OT:RR:CTF:CPMMA H303761 AJK
TARIFF NO: 4811.90.20; 4811.90.90
Mr. Kevin Maher
C-Air Customhouse Brokers
181 So. Franklin Ave.
Valley Stream, NY 11581
RE: Revocation of NY K83080, NY K83204, NY K86534, NY L83248, NY I83703, NY J80696, NY L81409, and NY N099452; Modification of HQ 950774, NY G82351, NY N038315, and NY N217077; Modification by Operation of Law; Classification of Flocked Paper Sets
Dear Mr. Maher:
This letter is in reference to your New York Ruling Letters (NY) K83080, dated February 26, 2004, NY K83204, dated February 26, 2004, NY K86534, dated June 10, 2004, and NY L83248, dated March 18, 2005, concerning the tariff classification of flocked paper sets. In the aforementioned rulings, U.S. Customs and Broder Protection (CBP) classified the merchandise in heading 4823, Harmonized Tariff Schedule of the United States (HTSUS), as other paper. We have reviewed the rulings and have determined that the classification of flocked paper sets in heading 4823, HTSUS, was incorrect.
We have also reviewed Headquarters Ruling Letter (HQ) 950774, dated January 28, 1992, NY I83703, dated June 28, 2002, NY J80696, dated February 7, 2003, NY L81409, dated December 20, 2004, NY N099452, dated April 28, 2010, NY G82351, dated September 22, 2000, NY N038315, dated October 14, 2008, and NY N217077, dated June 5, 2012, concerning the tariff classification of flocked paper sets, and have determined that the aforementioned rulings were incorrect. For the reasons set forth below, we revoke eight ruling letters and modify four ruling letters.
In addition to the modification of the classification of flocked paper set, HQ 950774 is modified by operation of law with respect to the classification of flocked paper only. The modification by operation of law is precipitated by the change to note 7(A) to chapter 48, which previously stated that heading 4811, HTSUS, included paper in the form of rectangular sheets that exceeded 36 cm (14.17 inches) by 15 cm (5.9 inches) only. In 2002, however, note 7(A) to chapter 48 was replaced with note 8(b), and the general size limitation on goods of heading 4811, HTSUS, was removed. Accordingly, the classification of flocked paper in the form of 11 inches (27.94 cm) by 14 inches (35.56 cm) rectangular sheet in HQ 950774 is modified by operation of law.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. § 1625(c)(1)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057), a notice of the proposed action was published in the Customs Bulletin, Volume 55, No. 33, on August 25, 2021. No comments were received in response to the notice.
FACTS:
In all twelve rulings, the flocked paper sets contain flocked paper and an assortment of items to decorate flocked paper. Although all of the flocked paper sets are substantially similar as they consist of flocked paper, each set varies by component and size of flocked paper. In addition, some sets are contained in paperboard retail display boxes while others are merely packaged together as sets. The subject merchandise is described in NY K83080 as follows:
“Funtime Fuzzy Poster Value Set” … consists of the following items put up together for retail sale in a printed paperboard display box:
• 5 “fuzzy posters,” which are sheets of white paper, partially coated with black flock so as to form pictures and designs. The white, unflocked areas are meant to be colored in by the user. The “posters” range in size from 6” [15.24 cm] x 9” [22.86 cm] to 16” [40.64 cm] x 20” [50.8 cm].
• A “fuzzy portfolio,” which is a paperboard pocket folder measuring 9½” x 11½” in the closed position. Its face has a flocked design suitable for coloring.
• 8 washable markers in assorted colors.
• A packet of sequins.
• A small tube of white glue.
• A wooden “design stick” to assist in the application of the sequins.
ISSUE:
Whether the flocked paper sets are classified in heading 4811, HTSUS, as covered or surface decorated rectangular sheets of paper; heading 4823, HTSUS, as other paper; heading 4911, HTSUS, as other printed matter; or heading 9608, HTSUS, as ball point pens.
LAW AND ANALYSIS:
Classification of goods under the HTSUS is governed by the General Rules of Interpretation (GRI). GRI 1 provides that classification 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.
GRI 3(b) states, in pertinent part:
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.
* * * * * *
The HTSUS provisions at issue are as follows:
4811 Paper, paperboard, cellulose wadding and webs of cellulose fibers, coated, impregnated, covered, surface-colored, surface-decorated or printed, in rolls or rectangular (including square) sheets, of any size, other than goods of the kind described in heading 4803, 4809 or 4810:
4811.90 Other paper, paperboard, cellulose wadding and webs of
cellulose fibers:
In strips or rolls of a width exceeding 15 cm or in
rectangular (including square) sheets with one side exceeding 36 cm and the other side exceeding 15 cm in the unfolded state:
Other:
4811.90.20 Wholly or partly covered with flock,
gelatin, metal or metal solutions
4811.90.90 Other
***
4823 Other paper, paperboard, cellulose wadding and webs of cellulose fibers,
cut to size or shape; other articles of paper pulp, paper, paperboard,
cellulose wadding or webs of cellulose fibers:
4823.90 Other:
Other:
Other:
Of coated paper or paperboard:
4823.90.67 Other
Other:
4823.90.86 Other
***
4911 Other printed matter, including printed pictures and photographs:
Other:
4911.91 Pictures, designs and photographs:
Printed not over 20 years at time of importation:
Other:
4911.91.40 Other
***
9608 Ball point pens; felt tipped and other porous-tipped pens and markers; fountain pens, stylograph pens and other pens; duplicating styli; propelling or sliding pencils (for example, mechanical pencils); pen-holders, pencil-holders and similar holders; parts (including caps and clips) of the foregoing articles, other than those of heading 9609:
9608.20.00 Felt tipped and other porous-tipped pens and markers
Note 2 to chapter 49 provides, in pertinent, as follows:
2. For the purposes of chapter 49 the term "printed" also means reproduced by means of a
duplicating machine, produced under the control of an automatic data processing machine, embossed, photographed, photocopied, thermocopied or typewritten.
* * * * * *
The Harmonized Commodity Description and Coding System (HS) Explanatory Notes (ENs) constitute the official interpretation of the HS. While not legally binding or dispositive, the ENs provide a commentary on the scope of each heading of the HS at the international level, and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127 (Aug. 23, 1989).
EN to GRI 3(b) provides, in pertinent part:
(X) For the 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 need or
carry out a specific activity; and
are put up in a manner suitable for sale directly to end users without repacking (e.g., in boxes or cases or on boards).
The term “goods put up in sets for retail sale” therefore only covers sets consisting of goods which are intended to be sold to the end user where the individual goods are intended to be used together.
EN to chapter 49 provides, in pertinent part:
For the purposes of this Chapter, the term “printed” includes not only reproduction by the several methods of ordinary hand printing (e.g., prints from engravings or woodcuts, other than originals) or mechanical printing (letterpress, offset printing, lithography, photogravure, etc.), but also reproduction by duplicating machines, production under the control of an automatic data processing machine, embossing, photography, photocopying thermocopying or typewriting (see Note 2 to this Chapter), irrespective of the form of the characters in which the printing is executed (e.g., letters of any alphabet, figures, shorthand signs, Morse or other code symbols, Braille characters, musical notations, pictures, diagrams). The term does not, however, include coloration or decorative or repetitive-design printing.
EN 48.11 provides, in pertinent part, as follows:
Paper and paperboard are classified in this heading only if they are in strips or rolls or in rectangular (including square) sheets, of any size. If they have been cut to any other shape, they fall in later headings of this Chapter (for example, 48.23). Subject to these conditions and the exceptions mentioned in the heading and those referred to at the end of this Explanatory Note, this heading applies to the following in rolls or sheets:
(A) Paper, paperboard, cellulose wadding and webs of cellulose fibres, to which superficial coatings of materials other than (emphasis added) kaolin or other inorganic substances have been applied over the whole or part of one or both surfaces (e.g., thermosensitive paper used, for example, in telefax machines).
EN 48.23 provides, in pertinent part, as follows:
This heading includes:
Paper and paperboard, cellulose wadding and webs of cellulose fibres, not covered
by any of the previous headings of this Chapter:
in strips or rolls of a width not exceeding 36 cm;
in rectangular (including square) sheets of which no side exceeds 36 cm in
the unfolded state;
cut to shape other than rectangular (including square) ….
EN 49.11 provides, in pertinent part:
This heading covers all printed matter (including photographs and printed pictures) of this Chapter (see the General Explanatory Note above) but not more particularly covered by any of the preceding headings of the Chapter.
* * * * * *
As a preliminary matter, we note that each flocked paper set in the aforementioned rulings varies in component, packaging material, and form and size of the flocked paper parts. Each set consists of a variety of items (e.g., flocked paper, pen[s] or marker[s], glue stick, glitter, etc.) that comprise the flocked paper set and are packaged together for retail sale. Among the rulings, some flocked paper sets are packaged in paperboard retail display boxes. Moreover, the size and form of the flocked paper parts in these sets vary as some are imported in rolls of flocked paper while others are in the form of rectangular sheets in various sizes. As explained below, however, the difference in each flocked paper set does not affect our analysis.
The classification of flocked paper sets is determined by the application of GRI 3(b), which applies to “[g]oods put up in sets for retail sale”. The General EN to GRI 3(b) defines “sets for retail sale” as “goods which are intended to be sold to the end user where the individual goods are intended to be used together.” In the instant case, the flocked paper sets constitute “sets for retail sale” because the merchandise consists of multiple items with distinctly classifiable headings while no specific provision encompasses the set as a whole. Moreover, the components of the sets are put up together for the final consumers to decorate flocked paper, and the sets are packaged together for sale without repackaging after importation. See EN to GRI 3(b). In NY N038315, however, CBP analyzed a flocked paper set, which contained markers, a glue stick, flocked paper, plastic stick-on jewels, and sequins, and incorrectly classified each component of the flocked paper set in its corresponding heading. It is now CBP’s position that the flocked paper set in NY N038315 constitutes a set for retail sale under GRI 3(b). Pursuant to GRI 3(b), therefore, the flocked paper sets are “sets for retail sale” for classification purposes and thus, they are classified as a whole, not by the individual components of the set.
To classify under GRI 3(b), CBP must identify the component of the subject merchandise that imparts the merchandise with its essential character. “The ‘essential character’ of an article is ‘that which is indispensable to the structure, core or condition of the article, i.e., what it is.’” Structural Industries v. United States, 360 F. Supp. 2d 1330, 1336 (Ct. Int’l Trade 2005). Accordingly, the flocked paper sets are classified in the heading in which the component that imparts the essential character of the subject merchandise is classified. In the instant case, the flocked paper sets are commonly marketed as velvet or fuzzy art sets and they are sold by showcasing the flocked paper parts. Moreover, the flocked paper sets are comprised of items that are necessary for the activity of crafting flocked paper. For example, the pens or markers are utilized to color the unflocked spaces of flocked paper while the glue and glitters are similarly used to decorate flocked paper. In HQ 950774, CBP found that the pens and flocked paper in flocked paper sets were equally significant and thus, classified the merchandise in heading 9608, HTSUS, as pens, under GRI 3(c). As explained above, however, the pens contained in these sets do not impart the essential character of the merchandise because they are merely auxiliary components that support the user’s utility of flocked paper—to color, craft, and decorate flocked paper. Under GRI 3(b), the essential character of the flocked paper sets is imparted by the flocked paper parts and thus, the classification of the merchandise in the heading of other components—such as heading 9608, HTSUS—is precluded.
Heading 4911, HTSUS, provides for other printed matter. The EN to chapter 49 defines “printed” as “reproduction by the several methods of ordinary hand printing (e.g., prints from engravings or woodcuts, other than originals) or mechanical printing (letterpress, offset printing, lithography, photogravure, etc.), but also reproduction by duplicating machines, production under the control of an automatic data processing machine, embossing, photography, photocopying thermocopying or typewriting”. See also Note 2 to Chapter 49. Moreover, the Merriam-Webster Dictionary defines “print” as “to make a copy of by impressing paper against an inked printing surface”. Print, Merriam-Webster, https://www.merriam-webster.com/dictionary/print (last visited May 7, 2021). Accordingly, flocked papers do not qualify as “printed” matter within the HTSUS due to the distinct process of flocking paperboard. Unlike the process of printing, which is a reproduction process by impressing paper against an inked printing surface either via hand or machine, flocked paper is created by partially covering paper with flock; it does not undergo a reproduction or printing process as prescribed in the EN to chapter 49. In NY G82351, however, CBP incorrectly classified a flocked paper set and flocked paper in heading 4911, HTSUS, as printed matter. Because flocked paper—which is a paper covered with flock—is not a reproduced or printed product, it is not classifiable in heading 4911, HTSUS, as other printed matter.
EN 48.11 states that heading 4811, HTSUS, includes covered paper that contains “superficial coatings of materials other than kaolin or other inorganic substances” (emphasis added). To be classified in this heading, however, the paper must be “in strips or rolls or in rectangular (including square) sheets ….” See EN 48.11. As such, paper that has been cut to any shape other than rectangular or square sheets are classified in heading 4823, HTSUS, as other paper. See id.; see also EN 48.23. Accordingly, the subject flocked paper in all twelve rulings are classified in heading 4811, HTSUS, because the papers, which are in the form of strips and rectangular sheets, are partially covered in flock, thereby creating a decoration. Thus, flocked paper is properly classified in heading 4811, HTSUS, as covered paper.
Specifically, subheading 4811.90.20, HTSUS, is an eo nomine provision for paper covered with flock. This subheading, however, encompasses flocked paper that are “in strips or rolls of a width exceeding 15 cm [5.9 inches] or in rectangular (including square) sheets with one side exceeding 36 cm [14.17 inches] and the other side exceeding 15 cm [5.9 inches] in the unfolded state” only. Thus, the flocked paper sets in NY K83204, NY K86534, NY L83248, and NY L81409 in part are classified in subheading 4811.90.20, HTSUS, as paper covered with flock, because they fall within the specified measurements. However, the flocked paper sets in NY I83703, NY J80696, NY L81409 in part, NY N099452, NY G82351, NY N038315, and
NY N217077 are classified in subheading 4811.90.90, HTSUS, as other covered paper, because they do not meet the specified measurements for subheading 4811.90.20, HTSUS, and are thus excluded therefrom.
HOLDING
By application of GRI 3(b), the subject flocked paper sets are classified in heading 4811, HTSUS. The flocked paper sets with flocked paper that are in strips or rolls of a width exceeding 15cm (5.9 inches) or in rectangular or square sheets with one side exceeding 36 cm (14.17 inches) and the other side exceeding 15 cm (5.9 inches) are classified in subheading 4811.90.20, HTSUS, which provides for “[p]aper, paperboard, cellulose wadding and webs of cellulose fibers, coated, impregnated, covered, surface-colored, surface-decorated or printed, in rolls or rectangular (including square) sheets, of any size, other than goods of the kind described in heading 4803, 4809 or 4810: [o]ther paper, paperboard, cellulose wadding and webs of cellulose fibers: [i]n strips or rolls of a width exceeding 15 cm or in rectangular (including square) sheets with one side exceeding 36 cm and the other side exceeding 15 cm in the unfolded state: [o]ther: [w]holly or partly covered with flock, gelatin, metal or metal solutions”. The 2021 column one, general rate of duty is free.
Alternatively, the flocked paper sets with flocked paper that are smaller than the measurements outlined above are classified in subheading 4811.90.90, HTSUS, which provides for “[p]aper, paperboard, cellulose wadding and webs of cellulose fibers, coated, impregnated, covered, surface-colored, surface-decorated or printed, in rolls or rectangular (including square) sheets, of any size, other than goods of the kind described in heading 4803, 4809 or 4810: [o]ther paper, paperboard, cellulose wadding and webs of cellulose fibers: [o]ther”. The 2021 column one, general rate of duty is free.
In accordance with the change of note 7(A) to chapter 48 in 2002, the flocked paper in HQ 950774 that was classified in heading 4823, HTSUS, is now classified in heading 4811, HTSUS, specifically subheading 4811.90.90, HTSUS, which provides for “[p]aper, paperboard, cellulose wadding and webs of cellulose fibers, coated, impregnated, covered, surface-colored, surface-decorated or printed, in rolls or rectangular (including square) sheets, of any size, other
than goods of the kind described in heading 4803, 4809 or 4810: [o]ther paper, paperboard, cellulose wadding and webs of cellulose fibers: [o]ther”. The 2021 column one, general rate of duty is free.
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 at www.usitc.gov.
EFFECT ON OTHER RULINGS:
NY K83080, dated February 26, 2004, NY K83204, dated February 26, 2004,
NY K86534, dated June 10, 2004, NY L83248, dated March 18, 2005, NY I83703, dated June 28, 2002, NY J80696, dated February 7, 2003, NY L81409, dated December 20, 2004, and
NY N099452, dated April 28, 2010, are hereby revoked.
NY G82351, dated September 22, 2000, NY N038315, dated October 14, 2008, and
NY N217077, dated June 5, 2012, are modified. In addition, HQ 950774, dated January 28, 1992, is modified in part by operation of law with respect to the classification of the flocked paper only.
Sincerely,
for
Craig T. Clark, Director Commercial and Trade Facilitation Division
CC: Ms. Lorianne Aldinger
Rite Aid Corporation
P.O. Box 3165
Harrisburg, PA 17105
Mr. Joseph Stinson
Liss Global, Inc.
7746 Dungan Road
Philadelphia, PA 19111
Mr. Daniel Shapiro
Tompkins & Davidson, LLP
One Astor Plaza
1515 Broadway
New York, NY 10036-8901
Ms. Krista B. Ruffoni
Family Dollar Services, Inc.
10401 Monroe Road
Matthews, NC 28105
Ms. Theresa Buell
Western Graphics Corp.
P.O. Box 22310
Eugene, OR 97402-0417
Mr. Michael J. Mercer
Corbett International, Inc.
Cargo Service Building 80
J.F.K. International Airport
Jamaica, N.Y. 11430