CLA-2: OT: RR: TCM: H248109 ERB
Port Director
Port of Lost Angeles/Long Beach
301 E. Ocean Blvd.
Suite 1400
Long Beach, CA 90802
Attn: Quoc Tran, Import Specialist
RE: Application for Further Review of Protest No. 2704-13-100420; Tariff classification of culinary knife sets
Dear Port Director:
The following is our decision regarding the Application for Further Review (AFR) of Protest No. 2704-13-100420, timely filed by counsel on February 25, 2013, on behalf of Ronco Holdings, Inc. (Ronco). The AFR concerns the tariff classification of a twenty-six (26) piece cutlery set under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
The subject merchandise is a “Six Star 25 Piece Knife Set with Injector.” It includes: one all purpose “Showtime” knife, one carving knife, one large fillet knife, one bread knife, one chef’s knife, one saw-style knife, one boning knife, one “Sportsman” knife (used for fish and game), one “Chop & Serve” chopping knife, one cheese knife, one cleaver, one carving fork, one utility knife, eight steak knives, one paring knife, one garnish knife, one set of kitchen and poultry shears, and one sharpener for straight edge knives only. Lastly, a bonus inclusion (the 26th piece) is a plastic plunger-style injector for inserting oils, fillings, spices or other flavors into food, such as meat or pastries. The various knives, cleaver, chopper and shears have stainless steel blades and plastic handles. The sharpener is handheld, and is constructed of plastic with sharpening stones of aluminum silicon carbide.
Ronco imported eleven entries between October 8, 2011 and March 26, 2012, classified in subheading 8211.91.5060, HTSUSA, which provides for, “Knives…: Other: Knives with rubber or plastic handles: Steak knives.” CBP liquidated all entries under subheading 8211.10.00, HTSUS, which provides for, “Knives…: Sets of assorted articles.”
ISSUE:
What is the classification of the subject twenty-six piece cutlery set.
LAW AND ANALYSIS:
Initially, we note that the matter 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 for entries made on or after December 18, 2004. (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. 2704-13-100420 is properly accorded to Ronco pursuant to 19 C.F.R. § 174.24(b) because it is alleged that this protest involves questions of law and fact which have not yet been ruled upon by Customs or the Courts.
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.
Because the instant classification issue occurs beyond the four-digit heading level, GRI 6 is implicated. GRI 6 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.
The HTSUS provisions under consideration are as follows:
8211 Knives with cutting blades, serrated or not (including pruning knives), other than knives of heading 8208, and blades and other base metal parts thereof:
8211.10.00 Sets of assorted articles
8211.91. Table knives having fixed blades:
8211.91.5030 Knives with rubber or plastic handles: Steak knives
8211.92 Other knives having fixed blades
Subheading 8211.10.00, HTSUS stipulates that the general column one rate of duty is determined according to the rate of duty applicable to that article in the set subject to the highest rate of duty.
Statistical Note 1 to Chapter 82 states that for the purposes of statistical reporting of sets in heading 8205, 8211 or 8215, the number of pieces reported shall be the total number of separate pieces in the set(s). For example, if a knife is imported with its blade attached and three replacement blades, the importer must report four pieces. See Headquarters Ruling (HQ) H088521, dated May 13, 1991 (duty was applied by counting each crayon, eraser and sharpener within the set). In the instant case there are twenty-six (26) pieces in the Ronco “Six Star 25 Piece Knife Set with Injector.”
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not 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. 89-89, 54 Fed. Reg. 35127 (Aug. 23, 1989).
The subject merchandise is composed of different articles. Analyzing it under GRI 1, there is no single provision in the HTSUS that completely describes this product. Likewise, it is not classifiable under GRI 2(a) or 2(b), because the article is not in an unassembled or incomplete state. Rather, it is imported as a complete article and is a mixture of goods which are classifiable under two or more headings. GRI 2(b) instructs “[t]he classification of goods consisting of more than one material or substance shall be [determined] according to the principles of rule 3.”
GRI 3(a) does not apply because there is no heading that provides a specific description that clearly identifies an article like the subject merchandise that is a composite of cutlery that includes twenty knives, a cleaver, a chopper, a carving fork, poultry shears, a sharpener, and a plastic flavor injector. However, GRI 3(b) may apply, because the subject merchandise is a composite good consisting of different articles each of which, if imported separately, would be classifiable under different headings. According to GRI 3(b), “mixtures…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…” However, for a composite article to be analyzed pursuant to GRI 3(b) as a “set”, it must meet the requirements of EN(X) to GRI 3(b), which states, in relevant part:
For purposes of this Rule, the term “goods put up in sets for retail sale” shall be taken to mean goods which:
Consist of at least two different articles which are, prima facie, classifiable in different headings.
Consist of products or articles put up together to meet a particular nee or carry out a specific activity; and
Are put up in a manner suitable for sale directly to users without repacking (e.g. in boxes or cases or on boards).
The “Six Star 25 Piece Knife Set with Injector” meets the requirements of EN (X) to GRI 3(b). The knives are provided for in heading 8211, HTSUS (Knives), the poultry shears are provided for in heading 8213, HTSUS (Scissors), the cleaver and chopper are provided for in heading 8214, HTSUS (Other articles of cutlery…(kitchen cleavers, chopping or mincing knives…)), the carving fork is provided for in heading 8215, HTSUS (forks), the sharpener is provided for in heading 8205, HTSUS, (household tools, other), and the injector is provided for in heading 3924, (kitchenware…of plastics). Therefore it satisfies the first requirement. All the items can be used in the specific activity of cutting, chopping and preparing food, and they are imported in a manner suitable for sale directly to consumers, thus satisfying the second and third requirement. The subject merchandise is, therefore, a “set” for tariff purposes.
CBP’s next step then, is to consider which component imparts the set’s essential character for classification purposes. The EN (VIII) to GRI 3(b) is instructive here, and states that the factors which determine 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. In this case, the knives predominate by bulk and quantity. Ronco’s submission indicates that the weight of the knives and the value of the knives outweigh the other non-knife components (e.g. the shears, the fork, the sharpener, and the flavor injector). Therefore, the knives impart the essential character of the set, and guide classification at the heading level. The cutlery set is classified in heading 8211, HTSUS.
Counsel argues that the subject merchandise is not properly classifiable under subheading 8211.10.00, HTSUS because only sets of assorted articles all of which are items of heading 8211, HTSUS, may be considered a “set” under that subheading. However, CBP has issued an Informed Compliance Publication entitled, Cutlery of Headings 8211 through 8215 of the Harmonized Tariff Schedule of the United States, available at www.cbp.gov. This publication provides detailed explanations and many examples of cutlery and cutlery sets for tariff classification purposes. Therein, it notes that the ENs to subheading 8211.10, HTSUS, explain that the provision is limited in scope to “sets of different knives or sets of assorted articles in which the knives predominate in number over the other articles.” [Emphasis added] See Headquarters Ruling Letter (HQ) 967754, dated November 18, 2005, (classifying six 4 ½ steak knives, one 3-inch paring knife, one 5 ¼ inch utility knife, one 6-inch boning knife, one 8-inch bread knife, one 8-inch chef’s knife, one 7 ½ inch butchers’ knife, one pair of scissors, and a hardwood storage block to hold these components, as a set in subheading 8211.10, HTSUS, which provides for “sets of assorted articles”).
In the instant case, the cutlery set satisfies the EN to 8211.10, HTSUS because the knives predominate in number over the other (non-knife) articles. The cutlery set, composed of assorted articles, predominated by knives of heading 8211, HTSUS, is therefore classified under subheading 8211.10.00, HTSUS, which provides for, “Knives with cutting blades, serrated or not (including pruning knives), other than knives of heading 8208, and blades and other base metal parts thereof: Sets of assorted articles.”
Having ascertained that the subject merchandise is a “set,” CBP must next determine which article among the set has the highest rate of duty. This is calculated by determining the equivalent rate which of the price per piece in the set and the percentage ad valorem. Here, that is the poultry shears, which is provided for in subheading 8213.00.90, HTSUS, as “Scissors, tailors’ shears and similar shears, and blades and other base metal parts thereof: Valued over $1.75/dozen: Other (including parts).” The column one duty rate is 3 cents each plus 3% ad valorem, which results in an equivalent rate of 10.5% ad valorem. This is consistent with previous CBP rulings. See New York Ruling (NY) R00542, dated July 14, 2004; see also NY L88677, dated November 22, 2005.
HOLDING:
Under the authority of GRI 3(b), the subject merchandise is provided for in heading 8213, HTSUS. Specifically, in subheading, 8213.00.90, HTSUS, as “Scissors, tailors’ shears and similar shears, and blades and other base metal parts thereof: Valued over $1.75/dozen: Other (including parts).” The column one duty rate is 3 cents each plus 3% ad valorem, which results in an equivalent rate of 10.5% ad valorem.
The protest should be DENIED. Duty rates are provided for your convenience 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
You are to mail this letter together with the Customs Form 19 to the Protestant no later than 60 days from the date of this decision. Sixty days from the date of this letter, the Office of International Trade will make this decision available to Customs personnel, and to the general public on the Customs Home Page on the World Wide Web at www.cbp.gov by means of the Freedom of Information Act and by other methods of public distribution. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.
Sincerely,
Myles B. Harmon, Director
Commercial & Trade Facilitation Division