CLA-2-49:OT:RR:NC:4:434
Carisa Schoemaker
Crayola LLC
1100 Church Lane
PO Box 431
Easton, PA 18044
RE: Classification of Coloring Sets from Canada
Dear Ms. Schoemaker:
In your letter, dated May 15, 2018, you requested a classification ruling on two styles of coloring kits, including whether the U.S.-made components of the sets qualify for treatment under special subheading 9802.00.80, Harmonized Tariff Schedule of the United States (HTSUS). Descriptive literature and samples were submitted for our review. The samples will be returned. Your request for confidential treatment of certain provided product specifications has been granted.
Kit # 1 (Vanishing Numbers) includes 12 colored markers and 18 paper coloring sheets packaged for retail sale inside a paperboard carrying case. The coloring sheets are pre-printed with design templates and color-by-number guides that instruct the child which color to use on each numbered area of the design. Special ink on the page reacts with special ink in the markers to make the numbers on the page disappear when colored.
Kit # 2 (Pop Art) includes 12 colored markers and 18 paper coloring sheets packaged for retail sale inside a paperboard carrying case. The coloring sheets are pre-printed with design templates and coated with a substance that reacts with the marker ink to produce especially vibrant colors.
The Explanatory Notes (ENs) to the Harmonized Tariff Schedule of the United States (HTSUS) constitute the official interpretation of the tariff at the international level. EN X to General Rule of Interpretation (GRI) 3(b) provides: “for the purposes of this Rule, the term "goods put up in sets for retail sale" shall be taken to mean goods which: (a) consist of at least two different articles which are, prima facie, classifiable in different headings; (b) consist of products or articles put together to meet a particular need or carry out a specific activity; and (c) are put up in a manner suitable for sale directly to users without repacking (e.g., in boxes or cases or on boards).” Sets are classified according to the component, or components taken together, which can be regarded as conferring on the set as a whole its essential character.
The coloring kits consist of multiple articles classifiable under separate headings. The components of the kits carry out a specific activity. They are packaged for retail sale. Therefore, these coloring kits meet the definition of the term “goods put up in sets for retail sale”. We find that the pre-printed paper coloring sheets confer the essential character of each set.
The applicable subheading for the coloring sets will be 4911.91.4040, HTSUS, which provides for Pictures, designs and photographs: Printed not over 20 years at time of importation: Other: Other: Other. The rate of duty will be free.
You further inquire whether the markers and printed paper coloring sheets, which you state are manufactured in the United States, are eligible for consideration under subheading 9802.00.80, HTSUS, when imported from Canada packaged as sets inside the paperboard carrying case, which is a product of Vietnam.
Subheading 9802.00.80, HTSUS, provides for, “Articles, except goods of heading 9802.00.90 and goods imported under provisions of subchapter XIX of this chapter and goods imported under provisions of subchapter XX, assembled abroad in whole or in part of fabricated components, the product of the United States, which (a) were exported in condition ready for assembly without further fabrication, (b) have not lost their physical identity in such articles by change in form, shape or otherwise, and (c) have not been advanced in condition abroad except by being assembled and except by processes incidental to the assembly process such as cleaning, lubricating and painting.”
"Assembly" operations for purposes of HTSUS subheading 9802.00.80 mean the fitting or joining together of fabricated components, such that the components are in a fixed relationship to each other. See Headquarters ruling HQ 555773, 12/10/1990. Acceptable assembly operations are interpreted at section 10.16(a), Customs Regulations (19 CFR 10.16(a)). This section provides that, “the assembly operation performed abroad may consist of any method used to join or fit together solid components, such as welding, soldering, riveting, force fitting, gluing, laminating, sewing, or the use of fasteners. Operations incidental to the assembly are not considered further fabrication operations if they are of a minor nature.”
Simple packaging of the articles together is not considered an assembly operation. Accordingly, the scenario presented for sending the U.S.-made markers and paper coloring sheets to Canada for packaging into sets fails to meet the requirements for treatment under subheading 9802.00.80, HTSUS.
However, they could qualify for another Chapter 98 provision. Subheading 9801.00.10, HTSUS, provides for the free entry of products of the U.S. that have been exported and returned without having been advanced in value or improved in condition by any process of manufacture or other means while abroad, provided the documentary requirements of Section 10.1, Customs Regulations (19 CFR 10.1), are met. The mere packaging of the U.S.-made markers and coloring sheets is considered neither an advancement in value nor an improvement in condition for the purposes of subheading 9801.00.10, HTSUS. As a result, the markers and coloring sheets may be eligible for an allowance in duty made under subheading 9801.00.10, as American Goods Returned. See Headquarters ruling HQ 556355, 2/21/1992, regarding classification of a U.S.-made shoe shine cloth packaged in Canada into a complete shoe shine kit with foreign-made components.
You also inquire about the classification of the paperboard carrying case, if imported empty. The Crayola case measures approximately 10 3/8” wide x 8 3/8” high x 2 1/8” deep. The case has a metal handle and two metal latch closures; it is shaped not unlike a small briefcase. It is constructed of paperboard and is overlaid with a printed, plastic-coated paper. The paper forms the hinge between both halves of the case. Inside one side of the case is a plastic tray that is glued into place and fitted to hold 12 colored pens. The tray is embossed with the words “Crayola Art with Edge”; this is also printed on the outside of the case. Because the case is clearly indicated for holding specific art supplies, it is not designed for repetitive use nor for conveyance of general items.
The applicable subheading for the Crayola case, entered alone, will be 4823.90.6700, HTSUS, which provides for Other paper, paperboard, cellulose wadding and webs of cellulose fibers, cut to size or shape; other articles of paper pulp, paper, paperboard, cellulose wadding or webs of cellulose fibers: Other: Other: Other: Of coated paper or paperboard: 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 the World Wide Web at https://hts.usitc.gov/current.
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 Charlene Miller at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division