s statement that the Midwest decision does not convert every article having a cheerful design or holiday association into a ‘festive article’ classifiable under Chapter 95”. Park B. Smith, 347 F.3d 922, 929 (Fed Cir. 2003). As we stated in HQ H241405, and as evident from marketing of similar items online discussed supra, the subject glass cone “could easily be used as seasonal decoration during the winter. Thus, we believe it would not be aberrant to display the glass cones as a decoration during the year other than Christmas.” Accordingly, the glass cone does not have a “direct association with and limited use to” Christmas. Ibid.
Furthermore, CBP has previously ruled that cone-shaped ornamental decorations of plastic, glass, metal or beads that were claimed to be “trees”, were not “festive.” See, e.g. New York Ruling Letter (NY) N152896, dated March 28, 2011 (classifying a plastic ornamental article in heading 3926), NY N073580, dated September 17, 2009 (classifying a cone-shaped glass tree in heading 7013), and NY N035077, dated August 13, 2008 (classifying a cone topiary decorated with beads in heading 3926). This is consistent with the Court of International Trade’s observation in Wilton Industries, Inc. v. United States, 493 F. Supp. 2d 1294 (Ct. Int’l Trade): “So too a star -- without more -- is just a basic geometric shape (like a circle, a square, a triangle, or a heart). Thus, a curious young child learning his or her shapes might enjoy using a star cookie cutter year-round.” Ibid, at 1334.
Instead, as the subject merchandise is not a festive article and is therefore not excluded from classification in chapter 70 by note 1(f) to that chapter, it is classified by its essential character under GRI 3 because it is made from glass of chapter 70 and contains LED lights of chapter 95. In fact, HQ H241405 correctly found that the beaded glass component imparted the essential character pursuant to GRI 3(b), because “the lighting function simply enhances the already decorative nature of the article.” Ibid.
Therefore, we affirm HQ H241405. Accordingly, the subject beaded glass cones are glass articles of a kind used for indoor decoration classified in heading 7013, HTSUS. Specifically, they are classified in subheading 7013.99.9000, HTSUSA (Annotated), which provides for: “Glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes (other than that of heading 7010 or 7018): Other glassware: Other: Other: Other: Valued over $3 each: Other: Valued over $5 each…” The 2016 general, column one rate of duty is 7.2% ad valorem.
Duty rates are provided for convenience only 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/.
Sincerely,
Myles B. Harmon, Director
Commercial Trade Facilitation Division