CLA-2 CO:R:C:G 084580 WAW
District Director of Customs
U.S. Customs Service
555 Battery Street
San Francisco, CA 94126
RE: Decision on Application for Further Review of Protest No.
28096-001679; Classification of Film Sheet for Food Pouch
Dear Sir:
This is a decision on an application for further review of a
protest timely filed October 3, 1986, against your decision in
the classification of a film sheet for a food pouch under the
Tariff Schedules of the United States Annotated (TSUSA). The
following is a list of the nine entries which are the subject of
this protest:
Entry Entered Liquidated
138424-7 4/30/85 7/7/86
138797-2 7/2/85 7/7/86
138922-6 7/22/85 7/7/86
213689 11/15/85 7/7/86
294253-9 1/29/86 7/7/86
294279-1 2/6/86 7/7/86
294398-1 2/20/86 7/7/86
294974-9 4/23/86 7/7/86
295570-4 6/30/86 9/19/86
all of which covered shipments of plastic film sheets. Our
decision follows.
FACTS:
The merchandise at issue consists of 16-1/2 inch metallized
nylon film sheets that are designed to be used for packaging
ground coffee. A laboratory analysis performed by the U.S.
Customs Service indicates that the plastic sheet consists
essentially of one layer of nylon and another layer of an
ethylene vinyl acetate copolymer material with an aluminum
coating. Based on the laboratory analysis, the sheets do not
contain any evidence of magnetic ink markings which are designed
to trigger the cutting and wrapping process. The plastic film
sheets are manufactured in Japan.
At the time of entry of the goods, your office classified
the plastic film sheets in item 774.55, TSUS, which provides for
articles not specially provided for, of rubber or plastics:
Other: Other. The protestant, however, maintains that the
flexible film material is used for packaging ground coffee for
Brewpak MJB on vertical form and fill (VFF) packaging equipment.
The protestant states that the film is manufactured by packaging
eqipment which cuts, folds, and seals the plastic sheets into
plastic containers. The protestant contends that magnetic ink
marks or "eyespots" on the sheets can trigger the cutting
mechanism on the packaging equipment. According to the
protestant, the MJB packages do not require the eyespots and the
film in its imported condition is not printed with an eyespot.
Thus, the protestant maintains that the plastic film sheets are
essentially plastic containers in their unassembled or unfinished
state and should be classified in the provision for containers,
of rubber or plastics, with or without their closures, chiefly
used for the packing, transporting, or marketing of the
merchandise in item 772.20, TSUS.
ISSUE:
Whether the merchandise is properly classified as
containers of plastics, with or without their closures, chiefly
used for the packing, transporting, or marketing or merchandise
in item 772.20, TSUS, or rather as other articles not speciallly
provided for, of rubber or plastics in item 774.55, TSUS.
LAW AND ANALYSIS:
In Sanwa Foods, Inc., v. United States, 9 CIT 167 (1985),
the Court of International Trade set forth certain criteria which
must be met in evaluating a classification claim under TSUS item
772.20. In this case, the subject merchandise consisted of rolls
of unassembled plastic packaging for various noodle mixes
produced by the plaintiff. Printed on each roll at regular
intervals were the trademarked product brand name, product
descriptions, preparations instructions, and magnetic black ink
marks. The ink marks were read by an electric eye, which
triggered a mechanism that cut, folded, and sealed the plastic
around various noodle mixes in accordance with the location of
the marks. Since the merchandise in its imported condition was
incapable of "containing" anything, the Court was faced with the
question of whether the merchandise qualified as an unassembled
or unfinished "article" for the purposes of item 772.20, TSUS.
General Interpretative Rule 10(h), TSUS states:
(h) unless the context requires otherwise, a tariff
description for an article covers such article, whether
assembled or not assembled, and whether finished or not
finished (Emphasis added.)
The Court determined that the merchandise met the definition
of an unfinished "article" since first, the merchandise was not
commercially capable of any use other than packaging and second,
the merchandise was marked at regular intervals for the purposes
of cutting, folding, and sealing the plastic around various
noodle mixes. The court stated that the magnetic black ink marks
on the plastic at regular intervals was indicative, if not
solely determinative of classification as an "article" in prior
cases. See e.g. United States v. The Harding Co., 21 CCPA 307,
T.D. 46830 (1933); The Harding Co., et al. v. United States, 23
CCPA 250, T.D. 48109 (1936).
Next, the court considered whether the merchandise met the
criteria for "containers" for the purposes of TSUS item 722.20.
The court determined that the plastic packages fit the definition
of a "container" since the merchandise was "chiefly used for the
packaging, transporting, or marketing of merchandise."
Consequently, the court stated that since an article which
packages various products for shipment before the point of sale,
protects them during transportation, and serves a marketing
function at the retail stage is properly classified under TSUS
item 772.20.
In the instant case, however, it is clear that the sample
merchandise does not meet the first requirement for purposes of
classification in TSUS item 772.20. Although the merchandise is
not commercially capable of use for anything other than
packaging, it is not sufficiently advanced toward completion of
the finished product to justify its categorization as an
"article" for the purposes of item 722.20, since it is not
marked with magnetic black ink marks on the plastic. Thus, the
merchandise fails to meet the criteria for an "article" as
discussed above and is precluded from classification under item
772.20, TSUS. Consequently, it is Customs determination that the
merchandise is more properly classified under TSUS item 774.55.
HOLDING:
Based on the foregoing analysis, it is our determination
that the sample film sheets do not constitue containers of
plastic under item 772.20, TSUS, and that the merchandise is more
properly classified as articles not specifically provided for, of
rubber or plastics: Other: Other under item 774.55, TSUS.
Articles classified under item 774.55, TSUS, are subject to a
rate of duty of 5.7 percent ad valorem.
The protest should be denied. A copy of this decision
should be attached to the Form 19 Notice of Action to be sent to
the protestant.
Sincerely,
John Durant, Director
Commercial Rulings Division