CLA-2 RR:CR:GC 960139K
Port Director
U.S. Customs Service
196 West Service Road
Champlain, New York 12919
RE: Protest 0712-96-100626; Cote Decorations, Inc.; Ficus Trees; NAFTA Eligibility
Dear Port Director:
This is our decision on protest 0712-96-100626 concerning your classification of artificial ficus trees.
FACTS:
The six consumption entries covering the imported artificial ficus trees were reported as being liquidated on March 15, 1996 and May 24, 1996, under the provision for other artificial foliage of other materials, other than of plastics, other than of feathers, and other than of man-made fibers, in subheading 6702.90.65, Harmonized Tariff Schedule of the United States (HTSUS), with duty at the 1995 and 1996 general rate of 17% ad valorem. A claim for NAFTA (North American Free Trade Agreement) treatment was denied on Customs Form 29, dated February 8, 1996. A timely protest under 19 U.S.C. 1514 was received on June 10, 1996. The protestant not only contested the denial of NAFTA treatment under subheading 6702.90.65, but also requested reliquidation of the entries under the provision for artificial foliage of man-made fibers, in subheading 6702.90.35, HTSUS, with the special rate of duty applicable for Canada in 1995, at 2.7% ad valorem and at the 1996 special rate at 1.8% ad valorem.
A black and white photostatic copy of a photo depicts a sample of an artificial ficus tree about 7 feet tall in a 12 inch stone pot. The tree is assembled in Canada and imported into the United States. The artificial ficus tree is composed of various materials of Canadian and U.S. origin such as artificial foliage, coloring, wiring, and the stone pot. A branch of a tree is stripped except for its bark, and serves as the tree trunk for the artificial tree. The trunk has drilled holes. The component that originates from China consists of molded plastic branches and stems with polyester leaves adhered to the stems. The branches are inserted into the holes of the trunk.
ISSUE:
The issues concern the classification of an artificial ficus tree as imported and as described above and whether the component of Chinese origin, used in the assembly of the tree, is or is not a “part” of artificial foliage which would determine the eligibility for NAFTA treatment.
LAW AND ANALYSIS:
Heading 6702, HTSUS, provides for, artificial flowers, foliage and fruit and parts thereof;
articles made of artificial flowers, foliage or fruit:
6702.10 Of plastics:
6702.10.20 Assembled by binding with flexible
materials such as wire, paper, textile
materials, or foil, or by gluing or by
similar methods
6702.10.40 Other, including parts
6702.90 Of other materials:
6702.90.10 Of feathers
Other:
6702.90.35 Of man made fibers 6702.90.65 Other
Note 3(b), Chapter 67, HTSUS, states that heading 6702 does not cover:
Artificial flowers, foliage or fruit of pottery, stone, metal, wood or other materials, obtained in one piece by molding, forging, carving, stamping or other process, or consisting of parts assembled otherwise than by binding, gluing, fitting into one another or similar methods.
In this case, the component from China, and the tree as assembled in Canada, are not precluded from coverage by the Chapter Note for heading 6702, HTSUS. The component that originates from China consists of a molded plastic branch and stems with polyester leaves bound (or adhered) to the stems. The branches are inserted into the holes of the trunk. The component from China and the tree as assembled in Canada, are classified in heading 6702, HTSUS.
The classification of imported merchandise under the HTSUS is governed by the principles set forth in the General Rules of Interpretation (GRI). GRI 1 requires that classification be
determined first according to the terms of the headings of the tariff schedule and any relative section and chapter notes and, unless otherwise required, according to the remaining GRI, taken in their appropriate order. Accordingly, we first have to determine whether the articles are classified under GRI 1. The article as described is not excluded from coverage in heading 6702 by virtue of Note 3(b), Chapter 67. However, no one subheading within heading 6702 solely covers the artificial ficus tree with its several components and we cannot classify the tree by virtue of GRI 1.
Therefore, GRI 2 requires that the "classification of goods consisting of more than one material or substance shall be according to the principles of rule 3." GRI 3(b) is applicable for goods made up of different components and that rule requires that "...composite goods of different materials or made up of different components... 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 protestant opines that the polyester leaves adhered to the stems of the branches give the tree its essential character.
The black and white photostatic copy of a photo contained in the file depicts a sample of an artificial ficus tree about 7 feet tall in a 12 inch stone pot. The trunk and the pot by themselves have very little character and would hardly be considered as ornamental articles for display purposes. The leaves on the stems of the branches cover about 2/3 of the trunk of the tree from the top down, and spread out for 2 feet or more. The photo clearly shows that it is the leaves that give the tree its essential character and we agree with the position of the protestant.
Accordingly, the artificial ficus tree as imported is classified in subheading 6702.90.35, HTSUS, as an other article made of artificial foliage, of man-made fibers. The remaining issue is whether the component from China is foliage or a part of foliage.
General Note 12, HTSUS, describes the eligibility for NAFTA treatment for imported goods from Mexico or Canada. General Note 12(b)(iv)(B), states that
(b) For the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as "goods originating in the territory of a NAFTA party" only if
(iv) they are produced entirely in the territory of Canada, Mexico and/or the United States but one or more of the non originating materials falling under provisions for "parts" and used in the production of such goods does not undergo a change in tariff classification because--
(B) the tariff headings for such goods provide for and specifically describe both the goods themselves and their parts and is not further divided into subheadings, or the subheadings for such goods provide for and specifically describe both the goods themselves and their parts, [with certain exceptions].
The artificial ficus tree assembled in Canada and as imported into the United States, is classified as an other article made of artificial foliage, of man-made fibers in subheading 6702.90.35, HTSUS. The component from China assembled in Canada with other Canadian and United States components, consists of plastic branches and stems with polyester leaves adhered to the stems. The applicability of General Note 12 (b)(iv)(B), conferring NAFTA eligibility depends on whether the component from China is classified, as it is shipped to Canada, as “foliage” or as “parts” of foliage.
“Foliage” is defined in Webster’s New World Dictionary, Second College Edition, as
1. leaves, as of a plant or tree; mass of leaves; leafage. 2. a decoration consisting of a representation of leaves, branches, flowers, etc.
“Foliage” is also defined in The Random House Dictionary of the English Language, Unabridged Edition, as 1. The leaves of a plant, collectively; leafage. 2. Leaves in general. 3. The representation of leaves, flowers, and branches in painting, architectural ornament, etc.
The component from China meets the common definitions for foliage and is classified in heading 6702, as artificial foliage.
The Explanatory Notes (EN's) to the Harmonized Commodity Description and Coding System, which represent the official interpretation of the tariff at the international level, facilitate classification under the HTSUS by offering guidance in understanding the scope of the headings and General Rules of Interpretation of the HTSUS. The EN’s for heading 6702 states that this heading covers:
(1) Artificial flowers, foliage and fruit in forms resembling the natural products, made by assembling various parts (by binding, glueing, assembling by fitting into one another or similar methods). This category also includes conventional representations of flowers, foliage or fruit made up in the manner of artificial flowers, etc.
(2) Parts of artificial flowers, foliage or fruit (e.g., pistils, stamens, ovaries, petals, calyces, leaves and stems).
(3) Articles made of artificial flowers, foliage or fruit (e.g., bouquets, garlands, wreaths, plants), and other articles, for use as trimmings or as ornaments, made by assembling artificial flowers, foliage or fruit.
(Emphasis added.)
The component from China does not consist of, pistils, stamens, ovaries, petals, calyces, leaves, or stems, that are “parts” of foliage used in an assembly of an article of foliage. The component from China consists of a molded plastic branch with stems, and leaves of man-made fibers adhered to the stems. The component is described by the first statement above, for artificial foliage made by assembling various parts of artificial foliage, in this case, adhering the leaves of man-made fibers to the molded plastic branch and stems. The component from China, would be classified as artificial foliage in heading 6702, HTSUS, and not as a part of artificial foliage in heading 6702, HTSUS.
Accordingly, the assembly of the artificial ficus tree in Canada, does not meet the criteria of General Note 12(b)(iv)(B), HTSUS, and it is not eligible for NAFTA treatment.
HOLDING:
The artificial ficus tree, as described above, is classified as other articles made of artificial foliage, of man-made fibers, in subheading 6702.90.35, HTSUS.
The artificial ficus tree, as described above, does not qualify for NAFTA treatment under General Note 12(b)(iv)(B), HTSUS.
You are directed to allow the protest, in part, by the reliquidation of the entries under subheading 6702.90.35, HTSUS, and to disallow the NAFTA eligibility.
In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, Revised Protest Directive, dated August 4, 1993, a copy of this decision attached to Customs Form 19, Notice of Action, should be provided by your office to the protestant no later than 60 days from the date of this decision and any reliquidation of entries in accordance with this decision must be accomplished prior thereto. Sixty days from the date of this decision the Office of Regulations and Rulings will take steps to make this decision available to Customs personnel, and to the general public on the Customs Home Page on the World Wide Web at www.customs.ustreas.gov, by means of the Freedom of Information Act and other public access channels.
Sincerely,
John Durant, Director
Commercial Rulings Division
Office of Regulations and Rulings