CLA-2 CO:R:C:G 086895 NLP
Mr. David Coutts
BodyPro Inc.
Box 475
2384 Yonge Street
Toronto, Ontario
M4P 2G9
RE: Modification of HRL 084935; Pocket Gym
Dear Mr. Coutts:
On August 23, 1990, this office issued Headquarter's Ruling
Letter (HQ) 084935, which dealt with the tariff classification
of the "Pocket Gym" and the applicable marking requirements. In
a letter dated April 6, 1990 you requested a reconsideration of
our holding, where we determined that a nylon bag contained in
the Pocket Gym was subject to a textile visa. For the reasons
stated below, we are modifying our prior ruling. In addition,
you requested reconsideration of the marking requirements for the
"Pocket Gym". We have forwarded that request to the Value,
Special Programs & Admissibility Branch at Headquarters and a
reply regarding this matter will be sent to you under separate
cover.
FACTS:
The facts as set out in HQ 084935 which list the various
components of the Pocket Gym are incorporated herein. In that
ruling we concluded that the Pocket Gym formed a set, the
essential character of which was imparted by the exercise
equipment. We classified the set under subheading 9506.91.0030,
HTSUSA, which provides for articles and equipment for gymnastics,
athletics, other sports (including table-tennis) or outdoor
games, not specified or included elsewhere in this chapter,
other, gymnasium or other exercise articles and equipment, parts
and accessories thereof, other. Furthermore, we held that the
set was eligible for treatment as goods originating in the
territory of Canada because a substantial transformation had
occured in accordance with General Note 3(c)(vii)(R)(20).
Further, we held that the nylon bag was subject to a textile visa
and quota requirements.
ISSUE:
What is the tariff classification of the Pocket Gym?
LAW AND ANALYSIS:
The General Rules of Interpretation (GRI's) to the HTSUSA
govern the classification of goods in the tariff schedule. GRI 1
requires that classification be determined first according to the
terms of the headings of the tariff schedule and any relative
section or chapter notes, and, unless otherwise required,
according to the remaining GRI's, taken in order.
In the instant case, the Pocket Gym is composed of
unassembled parts that when assembled form a single piece of
exercise equipment that can be used in many ways. The article is
also incomplete to the extent that it is imported without the
latex tubing and "O" rings. GRI 2(a) states the following:
(a) any reference in a heading to an article shall be
taken to include reference to that article incomplete
or unfinished, provided that, as entered, the
incomplete or unfinished article has the essential
character of the complete or finished article. It
shall also include a reference to that article complete
or finished (or failing to be classified as complete or
unfinished by virtue of this rule), entered unassembled
or disassembled.
We are of the opinion that at the time of importation the Pocket
Gym is readily identifiable as exercise equipment, even though
the latex tubing has not yet been added. Therefore, the Pocket
Gym imported in several pieces is to be classified in the same
heading as the complete and assembled article. The applicable
tariff provision is Heading 9506, HTSUSA, which provides for
articles and equipment for gymnastics, athletics, other sports
(including table-tennis) or outdoor games, not specified or
included elsewhere in this chapter.
GRI 3 governs the classification of goods which are prima
facie classifiable within two or more headings. The exercise
equipment is classifiable within subheading 9506.91.00, HTSUSA,
which provides for articles and equipment for gymnastics,
athletics, other sports (including table-tennis) or outdoor
games, not specified or included elsewhere in this chapter,
other, gymnasium or other exercise articles and equipment, parts
and accessories thereof. The carrying case is classifiable in
subheading 4202.92.90, HTSUSA, which provides for trunks,
suitcases and similar containers with outer surface of textile
materials. However, neither one of these headings by itself
covers the combined merchandise. Therefore, the merchandise as a
whole is prima facie classifiable under two headings.
GRI 3(a) requires the heading which provides the most
specific description of the article to govern over one which
provides a more general description. However, when two or more
headings each refer to part only of the components contained in
composite goods those headings are to be regarded as equally
specific in relation to those goods. This is the situation which
exists in the instant case. Goods which cannot be classified
according to this rule are then classified according to GRI 3(b).
GRI 3(b) provides for composite goods made up of different
components. According to Explanatory Note IX to GRI 3(b):
...composite goods made up of different components
shall be taken to mean not only those in which the
components are attached to each to each other to form a
practically inseparable whole but also those with
separable components provided these components are
adapted one to the other and are mutually complementary
and that together they form a whole which would not
normally be offered for sale in separate parts.
The components at issue satisfy this description. They are
separable into the exercise equipment and the carrying bag. They
are also adapted for use together. For example, the bag
operates as both a storage place and carrying bag for the
exercise equipment. In addition, these components are mutually
complementary based on the fact that they are intended to be used
together as a whole. Lastly, they are not normally offered for
sale separately.
Composite goods are classifiable as if they consisted of the
component which gives them their essential character.
Explanatory Note VIII to GRI 3(b) states that:
The factor which determines essential character will
vary as between different kinds of goods. It may, for
example, 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
goods.
The component which establishes essential character in this case
is the exercise equipment based on the fact that it is the
prinicipal component of the merchandise. As previously
discussed the exercise equipment is classifiable in subheading
9506.91.00, HTSUSA. Accordingly, the composite good would be
classifiable as if it consisted solely of the exercise
equipment.
HOLDING:
The exercise equipment and the carrying bag are a composite
good classifiable according to their essential character within
subheading 9506.91.0030, HTSUSA, which provides for articles and
equipment for gymnastics, athletics, other sports (including
table-tennis) or outdoor games, not specified or included
elsewhere in this chapter, other, gymnasium or other exercise
articles and equipment, parts and accessories thereof. The rate
of duty is 4 percent ad valorem. As a product of Canada, the
exercise articles are eligible for a reduced rate of duty of 3.7
percent ad valorem.
HRL 084935 is modified pursuant to 19 CFR 177.9(d).
Sincerely,
John Durant, Director
Commercial Rulings Division