CLA-2 OT:RR:CTF:TCM H017864 GC
Lars-Erik A. Hjelm, Esq.
Akin, Gump, Strauss, Hauer & Feld, LLP
1333 New Hampshire Avenue, NW
Washington, D.C. 20036-1564
RE: Classification of “woven wood” window shade materials
Dear Mr. Hjelm:
On September 21, 2007, this office received your correspondence, dated August 7, 2007, requesting a binding ruling on the tariff classification under the Harmonized Tariff Schedule of the United States (HTSUS) of various materials imported by your client, Hunter Douglas, Inc. (Hunter Douglas), to manufacture window shades. Consideration was also given to the supplemental material submitted on November 21, 2007 and to the discussion with you and Hunter Douglas representatives, which took place at a meeting held at your request on January 4, 2008. Our ruling follows.
FACTS:
Hunter Douglas intends to use the subject materials to manufacture five different styles of window shades: Adelaide, Mandalay, Hokkaido, Shoji, and Kathay. Hunter Douglas imports the materials used to manufacture these styles in rolls, measuring 6 or 8 feet wide x 60 feet long. The ends are temporarily bound with tape. After importation, the material will be manufactured into the window shade styles referenced herein. Manufacturing consists of cutting the rolls to specifications and adding the necessary hardware such as head and bottom rails and a lift cord.
The Adelaide style is composed of a repeating pattern of one poplar wood strip (approximately 24 mm wide x 1.5 mm thick) and three marupa wood rods (approximately 2.75 mm in diameter), woven together with polyester yarn. The wood rods and strips are dried to reduce moisture content and discourage mold and decay. The wood strips comprise the greater surface area of the shade material.
The Mandalay style is composed of a repeating pattern in the following sequence: one bamboo cane, one bamboo rod, another bamboo cane, and nine bamboo rods. The bamboo canes are in a whole natural state with hollow cores and nodes, and they range in diameter from 3 mm to 8 mm. The bamboo rods, which are of a uniform diameter of about 2 mm, are derived (by molding) from whole bamboo canes, which are approximately 6 to 7 inches in diameter and 15 feet long when harvested. Prior to that, the rods are washed in hydrogen peroxide to remove dirt and impurities. After molding, the rods are dried in hot air to reduce moisture content. They are then woven together with the bamboo cane in the appropriate pattern with polyester yarn. The woven materials are then dried with hot air to ensure that the moisture content remains low to discourage mold and decay. The bamboo rods cover the greater amount of surface area of the woven wood fabric.
The Hokkaido style consists of seagrass bundles and bamboo strips measuring 11 mm wide x 2 mm thick, with multi-color tortoise shell coloring on one side. The colored side of every other bamboo strip is visible on each side of the woven wood fabric, thus creating a repeating pattern of four seagrass bundles, a plain bamboo strip, four seagrass bundles, and then a colored bamboo strip. The bamboo strips and the seagrass bundles comprise approximately equal amounts of the material’s surface area. The manufacturing process of the Hokkaido style is characterized by the following steps: harvesting the bamboo canes; washing in a chemical solution to remove dirt and impurities; splitting the bamboo canes into narrow strips; creating the tortoise effect on certain bamboo strips by burning or cooking the material; molding the bamboo strips to fit desired shape specifications; coloring the material by applying a chemical pigment mixed with a thinner, air drying and then lacquering; weaving the materials together with polyester yarn; and then drying the woven material in a kiln in order to remove moisture content to discourage mold and decay.
The Shoji style is composed entirely of ramin wood strips, approximately 4 mm wide x less than 1 mm thick. The wood comprising this style is also woven together with polyester yarn and dried to reduce moisture content.
The Kathay style is composed entirely of overlapping ramin wood strips measuring approximately 7 mm wide and 1 mm thick. The wood comprising this style is also woven together with polyester yarn and dried to reduce moisture content.
ISSUE:
What is the proper classification under the HTSUS of the subject merchandise?
LAW AND ANALYSIS:
Classification under the HTSUS is 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 under consideration in this case are as follows:
4421 Other articles of wood:
* * *
4421.90 Other:
* * *
Other:
* * *
4421.90.97 Other,
* * *
4421.90.9740 Other
* * *
4601 Plaits and similar products of plaiting materials, whether or not assembled into strips; plaiting materials, plaits and similar products of plaiting materials, bound together in parallel strands or woven, in sheet form, whether or not being finished articles (for example, mats, matting, screens):
* * *
Other:
4601.92 Of bamboo:
* * *
4601.92.2000 Other
* * *
4601.94 Of other vegetable materials:
* * *
Other:
4601.94.2000 Of willow or wood
Hunter Douglas proposes that the subject merchandise be classified in heading 4421, HTSUS. Legal note 1(f) to chapter 44, HTSUS, provides that goods of chapter 46 are excluded from chapter 44. Consequently, the principal issue in this case is whether the materials comprising the imported articles are plaiting materials, in which case the window shade materials are classifiable in heading 4601, HTSUS, as products of plaiting materials bound together in parallel strands or woven, in sheet form. Hunter Douglas contends that the imported merchandise is not comprised of plaiting materials, and is thus classifiable in heading 4421, HTSUS, which provides for other articles of wood.
The two other applicable legal notes in this case are note 1 and note 3 to chapter 46, HTSUS. Note 3 states:
For the purposes of heading 4601, the expression “plaiting materials, plaits, and similar products of plaiting materials, bound together in parallel strands”, means plaiting materials, plaits and similar products of plaiting materials, placed side by side and bound together, in the form of sheets, whether or not the binding materials are of spun textile materials. (Emphasis in original).
The materials comprising the subject merchandise fit within the terms of note 3, as they are placed side by side and bound together in parallel strands. This corresponds with the terms of heading 4601, HTSUS, because the process of weaving the wood fabrics is either synonymous with “interlacing” or is a “similar process” under the heading.
“Plaiting materials” of heading 4601, HTSUS, are defined by note 1 to chapter 46, HTSUS, as “materials in a state or form suitable for plaiting, interlacing, or similar processes.” Note 1 also cites bamboo, strips of woods, and strips of other vegetable material as materials falling within the meaning of “plaiting materials” for the purposes of chapter 46.
Hunter Douglas argues that the materials, as imported, are too rigid and thick to be plaited, and therefore do not meet the terms of note 1. Stated differently, Hunter Douglas essentially argues that if one were to take apart the finished woven wood fabrics, the materials comprising them are not “in a state or form suitable for plaiting, interlacing or similar processes” within the meaning of note 1. Thus, in spite of the fact that the legal note mentions strips of wood and bamboo as materials that can be plaiting materials suitable for plaiting, Hunter Douglas posits that these particular strips are not suitable for plaiting by virtue of their physical properties (width and thickness) and the fact that the materials have been dried to reduce their moisture content.
The essence of Hunter Douglas’ argument focuses on the requirement in note 1 that plaiting materials that are used to make products of plaiting materials must be in a state or form suitable for plaiting, interlacing or similar processes. Counsel would have us require that products potentially classifiable in chapter 46 must be disassembled and re-plaited to confirm that at time of importation, the materials are in a state or form suitable for plaiting. Setting aside the immense difficulties of administrating such an interpretation, such disassembly is unnecessary to administer note 1. The proper inquiry is not whether such materials, if disassembled, are “in a state or form suitable for plaiting”. Rather, the inquiry is whether the product at entry has been plaited. The fact that the CBP officer can examine the product and see that it is plaited confirms that it is made up of materials that were suitable for plaiting at the time the product was plaited. Note 1 requires us to consider what has been done to the product at issue at time of importation, not what could be subsequently done.
Hunter Douglas’s shade materials fit squarely into heading 4601, HTSUS, by application of notes 1 and 3 to chapter 46. Because the subject merchandise is classifiable under chapter 46, HTSUS, it is excluded from classification in chapter 44 by virtue of note 1(f) to that chapter. Note 6 to chapter 46 states that, “[s]ubject to note 1 above and except where the context otherwise requires, any reference to “wood” in a heading of this chapter applies also to bamboo and other materials of a woody nature.” (Emphasis added). Applied here, the bamboo strips of the Hokkaido style and the bamboo rods of the Mandalay style are excluded from chapter 44 by note 1(f), thus making note 6 inapplicable.
Hunter Douglas also argues that processing done to the wood strips before plaiting is important to the ultimate classification. From the information about the production of the Kathay and Shoji styles, the materials are air dried before being woven together in parallel strands. While drying the materials in a kiln would limit their flexibility, air drying the wood strips at various stages in the manufacturing process prior to weaving them together in parallel strands (e.g. after washing the wood of insects and impurities) would not render the materials unsuitable for plaiting. Like the wood strips in the Shoji and Kathay styles, the poplar wood strips of the Adelaide style are, at a thickness of 1.5 mm, sufficiently flexible to be considered in a state or form suitable for plaiting or interlacing. Periodically air drying the wood strips does not render them unsuitable for plaiting.
Similarly, the Hokkaido style of woven wood fabric is also a product of plaiting materials under heading 4601, HTSUS. As evidence that the material is not suitable for plaiting, Hunter Douglas points to when the bamboo strips of the style are colored to produce the tortoise shell appearance. This step involves the application of pigment mixed with thinner, air drying, and then the application of lacquer. While applying lacquer could conceivably render materials too stiff or rigid to be suitable for plaiting, this is not the case here. After the bamboo strips are colored, they are woven together in parallel strands and then immediately kiln dried in order to reduce moisture content, discourage mold and decay, and arguably, to stiffen the material. This indicates that the lacquer served principally to finish the pigmentation process as opposed to render the bamboo strips unsuitable for plaiting, interlacing, and similar processes.
While the Hokkaido style is composed of both bamboo strips and seagrass bundles, both of which satisfy note 1, classification at the six digit level implicates GRI 3, via GRI 6, which states:
For legal purposes, the classification of goods in the subheading of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.
GRI 3, states, in pertinent part:
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:
* * *
(b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, 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.
In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes (ENs) may be utilized. The ENs, though not dispositive or legally binding, may provide commentary on the scope of each heading of the HTSUS, and are the official interpretation of the Harmonized System at the international level. CBP believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989). In its discussion concerning “essential character,” the EN to GRI 3(b) states that:
The factor which determines essential character will vary as between different kinds of goods. It may, for example, 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.
Given the text of GRI 3(b) and its corresponding EN, the factor most indicative of the essential character of the material in this case is the surface area covered by the elements comprising the material because of the fact that the material primarily functions to block light. Visual impact is the second important factor because the material’s secondary function is decorative. Classification of the Hokkaido style at the subheading level will be according to the bamboo strips because the bamboo strips block more light by virtue of the fact that light passes through the individual pieces of grass and because the bamboo strips provide a more significant visual impact as a result of the tortoise shell coloring alternating with the solid colored bamboo strips.
The Mandalay style described above is an article made of both plaiting material (the bamboo rods) and non-plaiting materials (the bamboo cane). Whole bamboo canes are not considered to be bamboo in a form suitable for plaiting. See note 1(b) and note 6 to chapter 44, and articles made of whole bamboo canes are generally classifiable in chapter 44. See Headquarters Ruling Letter 956983, dated January 30, 1995 (holding that fencing made of whole bamboo cane is classifiable in heading 4421, HTSUS); see also New York Ruling Letters (NY) L80084, dated October 25, 2004, L85937, dated July 18, 2005, and L89264, dated December 30, 2005. In this case, the bamboo rods occupy the majority of surface area as opposed to the whole bamboo cane. However, because of the small spaces between the bamboo rods, we are unable to definitively state that they are more effective at blocking light than the bamboo cane. We are also unable to state definitively which material has the most significant visual impact. Because both headings merit equal consideration, GRI 3(c) controls. GRI 3(c) states that, “[W]hen goods cannot be classified by reference to 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.” In this case, the Mandalay style of woven wood fabric is classifiable under heading 4601, HTSUS.
To summarize, the subject woven wood fabrics are “…similar products of plaiting materials, bound together in parallel strands or woven, in sheet form” under heading 4601, HTSUS. The materials that comprise the various styles of the subject merchandise, with the exception of the bamboo cane in the Mandalay style, are all “suitable for plaiting, interlacing, or similar processes” as contemplated by note 1 to chapter 46, HTSUS. Processing these materials from whole plants into thin and flexible strips or rods renders them suitable for plaiting as contemplated by note 1 in that they are capable of being interlaced with one another or other materials such as yarn. During the production process of the subject woven wood fabrics, the materials are not stiffened or hardened to the extent that they are rendered unsuitable for plaiting. The fact that the materials have been woven together in parallel strands satisfies Legal notes 1 and 3, to Chapter 46, HTSUS, further supporting the conclusion that the subject merchandise is provided for in heading 4601, HTSUS.
HOLDING:
By application of GRI 1, and GRI 3(c) with the Mandalay style, the materials imported by Hunter Douglas for the five aforementioned styles of window shades are all classified under heading 4601, HTSUS, as plaiting materials, plaits and similar products of plaiting materials, bound together in parallel strands or woven, in sheet form, whether or not being finished articles.
Specifically, the Mandalay and Hokkaido styles are provided for in subheading 4601.92.2000, HTSUSA, which provides for: “Plaits and similar products of plaiting materials, whether or not assembled into strips; plaiting materials, plaits and similar products of plaiting materials, bound together in parallel strands or woven, in sheet form, whether or not being finished articles (for example, mats, matting, screens): Other: Of bamboo: Other. The general column one rate of duty is 6.6 percent ad valorem.
The Adelaide, Shoji, and Kathay styles are provided for in subheading 4601.94.2000, HTSUSA, which provides for: “Plaits and similar products of plaiting materials, whether or not assembled into strips; plaiting materials, plaits and similar products of plaiting materials, bound together in parallel strands or woven, in sheet form, whether or not being finished articles (for example, mats, matting, screens): Of other vegetable materials: Other: Of willow or wood.” The general column one rate of duty is 6.6 percent ad valorem.
The Kathay window shades are composed of ramin wood strips. Ramin is a protected wood species listed in the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES). The United States Department of Agriculture (USDA APHIS) is the contact office for information on plant clearance procedures. We advise that you contact the USDA APHIS, prior to importation of CITES listed products, at:
U.S. Department of Agriculture
APHIS
Plant Protection and Quarantine Permit Unit
4700 River Road, Unit 136
Riverdale, MD 20737-1236
Telephone number: 877-770-5990
Duty rates are provided for your convenience and 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.
Sincerely,
Gail A. Hamill, Chief
Tariff Classification and Marking Branch