CLA-2-94:OT:RR:NC:N4:433
David Prata
Trade Compliance Analyst
OHL International
Mail Code 1049
1 CVS Drive
Woonsocket, RI 02895
RE: The tariff classification of a display rack from China.
Dear Mr. Prata:
In your letter dated November 16, 2015, on behalf of CVS/pharmacy, you requested a tariff classification ruling. A photo was submitted.
CVS item number 898114 is a floor standing, red, white and blue paperboard display rack that will be pre-loaded with assorted patriotic accessories. The display rack measures 14.5-inches wide by 17-inches deep by 54-inches high. The central portion of the display unit will be loaded with merchandise. The base, top, and sides of the display unit will be folded flat and require assembly at the store. When the content merchandise has been sold, the display rack will be discarded. It will not be refilled at the store.
It is stated by you that, “this ruling request concerns only the paperboard display, not the contents.” You question, whether the loaded paperboard display rack constitutes General Rules of Interpretation, GRI 5 (b) packing materials classifiable with its goods, or must the display rack be classified separately from that of its goods. You further question, if the display rack is separately classifiable is it properly classified in Chapter 48 (…; Articles of Paper Pulp, of Paper or Paperboard) or in Chapter 94 (Furniture ….). We will first address the classification of the paperboard display rack if imported by itself and without the pre-loaded assorted patriotic accessories.
When interpreting and implementing the HTSUS, the ENs of the Harmonized Commodity Description and Coding System may be utilized. The ENs, while neither legally binding nor dispositive, provide a guiding commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. CBP believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The General ENs to Chapter 94 of the HTSUS, state, in relevant part, with regard to the meaning of furniture, at (A): For the purposes of this Chapter, the term “furniture” means: Any “movable” articles (not included under other more specific headings of the Nomenclature), which have the essential characteristic that they are constructed for placing on the floor or ground, and which are used, mainly with a utilitarian purpose, to equip private dwellings, hotels, theatres, cinemas, offices, churches, schools, cafés, restaurants, laboratories, hospitals, dentists, surgeries, etc., or ships, aircraft, railway coaches, motor vehicles, caravan-trailers or similar means of transport. (It should be noted that, for purposes of this Chapter, articles are considered to be “movable” furniture even if they are designed for bolting, etc., to the floor, e.g., chairs for use on ships). Similar articles (seats, chairs, etc.) for use in gardens, squares, promenades, etc., are included in this category.
From a reading of the aforementioned paragraph, the fact that the floor standing, red, white and blue paperboard display rack will not be refilled at the store, and therefore has a limited lifespan, does not appear to bar the rack from being classified as an article of furniture. This office has classified furniture composed of paperboard and other materials in heading 9403, HTSUS – see New York rulings: N093242 dated February 18, 2010 and N120375 dated September 16, 2010.
The paperboard display rack is movable, floor standing, and has the utilitarian function to hold the goods placed within in it for point of sale purchases. Accordingly, we find no legal notes to the HTSUS for Chapter 94 that would exclude the good from its provisions, specifically that of “Furniture,” nor do we find any legal notes placing the good in Chapter 48 that of “Articles of Paperboard.” As such, the good is not more specifically provided for elsewhere in the tariff schedule, and when imported by itself and without the pre-loaded assorted patriotic merchandise, is classifiable within the furniture provisions of Chapter 94 with its heading of 9403, HTSUS.
The applicable subheading for the floor standing, red, white and blue paperboard display rack, imported by itself and without the pre-loaded assorted patriotic merchandise, will be 9403.89.6020, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Furniture and parts thereof: Furniture of other materials, including cane, osier, bamboo or similar materials: Other: Other: Other.” The rate of duty will be free.
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 World Wide Web at http://www.usitc.gov/tata/hts/.
In HQ 965995 (I83622-Affirmed) dated December 26, 2002, “Gel-A-Mint MagikStrips,” packed in a plastic dispenser case and mounted on a blister card, were classified only based on the breath freshening strips. Likewise, in New York ruling, NY M84645 dated July 14, 2006, “Under the Sun Body Butters,” packed in a zebra stripe display box filled with 24 assorted containers, was classified only based on the body butters. Both of these rulings employed GRI 5 (b), resulting in the packing dispenser and the box being classified with the goods to which they belong. Unlike these two rulings above, where the goods were basically a single product contained within their usual/normal packing dispenser or box, the merchandise concerned is an assortment of products (patriotic accessories), and must be reviewed in the context of a set, in accordance with GRI 3 (b) to the HTSUS, before a GRI 5 (b) determination can be made on its display rack.
The ENs state at Note X to Rule 3 (b) that the term “goods put up in sets for retail sale” means goods which: consist of at least two different articles which are, prima facie, classifiable in different headings; (b) consist of products or articles put up together to meet a particular need and carry out a specific activity; and (c) are put up in a manner suitable for sale directly to users without repacking. In this case, based on observation of the photo, the assortment of patriotic accessories does not meet the conditions of being classified as a set for tariff purposes, in that the goods, although sharing a patriotic theme, are not put up in a manner to meet a particular need or carry out a specific activity, and more over are not packaged together in a manner suitable for sale directly to users without repacking. Consequently, each item within the floor standing, red, white and blue paperboard display rack, pre-loaded with assorted patriotic accessories, has to be separately classified, including the paperboard display rack.
Additionally, employing GRI 5 (b), this office does not find the floor standing, red, white and blue paperboard display rack to be the normal packing container for the patriotic accessories, resulting in the paperboard display rack being separately classified from that of its patriotic accessories.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Neil H. Levy at [email protected].
Sincerely,
Gwenn Klein Kirschner
Director
National Commodity Specialist Division