CLA-2 OT:RR:CTF:EMAIN H288842 NVF
Long Vu
Classification Manager – Customs Compliance
Walgreen Co.
204 Wilmot Road
MS #3163
Deerfield, IL 60015
RE: Tariff classification of LED Candle Fountain from China
Dear Mr. Vu:
This is in response to your letter of June 20, 2017, submitted on behalf of Walgreen Co. requesting a prospective ruling as to the classification of an LED candle fountain (hereinafter “fountain”) under the Harmonized Tariff Schedule of the United States (“HTSUS”). In reaching the below determination, we have considered information presented in your June 20, 2017 letter, and public information. Additionally, to confirm narrative descriptions of the subject merchandise, we have inspected the product sample provided with the ruling request.
FACTS:
The subject fountain is a battery operated tabletop fountain primarily made of plastic. It consists of a rectangular fountain that contains a submersible pump and three LED lights housed in plastic casings that look like candles. The fountain also has some stones that are meant to be placed at the base of the “candles.” When water is added and the fountain is activated, the LED lights turn on and the submersible pump circulates the water up through the three “candles” which in turn produces the sound of flowing water.
In your ruling request, you state that the fountain is a composite good and ask whether the plastic components of the fountain or the submersible pump imparts its essential character. You suggest that the plastic components impart the essential character. As support for this position, you state that when the pump is turned on, the flow of the water is slow and quiet and does not provide a great deal of visual or auditory appeal; the LED lights have “very minimal effects.” Additionally, you observe that the fountain can be used as a decorative object without turning the pump on.
ISSUE:
Whether the essential character of the fountain is imparted by its plastic components or the submersible pump, and thus whether the fountain is classified as other articles of plastic under heading 3926, HTSUS, or a pump for liquid under heading 8413, HTSUS.
LAW AND ANALYSIS:
GRI 1 requires that classification be determined first according to the terms of the 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. Goods that are prima facie classifiable under two or more headings are classifiable in accordance with GRI 3.
GRI 3(a) states that the heading that provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings refer to only part of the items in a composite good or set, those headings are to be regarded as equally specific in relation to the goods, even if one of the gives a more complete or precise description of the good. As such, they are regarded as equally specific and classification of the composite good or set is to be determined by GRI 3(b) or GRI 3(c).
GRI 3(b) states that composite goods or sets which cannot be classified by reference to GRI 3(a) are to be classified as if they consisted of the component that gives them their essential character.
The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the Harmonized System at the international level. While neither 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. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The HTSUS headings under consideration are as follows:
3926 Other articles of plastics and articles of other materials of headings 3901 to 3914.
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8413 Pumps for liquids, whether or not fitted with a measuring device; liquid elevators; parts thereof.
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In this case, because the fountain consists of a plastic decorative casing and a pump, the fountain is a composite good that must be classified as if it consisted of the component which imparts its essential character. It is well-established that a determination as to “essential character” is driven by the particular facts of the case at hand. See, e.g., Alcan Food Packaging (Shelbyville) v. United States, 771 F.3d 1364, 1366 (Fed. Cir. 2014) (“The ‘essential character’ of merchandise is a fact-intensive issue.”); see also EN VIII to GRI 3(b) (“The factor which determines essential character will vary as between different kinds of goods.”). That said, essential character has traditionally been understood as “that which is indispensable to the structure, core or condition of the article, i.e., what it is” and as “the most outstanding and distinctive characteristic of the article.” Structural Indus. v. United States, 360 F. Supp. 2d 1330, 1336 (Ct. Int’l Trade 2005).
The Court of International Trade has specifically addressed the classification of tabletop fountains. In Conair Corp. v. United States, the court held that the essential character of tabletop fountain which consisted of a plastic housing, water pump, and decorative rocks was imparted by the pump. Conair Corp. v. United States, 29 C.I.T. 888 (2005). The court found that consumers would not buy a tabletop fountain “for the purpose of enjoying the visual aspects of the plastic sculpture.” Id. at 897. Rather, it reasoned that any visual or auditory appeal was present only when the pump was running and water was flowing through the fountain and therefore the pump was the indispensable item that imparted the essential character. Id. The court thus classified the fountain under heading 8413, HTSUS, which provides for pumps for liquids. After Conair was decided, CBP established a practice of classifying most tabletop fountains under heading 8413, HTSUS. HQ W968092 (Apr. 20, 2006); NY N301326 (Nov. 16, 2018); NY N302101 (Feb. 6, 2019); NY N303133 (Mar. 20, 2019).
Regarding the instant tabletop fountain, we find that it does not materially differ from the fountain at issue in Conair or the aforementioned rulings. While the fountain has three LED lights, they are not very bright and thus do not contribute significantly to the ambiance otherwise provided by the sound of moving water. Additionally, the lights do not operate unless the pump itself is switched on. You assert that the plastic elements of the tabletop fountain are sufficiently decorative to impart the essential character of the fountain. We disagree. While there could be some decorative aspects to the plastic parts of the fountain, as with the plastic fountain in Conair, consumers would not purchase this fountain solely for the visual aspect of the plastic candles. Likewise, the plastic components also serve as the housing for the pump and the channels through which the water flow up before trickling down. This enables the subject merchandise to function as a tabletop fountain. Therefore, we find that the essential character of the instant tabletop fountain is imparted by the pump.
HOLDING:
By operation of GRIs 3(b) and 6, the candle fountain is classified in subheading 8413.70.20, HTSUS. The column one, general rate of duty for merchandise of subheading 8413.70.20, HTSUS is Free.
Effective July 6, 2018, the Office of the United States Trade Representative (USTR) imposed an additional tariff on certain products of China classified in the subheadings enumerated in Section XXII, Chapter 99, Subchapter III U.S. Note 20(b), HTSUS. The USTR imposed additional tariffs, effective August 23, 2018, on products classified under the subheadings enumerated in Section XXII, Chapter 99, Subchapter III U.S. Note 20(d), HTSUS. Subsequently, the USTR imposed further tariffs, effective September 24, 2018, on products classified under the subheadings enumerated in Section XXII, Chapter 99, Subchapter III U.S. Note 20(f) and U.S. Note 20(g), HTSUS. For additional information, please see the relevant Federal Register notices dated June 20, 2018 (83 Fed. Reg. 28710), August 16, 2018 (83 Fed. Reg. 40823), and September 21, 2018 (83 Fed. Reg. 47974). Products of China that are provided for in subheading 9903.88.01, 9903.88.02, 9903.88.03, or 9903.88.04 and classified in one of the subheadings enumerated in U.S. Note 20(b), U.S. Note 20(d), U.S. Note 20(f) or U.S. Note 20(g) to subchapter III shall continue to be subject to antidumping, countervailing, or other duties, fees and charges that apply to such products, as well as to those imposed by the aforementioned Chapter 99 subheadings.
Products of China classified under subheading 8413.70.20, HTSUS, unless specifically excluded, are subject to the additional 25 percent ad valorem rate of duty. At the time of importation, you must report the Chapter 99 subheading, i.e., 9903.88.01, in addition to subheading 8413.70.20, HTSUS, listed above.
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 internet at www.usitc.gov/tata/hts/.
A copy of this ruling letter should be attached to the entry documents filed at the time the goods are entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the CBP officer handling the transaction.
Sincerely,
Gregory Connor, Chief
Electronics, Machinery, Automotive, and
International Nomenclature Branch.