CLA-2 OT:RR:CTF:TCM W968416 HkP
Mr. Joseph R. Hoffacker
Barthco International, Inc.
The Navy Yard
5101 S. Broad Street
Philadelphia, PA 19112-1404
RE: Reconsideration of NY R03082; plastic storage crates and bins
Dear Mr. Hoffacker:
This is in response to your request for reconsideration of New York Ruling Letter (“NY”) R03082, issued on February 8, 2006, to your client, Ikea Wholesale, Inc. (“Ikea”). In that ruling, U.S. Customs and Border Protection (“CBP”) classified certain storage crates, bins, and lids of plastic under the Harmonized Tariff Schedule of the United States (“HTSUS”) (2006). At issue in this decision is the classification of the storage crates and bins under heading 3926, HTSUS, which provides for, among other thing, other articles of plastics; the classification of the lids under heading 3923, HTSUS, is not in dispute. For the reasons set forth below, we hereby confirm that classification of the plastic storage crates and bins under heading 3926, HTSUS, is correct.
The merchandise at issue is:
Article # 10064850, VESSLA plastic storage crate with castors, 39 x 39 x 28 cm
Article # 20089242, TROFAST plastic storage bin, 42 x 30 x 36 cm
Article # 57454326, TROFAST plastic storage bin, 42 x 30 x 23 cm
Article # 60094072, TROFAST plastic storage bin, 42 x 30 x 10 cm
The storage crates and bins are made from polypropylene plastic and the castors are made from both acetal and polymide plastic.
In its ruling request, Ikea stated that the articles at issue will be marketed and used principally for storage and will be imported and sold in various colors. In your reconsideration request of September 22, 2006, you explain that the crates and bins will be principally used for the storage of household articles and that they are advertised and sold in the children’s section of Ikea. You also explain that Ikea is commonly known as a store that sells household products and that consumers expect to use the plastic products at issue and sold by Ikea in their households. You conclude that since these plastic crates and bins are advertised and sold for household storage by a household goods retailer, the correct classification of these articles is under heading 3924, HTSUS, which provides for, among other things, household articles of plastics.
Whether the plastic storage crates and bins under consideration are “household articles” of plastic, properly classified under heading 3924, HTSUS.
LAW AND ANALYSIS:
Classification of merchandise under the HTSUS is in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied in order.
The HTSUS provisions under consideration are as follows:
3924 Tableware, kitchenware, other household articles and toilet articles, of plastics:
* * *
* * *
3924.90.5500 Other …..
3926 Other articles of plastics and articles of other materials of headings 3901 to 3914:
* * *
* * *
3926.90.98 Other …..
* * *
3926.90.9880 Other …..
You contend that the merchandise at issue is properly classified in heading 3924, HTSUS, which provides for, among other things, household articles of plastic. In construing the breadth of this provision the Court of International Trade (“CIT”) in The Hartz Mountain Corporation v. United States, 19 CIT 1149, 903 F. Supp. 57 (citations omitted) (1995), found that:
When “household” is used in conjunction with the term “articles” in subheading 3924.90.50, HTSUS, a use provision is created. [Citation omitted]. Classification under this kind of use provision is determined by the principal use in the United States, at the time of importation, of the class or kind of goods to which the imported goods belong. Harmonized Tariff Schedule of the United States, Additional U.S. Rule of Interpretation 1(a) … Hence, “other household articles of plastic” describes plastic articles of the class or kind principally used in the American household at the time that the subject merchandise was imported.
Additional U.S. Rule of Interpretation 1(a) provides that, in the absence of special language or context which otherwise requires, “a tariff classification controlled by use (other than actual use) is to be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong, and the controlling use is the principal use.” Generally, the courts have provided several factors, which are indicative but not conclusive, to apply when determining whether merchandise falls within a particular class or kind. They include: (1) general physical characteristics, (2) expectation of the ultimate purchaser, (3) channels of trade, environment of sale (accompanying accessories, manner of advertisement and display), (4) use in the same manner as merchandise which defines the class, (5) economic practicality of so using the import, and (6) recognition in the trade of this use. See Lennox Collections v. United States, 20 CIT 194, 196 (1996). See also United States v. Carborundum Co., 63 CCPA 98, 102, 536 F.2d 373, 377 (1976), cert denied, 429 U.S. 979 (1976); Kraft, Inc. v. United States, 16 CIT 483, 489 (1992); and G. Heileman Brewing Co. v. United States, 14 CIT 614, 620 (1990).
Accordingly, we must first determine the principal use of the entire class of storage crates and bins to which the Ikea merchandise belongs. If the class or kind of storage containers is principally used as household articles, then Ikea’s merchandise is classifiable in heading 3924, HTSUS. However, if these kinds of storage containers are not principally used in a household then Ikea’s merchandise cannot be classified in heading 3924, even if these particular crates and bins are bought in a home goods store and purchasers expect to use them and actually use them for household storage.
In general, CBP has found that plastic storage bins and crates for household use have decorative features such as tapered sides, buckles, loops, handles with contrasting reinforcement, textile linings, or faux leather coverings. In addition, we note that although sturdily constructed, household storage items are usually, though not always, constructed of plastic sheeting or of paperboard covered with plastic sheeting. See, for example, NY L84098, dated April 19, 2005, in which CBP classified an open top bin in subheading 3924.90.5500, HTSUS. The bin was constructed of plastic sheeting with a metal reinforcing band around the top and around the two cut-out handles. It measured 10 inches in height, and approximately 11 inches by 12 ¾ inches at the base, tapering outwards to approximately 13 inches by 14 ½ inches at the top. In NY R02025, dated June 9, 2005, four plastic bins were classified in subheading 3924.90.5500, HTSUS. All were shaped to taper outward at the top. One bin measured 22.75 inches by 13 inches by 11.5 inches and had a cut-out handle at each end. A second bin measured 18 inches by 7.5 inches by 12 inches and had sloping sides and a buckle across the middle. The third style measured 24 inches by 13 inches by 15.75 inches and had a strap at each end that looped over and buckled to form a handle. The fourth style measured 13.75 inches by 13.5 inches by 11 inches and had double strap handles. All of the storage bins were constructed of polyvinyl chloride (PVC) covered with fabric backed polyurethane sheeting. In NY L88337, dated November 9, 2005, CBP classified a storage bin used to hold magazines and newspapers in subheading 3924.90.5500, HTSUS. The bin measured approximately 14 inches in length, 9 ½ inches in width, and tapered in height from 8 inches at the center to 9 ¾ inches at each end. It was constructed of paperboard covered on the exterior with cellular plastic sheeting designed to simulate leather. The interior was lined with textile fabric.
General Physical Characteristics; Channels of Trade/Environment of Sale
A visual inspection of the sample Ikea containers and similar merchandise on the Internet reveals that they are not physically similar to the class or kind of plastic storage articles that CBP has found to be principally used in the home (described above).
With regard to channels of trade and environment of sale, we note that the bins at issue and similar items are marketed and sold for both household and non-household uses. CBP has conducted research on the Internet and has found several websites that market and sell plastic storage containers similar to the articles at issue. For example, United States Plastic Corp. (www.usplastic.com) describes the containers it sells as “general purpose containers … to meet almost every need.” The containers are marketed for use as small parts boxes, craft supply boxes and tool boxes. Staples (www.staples.com) sells a 12-bin supplies organizer for “office, school, home and craft supplies”. Based on the fact that the kinds of bins which are similar to the ones at issue are sold as general purpose items, we find that the principal use of this class of merchandise is for general and not household purposes.
Use, Recognition of Use & Purchasers’ Expectations
CBP believes it is reasonable to conclude that the capabilities and uses of merchandise with the same physical characteristics as the crates and bins at issue, as portrayed by the industry, shapes consumers expectations. These kinds of bins and crates are portrayed as being for general purposes both inside and outside the home. Consequently, we find that purchasers use and expect to use these types of articles both inside and outside the home.
Based on all of the foregoing factors, CBP finds that the Ikea bins and crates at issue do not belong to the class or kind of plastic storage articles principally used in the household. They are not physically similar to other plastic articles found to be for household storage. Further, they are marketed and sold as general purpose containers and purchasers expect to use them as such, both inside and outside the home. Accordingly, they are precluded from classification under heading 3924, HTSUS, by the terms of that heading. The fact that purchasers of these particular articles may buy them in a home goods store and use them for household storage is not persuasive. In addition, we find that the plastic storage bins and crates at issue were properly classified in NY R03082 under heading 3926, HTSUS, in subheading 3926.90.9880, which provides for other articles of plastics, other.
We note that CBP has classified other sturdily constructed general purpose bins and crates as other articles of plastics under heading 3926, HTSUS. In NY R03112, dated February 8, 2006, CBP classified small utility bins suitable for storing or organizing nuts, bolts, nails, screws or other small items in subheading 3926.90.9880, HTSUS. Although these bins were sold for use in the home garage, we found them to be “of a class or kind used in garages, warehouses and workshops.” In NY R04920, dated October 13, 2006, CBP classified folding crates in subheading 3926.90.9880, HTSUS. The crates, which had a capacity of about 12 gallons, were molded of heavy-duty plastic and reinforced with metal pins. They were marketed as being suitable for use in the laundry area or in a car trunk. Other suggested uses included carting groceries or sports equipment. CBP found that these crates were not of a class or kind principally used in the home.
By application of GRI 1, the plastic storage crates and bins under consideration are correctly classified under heading 3926, HTSUS (2007), in subheading 3926.90.9880, which provides for: “Other articles of plastics and articles of other materials of headings 3901 to 3914: Other: Other: Other.” The 2007 column one general rate of duty rate of duty is 5.3% ad valorem.
NY R03082, dated February 8, 2006, is hereby affirmed.
Myles B. Harmon, Director
Commercial and Trade Facilitation Division