CLA-2 OT:RR:CTF:FTM H276290 TSM
Port of New York/Newark, NJ
1210 Corbin Street
Elizabeth, NJ 07201
Attn: Patrick Caldarone, Import Specialist
Re: Protest and Application for Further Review No. 4601-16-100165; Classification of fabric bin arrays.
Dear Port Director:
The following is our decision regarding Protest and Application for Further Review No. 4601-16-100165, timely filed on February 15, 2016, on behalf of Kiva Systems LLC (hereinafter “Kiva Systems” or “Protestant”) regarding the tariff classification of fabric bin arrays under the Harmonized Tariff Schedule of the United States (“HTSUS”).
The fabric bin arrays at issue are described by the Protestant as follows:
The Fabric Bin Arrays are components specifically designed to be assembled into the Amazon Robotics Fabric Pods, which are warehouse racks made with steel posts and cross beams placed on the floor of the Amazon Fulfillment Centers. Made of yellow woven polyester, the Fabric Bin Arrays slip over the four corner posts of the Pods, and then secured to the crossbeams at the top of the Pods by metal clips. Once assembled, the Pod stands approximately 34.5” L x 34.5” W x 95” H. The Fabric Bin Arrays form small bins or “cubbies” of various sizes in which products can be stored, and plastic sheets are lined up around the Pod to stabilize the unit. An industrial robot called Drive Units can travel under these Pods and pick them up in order to move them to a different location of the warehouse. The Fabric Bin Arrays were imported as yellow woven polyester bin arrays with the metal clips attached and plastic label holders sewn in. The crossbeams, steel posts, and the plastic sheets were not part of the imports.
The subject merchandise covers eight different entries, entered between January 23, 2015 and March 23, 2015, under subheading 6307.90.98, HTSUS, which provides for “Other made up articles, including dress patterns: Other: Other: Other.” The subject entries were liquidated between December 4, 2015 and February 5, 2016, under subheading 6307.90.98, HTSUS, as entered.
In the Protest, dated February 15, 2016, Kiva Systems argued that the subject merchandise is classified under subheading 9403.90.60, HTSUS, which provides for “Other furniture and parts thereof: Parts: Other: Of textile material, except cotton.”
Whether the fabric bin arrays at issue are classified under subheading 6307.90.98, HTSUS, which provides for “Other made up articles, including dress patterns: Other: Other: Other,” or in subheading 9403.90.60, HTSUS, which provides for “Other furniture and parts thereof: Parts: Other: Of textile material, except cotton.”
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 of the entry. (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. 4601-16-100165 is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24 (a) because Protestant alleges that the decision against which the Protest is filed is inconsistent with Post Entry Amendments approved at the Port of Dallas/Fort Worth (classifying substantially similar goods under 9403.90.60, HTSUS).
Classification determinations under the HTSUS are made in accordance with the General Rules of Interpretation (GRIs). 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.
The HTSUS provisions at issue are as follows:
6307 Other made up articles, including dress patterns:
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9403 Other furniture and parts thereof:
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Note 7(a) to Section XI provides the following:
For the purposes of this section, the expression "made up" means:
Cut otherwise than into squares or rectangles;
Produced in the finished state, ready for use (or merely needing separation by cutting dividing threads) without sewing or other working (for example, certain dusters, towels, tablecloths, scarf squares, blankets);
Cut to size and with at least one heat-sealed edge with a visibly tapered or compressed border and the other edges treated as described in any other subparagraph of this note, but excluding fabrics the cut edges of which have been prevented from unraveling by hot cutting or by other simple means;
Hemmed or with rolled edges, or with a knotted fringe at any of the edges, but excluding fabrics the cut edges of which have been prevented from unraveling by whipping or by other simple means;
Cut to size and having undergone a process of drawn thread work;
Assembled by sewing, gumming or otherwise (other than piece goods consisting of two or more lengths of identical material joined end to end and piece goods composed of two or more textiles assembled in layers, whether or not padded); or
Knitted or crocheted to shape, whether presented as separate items or in the form of a number of items in the length.
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Additional U.S. Rule of Interpretation 1(c), HTSUS, provides in relevant part:
In the absence of special language or context which otherwise requires:
(c) a provision for parts of an article covers products solely or principally used as a part of such articles but a provision for "parts" or "parts and accessories" shall not prevail over a specific provision for such part or accessory
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In addition, in interpreting the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs 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).
EN to heading 63.07 provides, in pertinent part, the following:
This heading covers made up articles of any textile material which are not included more specifically in other headings of Section XI or elsewhere in the Nomenclature.
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General ENs to Chapter 94 provide, in pertinent part, the following:
For the purposes of this Chapter, the term “furniture” means:
Any “movable” articles (not included under other more specific headings of the Nomenclature), which have the essential characteristic that they are constructed for placing on the floor or ground, and which are used, mainly with a utilitarian purpose, to equip private dwellings, hotels, theatres, cinemas, offices, churches, schools, cafés, restaurants, laboratories, hospitals, dentists’ surgeries, etc., or ships, aircraft, railway coaches, motor vehicles, caravantrailers or similar means of transport. (It should be noted that, for the purposes of this Chapter, articles are considered to be “movable” furniture even if they are designed for bolting, etc., to the floor, e.g., chairs for use on ships). Similar articles (seats, chairs, etc.) for use in gardens, squares, promenades, etc., are also included in this category.
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Further, ENs to Chapter 94 provide, in pertinent part, the following:
This Chapter only covers parts, whether or not in the rough, of the goods of headings 94.01 to 94.03 and 94.05, when identifiable by their shape or other specific features as parts designed solely or principally for an article of those headings. They are classified in this Chapter when not more specifically covered elsewhere.
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GRI 3(a) provides as follows:
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:
The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods.
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Applying GRI 1, the first issue is whether the fabric bin arrays are classified under heading 6307, HTSUS, as “other made up articles,” or under heading 9403, as “other furniture and parts thereof.” Upon review, we find that the fabric bin arrays at issue are provided for in heading 6307, HTSUS, since they are articles of textile (polyester) made up within the meaning of Note 7(a) to Section XI, because they are produced in the finished state and ready for assembly with the Amazon Robotics Fabric Pods without sewing or other working. However, heading 6307, HTSUS, is a basket provision for textile articles not more specifically described elsewhere in the Nomenclature. The EN to heading 6307, HTSUS, notes that the heading covers made up articles of any textile material which are not included more specifically in other headings of Section XI or elsewhere in the Nomenclature. Therefore, classification in heading 6307, HTSUS, is precluded if the merchandise is covered more specifically in another tariff provision.
Heading 9403, HTSUS, provides eo nomine for other furniture and parts thereof. The HTSUS does not define "furniture" for tariff classification purposes, beyond establishing that it must be designed for placement on the floor or ground. See The Container Store v. United States, 800 F. Supp. 2d 1329, 1335 (Ct. Int’l Trade 2011). However, the ENs to Chapter 94 provide that furniture may include “movable furniture” that is used “mainly with a utilitarian purpose.” In view of this, the courts have held that portable articles are classifiable in heading 9403, HTSUS, so long as their predominant functions are utilitarian, in that they lend themselves to particular uses, rather than decorative or ornamental. See The Pomeroy Collection, Ltd. v. United States, 893 F. Supp. 2d 1269, 1283-85 (Ct. Int’l Trade 2013) (citing Furniture Import Corp. v. United States, 56 Cust. Ct. 125, 133 C.D. 2619 (1966)). Notably, however, an article used solely to display ornamental objects remains ornamental itself, and does not qualify as furniture within the meaning of heading 9403. See id. at 1284-85. Consistent with these principles, CBP has classified various portable structures in heading 9403 where they perform utilitarian functions by, for example, displaying or securing lights, retail products, or other non-decorative objects. See, e.g., Headquarters Ruling Letter (HQ) 964916, dated July 27, 2002 (classifying wooden and plastic screens used as partitions in heading 9403); New York Ruling (NY) I89667, dated January 9, 2003 (classifying pop-up display structure with light fixtures in heading 9403); NY B80536, dated December 31, 1996 and NY 809309, dated April 17, 1995 (both classifying inflatable trade show display booth and office work station designed to display products in heading 9403).
The fabric bin arrays at issue are designed to be assembled into the warehouse racks made with steel posts and cross beams placed on the floor or ground, used with a utilitarian purpose of storing goods. See NY I82827, dated June 17, 2002 (classifying steel rack components for pallet racks and other storage systems). Upon review, we find that the warehouse racks at issue here are very similar to those under consideration in NY I82827. Therefore, we conclude that the warehouse racks satisfy the definition of furniture set forth in Note 2 to Chapter 94 and are therefore eo nomine provided for in heading 9403, HTSUS, as “other furniture.”
Turning to the fabric bin arrays, at issue is whether they are more specifically classified under heading 9403, HTSUS, as parts of furniture, than under heading 6307, HTSUS. “[A]n imported item dedicated solely for use with another article is a ‘part’ of that article within the meaning of the HTSUS.” Bauerhin Techs. Ltd. Pshp. v. United States, 110 F.3d 774, 779 (Fed. Cir. 1997); See NY N261040, dated February 12, 2015 (classifying plastic shelf liners dedicated solely for use with certain shelving units, and imported solely and irrevocably for use with those shelving units, as parts of furniture of 9403, HTSUS).
In prior rulings, we found that separately imported fabric articles, typically supported by a steel frame but capable of being used on their own, are not furniture in their own right and are classified as parts of furniture only if imported together with the steel frame. Thus, in NY 890322, dated September 20, 1993, a log rack, consisting of a detachable canvas carrier and a steel frame (both imported together), was classified as furniture of heading 9403, HTSUS. However, in NY 887797, dated July 7, 1993, a canvas log carrier imported with no accompanying frame and capable of being used independently of the frame, was classified as other made up articles of heading 6307, HTSUS.
In other rulings we found that when a specific frame is not needed and any generic frame, such as a closet rod, can be used to support a fabric structure, the fabric structure is not classified as furniture. See NY N005781, dated February 7, 2007 (classifying the “Hanging Shoe Shelves” used for the organization of shoes and accessories and intended to hang from a closet rod, constructed of a polyester warp knit fabric body with 10 vertically arranged shelves and five open mesh pockets on each side, under heading 6307, HTSUS). See also NY N251387, dated April 8, 2014 (classifying collapsible home storage organizers, hung using wide fabric straps sewn to the top of the organizers with hook-and-loop strips sewn on their ends, designed to hang from a closet rod, under heading 6307, HTSUS).
Upon review, we find that the fabric bin arrays at issue are designed solely for use with the warehouse racks. Even though they are imported separately, both the warehouse racks and the fabric bin arrays are designed to function together as one unit. Moreover, the record shows that the fabric bin arrays fit the specific dimensions of the warehouse racks. They are sewn to allow for the upright tubes of the rack to be inserted forcing the fabric shelving to open to its full width, while the loops at the top suspend the merchandise from the top horizontal portion of the rack. We also note that unlike the log carrier at issue in NY 887797, the fabric bin arrays under consideration have no independent function of their own. Moreover, unlike the fabric structures intended for use with a closed rod, at issue in NY N005781 and NY N251387, the fabric bin arrays at issue here cannot be used with any frame other than the warehouse racks. Therefore, we conclude that they are parts of furniture that are eo nomine provided for in heading 9403, HTSUS.
However, as indicated above, the instant merchandise may also be described as “other made up articles” of heading 6307, HTSUS. The instant goods are therefore prima facie classifiable under two different headings. GRI 3(a) provides that for goods which are prima facie classifiable under two or more headings, the heading which provides the most specific description shall be preferred to headings providing a more general description.
Furthermore, Additional U.S. Rule of Interpretation 1(c), HTSUS, states that “a provision for parts of an article covers products solely or principally used as a part of such articles but a provision for “parts” or “parts and accessories” shall not prevail over a specific provision for such part or accessory.” However, heading 6307, HTSUS, is a general heading, or basket provision. See Item Company v United States, 98 F. 3d 1294, 1296 (Fed. Cir. 1996). Classification of imported merchandise in a basket provision is only appropriate if there is no tariff category that covers the merchandise more specifically. As such, heading 6307, HTSUS, does not constitute a specific provision for the purposes of Additional U.S. Rule of Interpretation 1(c). See H249319, dated July 08, 2015; HQ 960950, dated January 16, 1998 (“It is an accepted rule of classification that a basket provision is not specific for tariff purposes. Subheading 4205.00.80, HTSUS, is not a specific provision because it is a basket provision. For this reason, it does not prevail over subheading 8708.99.80, HTSUS.”). See also HQ 965401, dated April 22, 2002; HQ W968461, dated February 22, 2010; and HQ 957811, dated July 19, 1995.
While heading 6307, HTSUS, is a basket provision for textile articles not more specifically described elsewhere in the Nomenclature, heading 9403 is a more specific provision, which provides eo nomine for other furniture and parts thereof. As referenced above, in accordance with GRI 3(a) the heading which provides the most specific description shall be preferred to headings providing a more general description. In most cases, goods will be classified in a provision that most narrowly and specifically describes them or which have requirements that are more difficult to satisfy. Heading 9403 encompasses "other" furniture, a class of goods designated eo nomine, by name, and a term that is defined in the ENs. Therefore, we conclude that an eo nomine designation of heading 9403, HTSUS, prevails over the basket provision of heading 6307, HTSUS. See Kahrs Int'l v. United States, 713 F.3d 640 (Fed. Cir. Apr. 3, 2013). Accordingly, the fabric bin arrays at issue are classified under heading 9403, HTSUS, and specifically subheading 9403.90.60, HTSUS, which provides for “Other furniture and parts thereof: Parts: Other: Of textile material, except cotton.”
By application of GRI 1 and GRI 3(a), the fabric bin arrays at issue are classified under heading 9403, HTSUS, and specifically under subheading 9403.90.60, HTSUS, which provides for “Other furniture and parts thereof: Parts: Other: Of textile material, except cotton.” The 2017 column one, general rate of duty is free.
You are instructed to ALLOW the protest.
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 of Trade, Regulations and Rulings will make the decision available to CBP personnel, and to the public on the Customs Rulings Online Search System (CROSS) at https://rulings.cbp.gov/ which can be found on the U.S. Customs and Border Protection website at http://www.cbp.gov and other methods of public distribution.
Myles B. Harmon, Director
Commercial and Trade Facilitation Division