CLA-2-42: RR: CR:TE 964824 JFS
Category: Classification
Tariff No.: 4202.12.2035
Port Director
U.S. Customs Service
610 South Canal Street
Chicago, Illinois 60607
Re: Decision on Application for Further Review of Protest No. 3901-00-100533; Briefcase; Heading 4202; Not Heading 4820; Avenues in Leather; Outer Surface of Plastics
Dear Sir:
This is a decision on an application for further review (AFR) of a protest timely filed on May 25, 2000, by Hodes, Keating & Pilon, on behalf of Heritage Industries, Ltd. The Protest concerns the classification and liquidation of several entries of briefcases entered in April and June, 1999.
In addition to the classification of the instant briefcase, the Protestant initially protested the classification of two other items, a leather travel document case (Model No. 12615), and a vinyl portfolio (Model No. 2460115). However, the Protestant did not file an AFR for those two goods. Accordingly, this decision only addresses the classification of the briefcase, Model No. 12975.
FACTS:
You classified the merchandise in subheading 4202.11.0030, HTSUSA, which provides, in pertinent part, for: “Trunks, suitcases, vanity cases, attache cases, briefcases . . .: Trunks, suitcases, vanity cases, attache cases, briefcases, school satchels and similar containers: With outer surface of leather, of composition leather, or of patent leather, Attache cases, brief cases, school satchels, occupational luggage cases and similar containers,” with a general column one duty rate (in 1999 and2002) of 8 percent ad valorem.
The protestant claims that the goods should be classified in subheading 4820.10.2020, HTSUSA, which provides, in part, for registers, notebooks, letter pads, memorandum pads and similar articles, with a general column one duty rate (in 1999) of 2 percent ad valorem.
The article that is the subject of this protest is a portfolio type of case that measures 15 inches, by 11 ½ inches, by 3 inches. It has retractable handles and a zippered closure along three sides. Each side of the exterior has a full width pocket. The interior has a full-length gusseted pocket, and a metal, three-ring binder (whose rings measure approximately two inches in diameter) affixed to the spine. An 8-½ inch by 11 inch ruled paper pad is inserted on the case’s interior right hand side. The left interior side has a fully lined panel similar to the kind found in a traditional briefcase. The panel has a zippered pocket, business card pocket, and two penholders.
The folio case is marketed as having a “Distinctive PU/Split Cowhide Leather Exterior.” Results from a United States Customs Service Laboratory Report, Lab Report #: CH20010930, dated June 22, 2001, revealed that the case is composed of plastic-coated split leather backed with a thin nonwoven fabric. The leather is coated on its exterior surface with two layers, a black layer and a clear layer, of polyurethane plastics. The black layer is on the outermost surface and covers the clear layer. The two layers of plastic material combined, range from 0.033 mm in thickness to 0.126 mm in thickness.
Prior to liquidation of any of the entries at issue, Customs issued New York Ruling Letter (NY) F81248, dated December 29, 1999, which classified the article under subheading 4202.11.0030, HTSUSA, as an attache case, briefcase or similar article, with an outer surface of leather. Subsequently, while considering the protest, Customs submitted the folio case to the Customs Laboratory for analysis, which revealed that the folio case was coated with plastic. NY F81248 was issued prior to the discovery that the article’s outer surface was composed of plastic-coated leather, but was correct based on the information available to Customs at the time. Thus, there is no need to revoke or modify NY F81248.
ISSUES:
1. Is the folio case classified under heading 4202, HTSUSA, or under heading 4820, HTSUSA?
2. Is the outer surface of the folio case “of leather” or “of plastics?”
LAW AND ANALYSIS:
Classification under the HTSUSA 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 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 GRI may then be applied.
The Harmonized Commodity Description and Coding System Explanatory Notes (EN), represent the official interpretation of the Harmonized System at the international level (for the 4 digit headings and the 6 digit subheadings) and facilitate classification under the HTSUSA by offering guidance in understanding the scope of the headings and GRI. The Explanatory Notes, although not dispositive or legally binding, provide a commentary on the scope of each heading of the HTSUSA, and are generally indicative of the proper interpretation of these headings.
ISSUE 1: Is the folio case classified under heading 4202, HTSUSA, or under heading 4820, HTSUSA?
The protestant claims that the goods should be classified in subheading 4820.10.2020, HTSUSA, which provides, in part, for registers, notebooks, letter pads, memorandum pads and similar articles. In support of this argument, the Protestant cites to: Headquarters Ruling Letter (HQ) 959958, dated June 8, 1999; HQ 961366, dated April 28, 1999; HQ 960763, dated December 7, 1997; HQ 960542, dated December 7, 1997; HQ 959702, dated June 11, 1997; HQ 957667, dated May 15, 1995; HQ 957308, dated April 20, 1995; and HQ 956539, dated September 7, 1994. The protestant states that these rulings hold that organizers, agendas, planners and similar items imported with paper inserts are classifiable under heading 4820, HTSUSA. However, the articles in the cited rulings are distinguishable from the instant folio case under consideration because they have significantly limited carrying capacity for personal items not related to writing.
The instant article is very similar to the attache cases or briefcases that were the subject of Avenues in Leather, Inc. v. United States, 11 F. Supp. 2d 719 (1998). In Avenues in Leather, the Court of International Trade (CIT) considered the proper classification of two general styles of folios that were zippered on three sides, had gusseted compartments, and contained a three ring binder down the spine. The folios were imported with a paper pad inserted in one of the pockets. The competing subheadings under consideration, were subheading 4202.11.00, and subheading 4820.10.20, HTSUSA. The styles of folios most like the instant article were described as follows:
Each case measures 10 1/2 inches by 13 1/2 inches by 1 3/4 inches and has a zipper closure that extends around three sides. . . . The interior is fitted with various pockets and compartments. One side has an accordion folio section on the interior that has two compartments and two gussets and is the full size of one side of the case. This folio section is large enough to contain small books or newspapers. The front panel of the folio is fitted with two pen/pencil holders, two pockets, each having a hook and loop flap closure and designed to hold 3 1/2 inch floppy disks or other small articles, a pocket for business cards, and a zippered utility security pocket which measures 10 inches wide by 5 1/2 inches deep. This fitted front panel is similar to those frequently found in briefcases, attache cases, and other executive business cases. The opposite interior side is fitted with a slot designed to contain a standard 8 1/2 by 11 inch pad. . . . Exhibits G and I do not have the removable binder, but instead the binder assembly is sewn into the spine of the case. The exterior sides of all of these cases are fitted with an open pocket, which measures the full size, height and width of the side of the case. Each of these articles has a leather padded carrying handle fitted to the exterior spine. Each case has a writing pad inside. . . .
Other than having one interior gusseted pocket and retractable handles, the instant article has features substantially similar to those of the folios described in Avenues in Leather. Although the instant article has one less interior gusseted pocket, it is 4 ½ inches taller, 1 ¼ inches thicker, and only 2 inches less in width than the folios in Avenues in Leather. Of significance, is that the CIT noted that the binder assembly in no way prevented or impeded other papers or articles from being carried in space remaining in the main part of the case without being fastened in the binder, and that the cases were extremely well-suited for organizing, storing, protecting and carrying papers, documents and many other items that would fit in a briefcase. See HQ 964403, dated February 26, 2002. In sum, the interior of the instant folio case is sufficiently large to hold books, newspapers and other personal items.
On appeal, the Court of Appeals for the Federal Circuit found that:
It is, of course, unquestionable that the imported folios exhibit a number of characteristics and accomplish a range of purposes – indeed, their very versatility is an attractive feature. Prominent among these purposes are those exemplified in the listed items in Heading 4202: organizing, storing, protecting, and caring various items. The Court of International Trade noted that the folios’ large size, numerous and sizable pockets, and external handles speak strongly of the “organizing, storing, protecting, and carrying” characteristics of the imported merchandise – a conclusion with which we readily concur.
Avenues in Leather v. United States, 178 F.3d 1241, 1245 (citations omitted) (1999). Due to the similarity in features of the instant article to the folios considered in Avenues in Leather, the folio, style 12975, is classified in heading 4202, HTSUSA.
ISSUE 2: Is the outer surface of the folio case “of leather” or “of plastics?”
The next issue concerns the subheading under which the folio case will be classified. Customs Laboratory analysis reveals that the outer surface of the split leather is coated with two layers of polyurethane plastic. Articles of heading 4202, HTSUSA, are classified at the subheading level according to their exterior surface.
The legal reasoning and analysis employed in HQ 963618, dated August 2, 2002, classifying a handbag composed of plastic coated split leather, is adopted and incorporated by reference. HQ 963618 is attached and made part of this ruling letter. The folio case is a container similar to an attache case or a briefcase, which has an outer surface of plastics. It is classified in subheading 4202.12.2035, HTSUSA.
HOLDING:
The legal reasoning and analysis of HQ 963618, dated August 2002, are adopted and incorporated by reference into this ruling.
The folio case, model #12975, is classified in subheading 4202.12.2035, HTSUSA, which provides, in pertinent part, for: “Trunks, suitcases, vanity cases, attaché cases, briefcases . . . and similar containers . . .: Trunks, suitcases, vanity cases, attaché cases, briefcases, school satchels and similar containers: With outer surface of plastics or of textile materials: With outer surface of plastics, Other: Attaché cases, briefcases, and similar containers.” The general column one rate of duty (in 1999) is 20 percent, ad valorem.
Since the rate of duty under the classification indicated above is more than the liquidated rate, the protest should be DENIED in full. In accordance with Section 3A (11) (b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you are to mail this decision, together with the Customs Form 19, to the protestant no latter than 60 days from the date of this letter. Any reliquidation of the 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 Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.ustreas, by means of the Freedom of Information Act and other public access channels.
Sincerely,
Myles B. Harmon, Acting Director
Commercial Rulings Division
Enclosure