CLA-2 CO:R:C:M 088483 DFC
Ms. Alison Leavitt
Chase Leavitt CHB, Inc.
10 Dana Street
Portland ME 04112
RE: Uppers, formed, unassembled
Dear Ms. Leavitt:
Your letter dated November 21, 1990, addressed to our
New York office has been referred to us for a direct reply
to you as to the tariff classification under the Harmonized
Tariff Schedule of the United States Annotated (HTSUSA), of
three "unformed" uppers, two half insoles, a sock lining and
a heel pad produced in Thailand. Samples were submitted for
examination.
FACTS:
The sample labelled "Original" is a leather upper which
partially covers the bottom of the foot but which has not been
shaped by lasting. In addition, it has a hole at the bottom
of approximately 3 inches in length, measured from the back of
the heel. There are metal eyelets along the sides of the throat.
Stapled to the upper is a half insole which is composed of a
leather piece and a foam cushion. The insole runs from the heel
to the mid foot. On the surface of the insole are the words,
"MADE IN U.S.A.."
The sample labelled "BUC" is a leather upper which covers
the top of the foot but which is completely open and unformed
at the bottom. There are eyelets along the sides of the throat.
Stapled to the upper is a half insole which is composed of a
leather piece and a foam cushion. The insole runs from the heel
to the mid foot.
The sample labelled "Chrissie" is a leather upper which
covers the top of the foot but which is completely open and
unformed at the bottom. There are eyelets along the sides of
the throat. Stapled to the upper is a man-made textile sock
lining which will cover the bottom of the foot in the completed
shoe. There is also an elliptic shaped piece of leather of the
same type as the upper, approximately 2 inches long, with the
word "Bass" inside an oval boarder printed in gold. It appears
that this additional piece of leather is a heel pad.
You inform us that the uppers will be imported separately
from the attached insoles or sock lining and heel pad at times,
and at other times the uppers will be imported with the insoles
or sock lining and heel pad. In New York Ruling Letter 858480
dated December 28, 1990, you were advised as to the
classification and marking requirements for the described samples
when they are imported separately except for the sample insole
labelled "ORIGINAL," which is marked "Made in the U.S.A.."
This ruling will only address the classification issues
involved. The country of origin marking question will be the
subject of a separate ruling which will be issued to you in the
near future.
ISSUE:
Do the uppers imported with insoles or sock lining and heel
pad constitute unassembled/unfinished "formed uppers" for tariff
purposes?
Should the unformed uppers and the insoles, sock lining and
heel pad be classified separately although imported together?
LAW AND ANALYSIS:
In applying the HTSUSA, the Customs Service must follow the
terms of the statute. Classification of goods under the HTSUSA
is governed by the General Rules of Interpretation (GRI's). GRI
1 provides that "classification shall be determined according to
the terms of the headings and any relative section or chapter
notes, and, provided such headings or notes do not otherwise
require, according to [the remaining GRI's taken in order]." In
other words, classification is governed first by the terms of the
headings of the tariff and any relative section or chapter
notes.
-3-
ISSUE NO 1
GRI 2(a), HTSUSA, which is relevant here reads as follows:
2. (a) Any reference in a heading to an article shall
be taken to include a 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 falling to be classified as complete or
finished by virtue of this rule), entered
unassembled or disassembled.
The components are clearly intended to be assembled
together, and, with the addition of other pieces, most
importantly an outersole, will be sold to consumers as finished
footwear.
It should be noted that Customs has taken the position that
an insole/sock lining and an upper which were imported together
are considered to be constructively assembled pursuant to GRI 2
(a), supra, for purposes of creating a "formed upper" under the
HTSUSA. However, it should also be noted that in order to be
considered a "formed upper" that upper must be both front part
and back part lasted. See Headquarters Ruling Letter 088035
dated February 1, 1991. Not one of the three uppers involved is
both front part and back part lasted. Consequently, even when
the uppers (in their present condition) are imported together
with their respective half insoles, or sock lining and heel pad,
they will not constitute "formed uppers."
ISSUE NO. 2
GRI 2(b), HTSUSA, reads as follows:
(b) Any reference in a heading to a material or
substance shall be taken to include a reference
to mixtures or combinations of that material or
substance with other materials or substances.
Any reference to goods of a given material or
substance shall be taken to include a reference
to goods consisting wholly or partly of such
material or substance. The classification of
goods consisting of more than one material or
substance shall be according to the principles of
rule 3.
-4-
GRI 3, HTSUSA, provides in pertinent part as follows:
3. When by application of rule 2(b) or for any other
reason, goods are prima facie classifiable under
two or more headings, classification shall be
effected as follows:
(a) The heading which provides the most specific
description shall be preferred to headings
providing a more general description.
However, when two or more headings each refer
to part only of the materials or substances
contained in mixed or composite goods or to
part only of the items in a set put up for
retail sale, those headings are to be
regarded as equally specific in relation to
those goods, even if one of them gives a more
complete or precise description of the goods.
(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 give them their
essential character, insofar as this criterion
is applicable.
GRI 3(b), HTSUSA, is relevant here because GRI 3(a), HTSUSA,
cannot be used in determining classification. The Explanatory
Notes (EN) for GRI 3, HTSUSA, which are the official
interpretation of the Harmonized System at the international
level state that the term "goods put up in sets for retail sale"
means goods that:
(a) consist of at least two different articles prima facie
classifiable in different headings (or, by GRI 6
subheadings);
(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).
-5-
The components do not qualify as "goods put up in sets for
retail sale" because the stated use of the articles is not to
offer them for retail sale. Thus, the further question to be
resolved is whether the components when imported together create
a composite good.
EN IX to GRI 3(b), HTSUSA, reads in pertinent part as
follows:
(IX) For the purposes of this Rule, composite goods made
up of different components shall be taken to mean
not only those in which the components are attached
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.
In this instance, none of the parts stapled to their
respective uppers will form a whole when combined with those
uppers. We know of no way to refer to them than as, for
example, an upper plus a matching half sole. Such a
description does not sound like the name of a single "whole" to
us.
In view of the foregoing it is our opinion that these
components when imported together will not be "composite goods"
within the purview of GRI 3(b), HTSUSA, and must be classified as
if each component were imported separately.
HOLDING:
The uppers are classifiable under subheading 6406.10.65,
HTSUSA, as parts of footwear, uppers and parts thereof, other
than stiffeners, other, of leather. The applicable rate of duty
for this provision is 3.7 percent ad valorem.
The leather half insoles for styles "Original" and "BUC" and
the heel pad for style "Chrissie" are classifiable under
subheading 6406.99.60, HTSUSA, as parts of footwear, removable
insoles, heel cushions and similar articles, other, other, of
leather. The applicable rate of duty for this provision is 5
percent ad valorem.
-6-
Merchandise classifiable under subheadings 6406.10.65 and
6406.99.60, HTSUSA, which are products of Thailand are entitled
to duty free treatment under the Generalized System of
Preferences upon compliance with all applicable regulations.
The sock lining for style "Chrissie" is classifiable under
subheading 6406.99.1540, HTSUSA, as parts of footwear, other
other, of other materials, of textile materials, of man- made
fibers, other, with duty at the rate of 5.1 percent ad valorem.
The textile category is 659.
Due to the changeable nature of the statistical annotation
(the ninth and tenth digits of the classification) and the
restraint (quota/visa) categories applicable to textile
merchandise, you should contact your local Customs office prior
to importation of this merchandise to determine the current
status of any import restraints or requirements.
The designated textile and apparel category may be subdivided
into parts. If so, visa and quota requirements applicable to the
subject merchandise may be affected. Since part categories are
the result of international bilateral agreements which are
subject to frequent renegotiations and changes, to obtain the
most current information available, we suggest that you check,
close to the time of shipment, the Status Report On Current
Import Quotas (Restraint levels), an internal issuance of the
U.S. Customs Service, which is available for inspection at your
local Customs office.
Sincerely,
John Durant, Director
Commercial Rulings Division
6cc AD NY Seaport
1cc Dept of Commerce
1cc James Sheridan NY Seaport
1cc Dist Dir Portland Maine
1cc Dist Dir Boston
1cc Tony Cataldo Boston
1cc Legal Reference
cahill library/peh
088483