CLA-2 CO:R:C:T 089386 JS
Steven W. Baker
Bellsey and Baker
100 California Street
Suite 670
San Francisco, CA 94111
RE: Modification of HRL 088314; ladies' evening bag;
classifiable as "in part of braid," heading 4202, HTSUSA
Dear Mr. Baker:
This in reference to your request for reconsideration of HRL
088314 (issued April 7, 1991) which overturned the decision in
NYRL 832975 classifying a ladies' evening bag under subheading
4202.22.4030, HTSUSA. Upon further review, we find that HRL
088314 is in error.
FACTS:
The goods at issue are ladies' evening bags which have
visibly braided shoulder straps. NYRL 832975 classified these
articles as "in part of braid." HQ 088314 reversed that
determination and classified the merchandise as "not in part of
braid," applying the de minimis rule articulated in Varsity Watch
Company v. United States, 34 CCPA 155, C.A.D. 359 (1947), and
prior Headquarters rulings.
ISSUE:
Whether a braided strap on an evening bag is considered "in
part of braid" under the HTSUSA.
LAW AND ANALYSIS:
You cite several court decisions and Headquarters rulings
in support of your argument that the braided strap in the present
merchandise is "in part of braid." You assert that these
determinations have been improperly altered by our current
position regarding the presence of braid on such goods.
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Heading 4202, which provides for handbags, is undisputed as
the applicable heading for classification. However, a further
distinction exists at the subheading level with regard to whether
a bag is "wholly or in part of braid" or "not in part of braid."
Since the only braid apparent on the bags at issue are the
braided shoulder straps, our analysis will be limited to
whether the bags are "in part of braid." General Note 7 provides
that, for the purposes of the tariff schedule, and unless the
context otherwise requires,
(e) the terms "wholly", "in part of" and "containing", when
used between the description of an article and a
material (e.g. woven fabrics, wholly of cotton"), have
the following meanings:
.
.
(ii) "in part of" or "containing" mean that the goods
contain a significant quantity of the named
material.
With regard to the application of the quantitative
concepts specified above, it is intended that the de
de minimis rule apply.
Our past determinations have rested on interpretation of the
de minimis rule with respect to the articles presented. The
rule states that an ingredient or component of an article may be
ignored for classification purposes depending upon "whether or
not the amount used has really changed or affected the nature of
the article and, of course, its salability." Varsity Watch
Company v. United States, 34 CCPA 155, C.A.D. 359 (1947). We
find it appropriate to re-examine the application of the de
minimis rule for the following reasons. You have stated that the
strap on this evening bag is a particularly desirable and
important feature of the item, that "for the evening bags under
consideration, the braided shoulder straps are visible,
important, 'commercially significant' components, which add to
the elegance, utility, and salability of the bags; you state that
the braid does far more than just 'give form' to a handle..."
We note that the strap is fully functional and likely to be
used to carry the bag over the shoulder, despite its capacity to
be folded into the bag, clutch-style. The braided strap
constitutes the most commonly used handle of the purse, and as
such, is certainly a commercially significant part. The braid
itself is a more extravagant way of forming the shoulder strap,
and adds to the expense and complexity of manufacture. We agree
that it complements and highlights the dressy nature of the bags
at issue. Moreover, the amount of braid on the purse is
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significant where it forms the entire length of the shoulder
strap. Thus, it enhances the utility and style of the bag, which
makes the article marketable for evening wear.
The de minimis rule in this case has been satisfied, since
a strap on an evening bag is a substantial part of the bag, one
which in this instance, affects the nature of the article and
distinguishes it for evening or formal wear. In this respect,
we agree with your assertions and deem the samples at issue to be
"wholly or in part of braid."
In several of the previous Customs decisions which
classified similar bags as "not in part of braid", we find that
the amount or significance of the braid was indeed de minimis;
for instance, HRL 081483 (April 27, 1989) a bag with a small
braided strip of fabric, measuring 1/8 inch wide and attached to
the top of the bag to hold together gathers is considered not in
part of braid; another bag style in the same ruling was also
considered de minimis where the braid was sewn into the fabric so
that it could not be seen. Similarly, HRL 088050 considered de
minimis a small braided strip of fabric, measuring 1/8 inch wide,
which was used to hold the gathers of a child's handbag secure.
HOLDING:
Pursuant to the analysis above, we find that the braided
shoulder straps on the evening bags at issue are more than de
minimis, and that the articles are correctly classified under
subheading 4202.22.4030, HTSUSA, which provides for travelling
bags, toiletry bags, knapsacks and backpacks, handbags, shopping
bags, wallets, purses, map cases, cigarette cases, tobacco
pouches, tool bags, sports bags, bottle cases, jewelry boxes,
powder cases, cutlery cases and similar containers, of leather or
of composition leather, of plastic sheeting, of textile
materials, of vulcanized fiber or of paperboard, or wholly or
mainly covered with such materials: handbags, whether or not with
shoulder strap, including those without handle: with outer
surface of plastic sheeting or of textile materials: with outer
surface of textile materials: wholly or in part of braid: other:
other: of man-made fibers, textile category 670, dutiable at the
rate of 8.4 percent ad valorem.
In order to assure uniformity in Customs classification of
this merchandise and eliminate uncertainty, we are modifying HRL
088314 to reflect the above classification effective with the
date of this letter. However, if you disagree with the legal
basis for our decision, we invite you to submit any arguments you
might have with respect to this matter for our review. Any
submission you wish to make should be received within 30 days of
the date of this letter.
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This notice to you should be considered a modification of
Headquarters Ruling Letter 088314 under 19 CFR 177.9(d)(1)
(1989). It is not to be applied retroactively to HRL 088314 (19
CFR 177.9(d)(2) (1989)) and will not, therefore, affect the
transaction for importation of your client's merchandise under
that ruling. However, for the purposes of future transactions in
merchandise of this type, including that for which the present
classification was requested, HRL 088314 will not be valid
precedent. We recognize that pending transactions may be
adversely affected by this modification, in that current
contracts for importation arriving at a port subsequent to the
release of HRL 088314 will be classified under the new ruling.
If such a situation arises, your client may, at its discretion,
notify this office and apply for relief from the binding effects
of the new ruling as may be dictated by the circumstances.
However, please be advised that in some instances involving
import restraints, such relief may require separate approvals
from other government agencies.
The designated textile and apparel category may be
subdivided into parts. If so, the 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 your client check, close the time of shipment, the Status
Report on Current Import Quotas (Restraint Levels), an issuance
of the U.S. Customs Service which is updated weekly and is
available for inspection at your local Customs office.
Due to the changeable nature of the statistical annotation
(the ninth and tenth digits of the classification) and the
restraint (quota/visa) categories, your client should contact its
local Customs office prior to importation of this merchandise to
determine the current status of any import restraints or
requirements.
Sincerely,
John Durant, Director
Commercial Rulings Division