CLA-2 RR:CR:GC 961409 PH

Port Director
U.S. Customs Service
33 New Montgomery Street, # 1501
San Francisco, CA 94105

RE: Protest 2809-97-101371; glassware; conveyance or packing of goods; glassware for table, kitchen, toilet, office, indoor decoration; household storage articles; principal use; 7010; 7013; 7020; 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; HQs 959639; 959941; 961395

Dear Port Director:

This is in response to protest 2809-97-101371, which pertains to the tariff classification of certain articles of glass under the Harmonized Tariff Schedule of the United States (HTSUS). Pictorial representations were submitted for our examination.

FACTS:

One entry, dated February 14, 1997, is included in the protest, which is against the classification of three styles of glassware, # 03763, 05379, and 06065, described in the following table.

Code/Ref. Denomination Description

03763 Bott. Duca 500 F Four sides, tall, long neck, rim. Protestant states that the article is used to pack olive oil.

06065 Bott. Tromba 750 BP MB Conical shape in the form of a trumpet or horn, with a handle and "mock finger tabs", rim. Protestant states that the article is purchased by a bottler of brandy.

05379 Bott. MG Bord Francese Lt 6 S Cylindrical shape (typical wine-bottle shape), moderate length neck, rim, has a "punt" (or "push-up bottom"), as in a typical wine bottle. Protestant states that the article is filled with wine.

The entry was liquidated on September 19, 1997. Item # 03763 and 06065 were classified in subheading 7013.39.20, HTSUS, and item # 05379 was classified in subheading 7020.00.60, HTSUS. On December 18, 1997, 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 bottle 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 there are many types of foods and beverages that do not require the type of hermetic seal created by the hot packing process, such as wine, vinegars, and olive oil infusion-type products, as well as dry goods and non-food items. 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 wineries or food processors which fill them with wine or food products, they are never sold empty directly to the consumer, they are ultimately displayed and sold in an environment that features the wine or food in the container and not the container, they are used commercially to convey beverages or food, they are recognized in the trade as used primarily to pack and convey wine to a consumer and, in particular regard to item # 06065, are designed to attract the consumer's attention to the product in an attempt to increase sales, and they are only reusable in the same manner as any other glass container in which food products are packed and marketed.

The HTSUS headings under consideration, are as follows:

7010: Carboys, 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.

Goods classifiable under subheading 7010.91.50 ("... [o]ther, of a capacity: [e]xceeding 1 liter: ... [o]ther containers (with or without their closures)"), or 7010.92.50 ("... [o]ther, of a capacity: ... [e]xceeding 0.33 liter but not exceeding 1 liter: ... [o]ther containers (with or without their closures)") receive duty-free treatment.

7013: Glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes (other than that of heading 7010 or 7018).

The 1997 general column one rate of duty for goods classifiable under subheading 7013.39.20 ("... [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") is 27.8% ad valorem. The 1997 general column one rate of duty for goods classifiable under subheading 7013.39.60 ("... [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 over $3 each: ... [o]ther: ... [v]alued over $5 each") is 7.2% ad valorem.

7020: Other articles of glass

The 1997 general column one rate of duty for goods classifiable under subheading 7020.00.60 ("... [o]ther") is 5.6% ad valorem.

ISSUE:

Whether the glassware is classifiable as containers of a kind used for the conveyance or packing of goods under heading 7010, HTSUS, glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes under heading 7013, HTSUS, or other articles of glass under heading 7020, 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).

Subheading 7020.00.60, HTSUS, is a so-called "basket" provision, in which classification "is appropriate only when there is no tariff category that covers the merchandise more specifically" (Apex Universal, Inc., v. United States, CIT Slip Op. 98-69 (May 21, 1988)). Therefore, we are first addressing the other competing provisions. Only if classification in these provisions is precluded will we address classification in subheading 7020.00.00, HTSUS.

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. Each of the articles appears to have been manufactured by automatic machines from ordinary glass. Each article has a relatively small opening and is not configured to "hold" a lid or cap, other than having a rim with which a cork or similar closure may be used. Each item has a long or moderately long neck (item # 06065, because of its unique shape, does not have a neck as such, but the portion of the article leading to the opening is similar to a relatively long neck).

In the case of item # 05379, the article is similar in shape to an ordinary wine bottle and has a "punt" (or "push-up" bottom) as is typical of such containers. The protestant states that the container is sold from the importer to a winery which fills it, as its physical shape indicates, with wine. There is no evidence as to whether the container is emphasized over the goods packed in it, but the physical form of the article (see above) indicates that this is not 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 it is used to pack and convey goods to a consumer who discards it after its initial use. On the basis of these criteria (in particular, the physical shape of the article, including the "punt"), we conclude that item # 05379 is of the class or kind of goods principally used for the conveyance or packing of goods. The article is properly classified under heading 7010, HTSUS, and, therefore, may not be classified under heading 7013, HTSUS, as specifically provided in heading 7013. Item # 05379 is classifiable as a container of glass of a kind used for the conveyance or packing of goods in subheading 7010.91.50, HTSUS.

This classification of item # 05379 is consistent with Headquarters Ruling (HQ) 959941 dated October 27, 1997 (see item # B4300 in that ruling). We note that HQ 959639 dated October 21, 1997, held certain large containers (2 to 6 liters), one of which had a style number and denomination similar to item # 05379, to be classifiable under heading 7013, HTSUS. However, there is no evidence in HQ 959639, or the file therefore, that the containers involved therein had the shape of an ordinary wine bottle and, in particular, there is no evidence that those containers had a "punt". This ruling is distinguished from HQ 959639 on that basis.

Insofar as item # 03763 and 06065 are concerned, an ultimate purchaser's primary expectation would not be to discard or recycle the articles after the conveyed or packed goods, if any, are used, as evidenced by the decorative shape of each item (trumpet or horn shape for item # 06065; geometric shape and long neck for item # 03763). This is also evidence by the fact that each item is configured only for a cork or similar closure, and such closures allow for repetitive, extremely easy, opening and closing, a feature indicating reusability.

The protestant states that the containers are sold from the importer to a customer who fills them, but there is no evidence as to whether this is so for the class or kind involved (we emphasize, as stated above, that the competing tariff provisions are principal use provisions, not actual use provisions). There is no evidence as to whether the containers are emphasized over the goods packed in them, but the physical form of the articles (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 containers are capable of being used in the hot packing process. The physical form of the articles (see above) indicates that rather than using the containers to pack and convey goods to a consumer who discards them after their initial use, the containers, and not their contents, are emphasized to customers. On the basis of these criteria, we conclude that item # 03763 and 06065 are not principally used for the conveyance or packing of goods. Classification under heading 7010, HTSUS, is precluded.

Item # 03763 and 06065 are 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 household storage articles (see above, e.g., closures allow for repetitive, extremely easy, opening and closing; when sold filled, the decorative 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, these items are principally used to store food material and are 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.

Insofar as the protestant's arguments on the basis of EN 70.10 and Kraft, supra, are concerned, see HQ 961395 dated October 20, 1998, addressing similar arguments made by the same protestant in regard to another protest.

HOLDINGS:

(1) Item # 05379 is classifiable as an other bottle of glass of a kind used for the conveyance or packing of goods of a capacity exceeding 1 liter, in subheading 7010.91.50, HTSUS.

(2) Item # 03763 and 06065 are classifiable as other glassware of a kind used for table (other than drinking glasses) or kitchen purposes, in subheading 7013.39.20, HTSUS.

The protest is GRANTED IN PART (as to item # 05379) and DENIED in part (as to item # 03763 and 06065). 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