BCB International, Inc.
1010 Niagara Street
Buffalo, NY 14213-1501
RE: The tariff classification of OctoTerra panels from China
Dear Ms. Carman:
In your letter, received February 11, 2013, you requested a tariff classification ruling on behalf of your client, Octopus Products, Ltd. The ruling was returned to you for additional information, which was resubmitted to this office on May 30, 2013. Product information and samples were submitted for our review, and will be retained for reference.
The ruling was requested on five OctoTerra panels of various constructions. Each of the five panels is constructed of a decorative layer laminated onto a plywood base. The plywood base varies in the number of layers, and is stated to be constructed of Manchurian Ash (Fraxinus spp.). Sample OTP24 is faced with curved pieces of coconut palm wood each measuring approximately 3mm thick and 1.5” in length. The pieces are generally arranged in “stacked” rows. Sample OTP22 is also faced with similar pieces of coconut palm wood arranged end to end in lines. The spaces between the wood pieces have been filled in with resin to create an even surface. Sample OTP25 is faced with 2.5mm-thick arranged slices of pear tree branches of varying diameters. Sample OTP26 is similarly faced with slices of pear tree branches, and the spaces between the branches have been filled with resin to create an even surface. Each of the panel faces is coated with a clear lacquer. Although a sample was not submitted, you indicate a fifth construction that has rectangular, convex coconut shell pieces applied to the plywood substrate. You state that the panels measure 48” square upon importation, and are not shaped on the edges or ends. The OctoTerra products are used as decorative panels for covering ceilings, walls, floors, furniture, displays, and retail fixtures.
The classification of merchandise under the Harmonized Tariff Schedule of the United States (HTSUS) is governed by the General Rules of Interpretation ("GRIs"), taken in order. GRI 1 requires that classification be determined according to the terms of the headings and any relative section or chapter notes. In the event that goods cannot be classified solely on the basis of GRI 1, and if the heading and legal notes do not otherwise require the remaining GRI will be applied, in the order of their appearance. For the instant items, neither GRI 1 nor GRI 2 is applicable.
The OctoTerra panels are constructed of materials that are prima facie classifiable in different headings, i.e., plywood and branch slices, coconut shells, or palm wood pieces that have been cut to shape. The panels are therefore composite goods within the meaning of General Rule of Interpretation (GRI) 3(b). GRI 3(b) states, in pertinent part:
(b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.
In accordance with the Explanatory Notes (ENs) for GRI 3(b), the essential character of an item may be determined by the nature of the material or component, its bulk, quantity, weight, or value, or by the role of a constituent material in relation to the use of the goods. While the plywood substrate makes up the majority of the bulk of each panel and facilitates installation, it is the decorative layer that provides the panels with their consumer appeal and is the chief marketable aspect of each product. Therefore, it is the decorative layer that imparts the essential character of each panel. In spite of their use as wall coverings, the panels lack any shaping, such as tongue and groove, which dedicates them solely for use in the construction of a building; for this reason, classification in heading 4418 is precluded.
The applicable subheading for the panels with decorative surfaces employing palm wood or pear tree branch slices will be 4421.90.9780, HTSUS, which provides for Other articles of wood: Other: Other: Other: Other. The rate of duty will be 3.3 percent ad valorem.
The applicable subheading for the panel with the decorative surface employing coconut shells will be 9602.00.5080, HTSUS, which provides for Worked vegetable or mineral carving material and articles of these materials; molded or carved articles of wax, of stearin, of natural gums or natural resins, of modeling pastes, and other molded or carved articles, not elsewhere specified or included: Other: Other. The rate of duty will be 2.7 percent ad valorem.
The applicable subheading for the swatches will be 9811.00.60, which provides for Any sample (except samples covered by heading 9811.00.20 or 9811.00.40), valued not over $1 each, or marked, torn, perforated or otherwise treated so that it is unsuitable for sale or for use otherwise than as a sample, to be used in the United States only for soliciting orders for products of foreign countries. 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/.
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 Laurel Duvall at (646) 733-3035.
Thomas J. Russo
National Commodity Specialist Division