CLA-2 RR:CR:GC 961395 PH

Port Director
U.S. Customs Service
40 South Gay Street
Baltimore, MD 21202

RE: Protest 1303-98-100006; glassware; conveyance or packing of goods; glassware for table, kitchen, toilet, office, indoor decoration; household storage articles; principal use; 7010; 7013; U.S. Additional Note 1(a); T.D. 96-7; Group Italglass U.S.A., Inc. v. United States; Kraft, Inc, v. United States; G. Heileman Brewing Co. v. United States; United States v. Carborundum Company; HQ 959638

Dear Port Director:

This is in response to protest 1303-98-100006, which pertains to the tariff classification of certain articles of glass under the Harmonized Tariff Schedule of the United States (HTSUS). A sample was submitted for our examination.

FACTS:

The merchandise consists of a cylindrically shaped jar of heavy glass, with an enlarged base, a large rim and no neck. The article is approximately 14" high and the diameter of the body is 2 7/8" and that of the base is 4 1/4". The size of the article is stated to be 1,062 ml. The article is fitted with a specially shaped cork closure (broad flat top surface 3" in diameter, with a narrower closure portion 2 1/4" in diameter). The glass has seams, and on the base, in raised letters, is the inscription "[name] House of Nuts".

The merchandise was entered on August 29, 1996, and after proper extension of liquidation and notice thereof, the entry was liquidated on November 7, 1997. On February 2, 1998, counsel for the importer filed this protest.

Citing Group Italglass U.S.A., Inc. v. United States, 17 CIT 226 (1993), Kraft, Inc, v. United States, 16 CIT 483 (1992), Harmonized Commodity Description And Coding System Explanatory Note (EN) 70.10 and Treasury Decision (T.D.) 96-7, the protestant contends that the glassware is properly classified in heading 7010, HTSUS, as containers of glass of a kind used for the conveyance or packing of goods. Specifically, the protestant argues that "EN 70.10 makes it clear that the heading covers containers of all shapes and sizes which are used as containers for foods, including those designed for use with ordinary closures or stoppers of cork." On the basis of Kraft, supra, the protestant argues:

As the Kraft case demonstrates, an unusual or uniquely shaped container such as [that under consideration] functions to attract the attention of consumers to the products packed inside, and to compel a purchaser to select one product over another. The use of a container more attractive to a consumer does not preclude the glassware from being a part of a class of containers used for the conveyance or packing of goods classifiable under heading 7010.

In regard to the criterion on the use of a "hot packing" process in T.D. 96-7, the protestant states that popcorn is a foodstuff product that does not require such a process to remain fresh for consumers. In regard to the other criteria in T.D. 96-7, the protestant states that the articles are imported from the manufacturer by the importer and sold to a food packer who fills them with popcorn, they are never sold empty directly to the consumer, they are displayed and sold in an environment that features the food in the container and not the container, they are used commercially to convey (sell) food, they are designed to attract the consumer's attention to the product in an attempt to increase sales, and they are not intended to be reused.

The HTSUS headings under consideration, are as follows:

7010.91.50: [c]arboys, bottles, flasks, jars, pots, vials, ampoules and other containers, of glass, of a kind used for the conveyance or packing of goods; preserving jars of glass; stoppers, lids and other closures, of glass: ... [o]ther, of a capacity: [e]xceeding 1 liter: ... [o]ther containers (with or without their closures).

Goods classifiable under subheading 7010.91.50 receive duty-free treatment.

7013.39.20: [g]lassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes (other than that of heading 7010 or 7018): ... [g]lassware of a kind used for table (other than drinking glasses) or kitchen purposes other than that of glass-ceramics: [o]ther: ... [o]ther: [v]alued not over $3 each.

The 1996 general column one rate of duty for goods classifiable under this provision is 28.5% ad valorem.

ISSUE:

Whether the glassware is classifiable as a container of a kind used for the conveyance or packing of goods under subheading 7010.91.50, HTSUS, or glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes under heading 7013.39.20, HTSUS.

LAW AND ANALYSIS:

Initially, we note that the protest was timely filed (i.e., within 90 days after but not before the notice of liquidation; see 19 U.S.C. 1514(c)(3)(A)) and the matter protested is protestable (see 19 U.S.C. 1514(a)(2) and (5)).

The classification of merchandise under the HTSUS is governed by the General Rules of Interpretation (GRI's). GRI 1, HTSUS, states, in pertinent part, that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes.

The Harmonized Commodity Description And Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not legally binding on the contracting parties, and therefore not dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and are thus useful in ascertaining the classification of merchandise. Customs believes the ENs should always be consulted. See T.D. 89-80, published in the Federal Register August 23, 1989 (54 FR 35127, 35128).

The provision in heading 7010, HTSUS, for containers "of a kind used" for the conveyance or packing of goods and the provision in heading 7013, HTSUS, for glassware "of a kind used" for table or kitchen purposes are "principal use" provisions (Group Italglass U.S.A., Inc. v. United States, 17 CIT 226 (1993)). If an article is classifiable according to the use of the class or kind of goods to which it belongs, as is true of these provisions, Additional U.S. Rule of Interpretation 1(a), HTSUS, provides that:

In the absence of special language or context which otherwise requires-- (a) a tariff classification controlled by use (other than actual use) is to be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong, and the controlling use is the principal use[.]

In other words, the article's principal use in the United States at the time of importation determines whether it is classifiable within a particular class or kind (principal use is distinguished from actual use; a tariff classification controlled by the latter is satisfied only if such use is intended at the time of importation, the goods are so used and proof thereof is furnished within 3 years after the date the goods are entered (U.S. Additional Note 1(b); 19 CFR 10.131 - 10.139)).

The Courts have provided factors, which are indicative but not conclusive, to apply when determining whether merchandise falls within a particular class or kind. They include: general physical characteristics, expectation of the ultimate purchaser, channels of trade, environment of sale (accompanying accessories, manner of advertisement and display), use in the same manner as merchandise which defines the class, economic practicality of so using the import, and recognition in the trade of this use. (See Kraft, Inc, v. United States, 16 CIT 483 (1992), G. Heileman Brewing Co. v. United States, 14 CIT 614 (1990), and United States v. Carborundum Company, 63 CCPA 98, C.A.D. 1172, 536 F.2d 373 (1976), cert. denied, 429 U.S. 979 (1976).)

In applying Additional U.S. Rule of Interpretation 1(a), HTSUS, and the above cases to heading 7010, HTSUS, it is Customs position that, as a general rule, a glass article's physical form will indicate its principal use and thus to what class or kind it belongs. However, should an exception arise so that an article's physical form does not indicate to what class or kind it belongs or its physical form indicates it belongs to more than one class or kind, Customs considers the other enumerated principal use criteria.

EN 70.10 states, in pertinent part: "This heading covers all glass containers of the kind commonly used commercially for the conveyance or packing of liquids or of solid products (powders, granules, etc.). ..." The key phrase in the quoted material is "commonly used commercially for the conveyance or packing" of liquids or solid products. The root word of "commercially" is commerce which is described as the exchange or buying and selling of commodities. The Random House Dictionary of the English Language (1973), p. 295, and Webster's New World Dictionary (3rd Coll. Ed.) (1988), p. 280. The root word of "conveyance" is convey which is described as to carry, bring or take from one place to another; transport; bear. Supra, at p. 320 and p. 305, respectively.

Based on the above authorities Customs issued Treasury Decision (T.D.) 96-7 which, among other things, adopted certain criteria as indicative, but not conclusive, of whether a particular glass article qualifies as part of the class "containers of glass of a kind used for the conveyance or packing of goods" in heading 7010, HTSUS, or the class "glassware of a kind used for table or kitchen purposes; glass storage articles" in heading 7013, HTSUS.

The criteria in T.D. 96-7 for containers of glass of a kind used for the conveyance or packing of goods in heading 7010, HTSUS, are:

1. [The container] generally [has] a large opening, a short neck (if any) and as a rule, a lip or flange to hold the lid or cap, [is] made of ordinary glass (colourless or coloured) and [is] manufactured by machines which automatically feed molten glass into moulds where the finished articles are formed by the action of compressed air;

2. [T]he ultimate purchaser's primary expectation is to discard/recycle the container after the conveyed or packed goods are used;

3. [The container is] sold from the importer to a wholesaler/distributor who then packs the container with goods;

4. [The container is] sold in an environment of sale that features the goods packed in the container and not the jar itself;

5. [The container is] used to commercially convey foodstuffs, beverages, oils, meat extracts, etc.;

6. [The container is] capable of being used in the hot packing process; and

7. [The container is] recognized in the trade as used primarily to pack and convey goods to a consumer who then discards the container after this initial use.

Applicability of the foregoing criteria to the merchandise is as follows. The article appears to be manufactured by automatic machine from ordinary glass. The article has a relatively large opening, is not configured to "hold" a lid or cap, other than having a rim with which a cork or similar closure may be used, and has no neck.

An ultimate purchaser's primary expectation would not be to discard or recycle the article after the conveyed or packed goods, if any, are used, as evidenced by the fact that the article is configured only for a cork or similar closure, and such closures allow for repetitive, extremely easy, opening and closing, a feature indicating reusability. This is also evidenced by the decorative, relatively unusual shape of the article, fitting it for use in the kitchen for decorative storage of various kinds of dry goods (e.g., spaghetti and other pastas, various kinds of beans).

The protestant states that the article is sold from the importer to a food packer who fills it, but there is no evidence as to whether this is so for the class or kind involved (we emphasize, as stated above (citing Italglass, supra), that the competing tariff provisions are principal use provisions, not actual use provisions). There is no evidence as to whether the container is emphasized over the goods packed in it, but the physical form of the article (special or relatively unusual shape, configuration for a cork or similar closure allowing for repetitive, easy opening and closing) indicates that this is so.

The criterion of commercial use to convey foodstuffs, etc., is addressed by the other criteria (see above and below). There is no evidence that the container is capable of being used in the hot packing process. The physical form of the article (see above) indicates that rather than using the container to pack and convey goods to a consumer who discards it after its initial use, the container, and not its contents, is emphasized to customers. On the basis of these criteria, we conclude that this article is not principally used for the conveyance or packing of goods. Classification under heading 7010, HTSUS, is precluded.

Insofar as the protestant's arguments on the basis of EN 70.10 and Kraft, supra, are concerned, we concur that, as the EN states, heading 7010, HTSUS may include the containers enumerated therein "of all shapes and sizes" and that such containers "generally have ... a lip or flange to hold the lid or cap [although] [s]ome ... may be closed by corks or screw stoppers." However, as stated above and as the EN makes clear, the critical property for containers covered by heading 7010 is that they must be "of the [kind] commonly used commercially for the conveyance or packing of liquids or of solid products." The determination of whether a container is of the kind so used is made on the basis of the analysis of the criteria for principal use (see above). In regard to the "bear jars" in Kraft, there are many distinctions between those jars and the containers in this protest. Those distinctions include at least the following:

"Bear jars" not used to pack food products were destroyed (16 CIT at 487); there is no evidence that this is so for the articles under protest.

The "bear jars" have the parts which "[g]lass containers used to pack, transport or market food products have ... [including] a sealing surface, glass lugs used to attach the closure, the finish (which refers to the sealing surface and the glass lugs), the body (which includes the shoulder, the sidewall and the heel), the mold seam, and the bearing surface which supports the jar on the shelf [which parts] are essential" (16 CIT at 487). That is, despite their somewhat unusual shape, the Court found that "[t]he bear jars, at least because of the lug finish, the mold seam, and the utilities lid necessitated by the lug finish, are not particularly handsome" and "are clearly not decorative" (16 CIT at 488). The only parts of the above-enumerated "essential" parts which the articles under protest have are the mold seam and the bearing surface; further, the special shape of the article and the cork closure presented with the sample are decorative.

The "bear jars" were packed using the "hot pack process" (16 CIT at 487); "[t]he physical characteristics of the usual and ordinary glass containers used to pack and market food products [include the requirement that] such glass containers must be designed for use in the hot pack process" (16 CIT at 489); there is no evidence that this is so for the articles under protest.

Plaintiff provided evidence that the "bear jars" were used in a promotional program to market strawberry jam and grape jelly and, in such programs "[t]he container provides the physical means of delivering the food product to the consumer and establishes the image of the product in the consumer's mind[;] [t]he design of the package also attracts the consumer's attention to the food product in the store" (16 CIT at 487-488). The example used by the Court in this regard (Mrs. Butterworth's pancake syrup containers) (16 CIT at 488), makes clear that one of the reasons that the somewhat unusually shaped "bear jars" were found to be containers for the packing, transporting, or marketing of merchandise was the promotional program emphasizing the shape of the "bear jars" with a particular producer's footstuff. There is no evidence of such a promotional program for the articles under protest.

The article is classified under heading 7013, HTSUS. The protestant provides no evidence regarding the principal use of the items, but many of the criteria used in the analysis of the applicability of heading 7010, HTSUS, support principal use as a household storage article (see above, e.g., the closure allows for repetitive, extremely easy, opening and closing; when sold filled, the physical form shows that the container, not the contents, is emphasized; see also the criteria stated in T.D. 96-7 for glassware of a kind used for table or kitchen purposes (glass storage articles)). Accordingly, the article is principally used to store food material and is classifiable as glassware of a kind used for table (other than drinking glasses) or kitchen purposes other than that of glass-ceramics, in subheading 7013.39.20, HTSUS. This is consistent with Headquarters Ruling (HQ) 959638 dated October 10, 1997.

HOLDING:

The glassware is classifiable as glassware of a kind used for table (other than drinking glasses) or kitchen purposes, in subheading 7013.39.20, HTSUS.

The protest is DENIED. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed, with the Customs Form 19, by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, Freedom of Information Act, and other public access channels.

Sincerely,

John Durant, Director,
Commercial Rulings Division