CLA-2 CO:R:C:M 950279 DFC
Steven B. Lehat, Esq.
Sheldon & Mak
Attorneys
201 South Lake Avenue, Suite 800
Pasadena, California 91101
RE: Reconsideration of Headquarters Ruling Letter (HRL) 088771
dated April 30, 1991, and New York Ruling Letter (NYRL)
857390 dated November 19, 1990. Insole, polyurethane/nylon
HRL 088771 and NYRL 857390 modified
Dear Mr. Lehat:
In a letter dated August 22, 1991, you asked that the result
reached in HRL 088771 dated April 30, 1991, as to the tariff
classification of plastic polyurethane/textile nylon insoles be
reconsidered. Specifically, you were advised that this
merchandise is classifiable under subheading 6406.99.15,
Harmonized Tariff Schedule of the United States Annotated
(HTSUSA), as parts of footwear, removable insoles, heel cushions
and similar articles, other, of other materials, of textile
materials, with duty at the rate of 17 percent ad valorem. The
applicable textile category is 659.
FACTS:
The insoles involved are constructed by joining polyurethane
with nylon.
You renew the claim that the insoles are properly
classifiable under subheading 6406.99.30, HTSUSA, as parts of
footwear, removable insoles, heel cushions and similar articles,
other, of other materials, of rubber or plastics.
ISSUE:
Are the insoles "of textile materials" or "of rubber or
plastics."?
-2-
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.
Legal Note (LN) 3 to Chapter 64, HTSUSA, states that "[f]or
the purposes of this chapter, the expression 'rubber or
plastics' includes any textile material visibly coated (or
covered) externally with one or both of those materials."
The Harmonized Commodity Description and Coding System
Explanatory Notes (EN) to the HTSUSA, although not dispositive,
should be looked to for the proper interpretation of the HTSUSA.
See 54 FR 35128 (August 23, 1989). EN (E) to Chapter 64, HTSUSA,
states that "[i]t should be noted that for the purposes of this
Chapter, the expression 'rubber or plastics" includes any textile
material visibly coated or covered externally with one or both of
those materials, which means that the coating or covering can be
seen with the naked eye with no account being taken of any
resulting change of colour."
EN (F) to Chapter 64, HTSUSA, states that "[s]ubject to the
provisions of (E) above, for the purposes of this Chapter the
expression 'textile materials' covers the fibers, yarns, fabrics,
felts, nonwovens, twine, cordage, ropes, cables, etc., of
Chapters 50 to 60."
In HRL 088771 Customs took the position that the insoles do
not meet the requirements of LN 3 as being 'rubber or plastics'
because the plastic layer is completely hidden in the finished
shoe and only the textile layer can be seen. You assert that the
rationale for this position is flawed. You argue that since the
insoles are not merely shoe 'parts,' but shoe 'accessories' with
a separate identity, there is no reason to assume that the tariff
requires a plastic visibility beyond that which the consumer
encounters when purchasing the product. Further, you state that
the Customs position with respect to the applicability of LN 3
does not distinguish between 'parts' and 'fittings.' You assert
that the EN expressly separates 'parts' from 'fittings,' i.e.,
removable insoles. Thus, you reason that similar treatment of
'parts' and 'fittings' under LN-3 does not necessarily follow.
You urge that such independent removable fittings be viewed apart
from how they appear in shoes in which case there would be no
dispute about the visibility of the 'rubber or plastics.'
-3-
We have reconsidered our position on this point and are now
of the opinion that LN 3 to Chapter 64 is not relevant in
determining the classification of the insoles. Our rationale
for this change in position is that the term "externally" as
used in LN 3 to Chapter 64 has reference to the outside of the
shoe. Consequently, LN 3 is inapplicable here because the
insoles are obviously inside the shoes.
As you have previously informed us the inner sole is not
formed from pre-existing textile plastic laminates. In this
instance, the textile component of the inner sole is applied to a
molded plastic insole, During the molding process the plastic
is in liquid form. The nylon textile is glued thereon as the
plastic solidifies. The plastic portion of the inner sole is
identifiable as the article itself when joined to the textile.
Consequently, you assert that the inner sole is clearly not
manufactured from pre-existing textile/plastic materials such
that the nature of the merchandise is determined under the
textile chapters.
In HRL 088771 we stated that "[w]e do not agree with you
that GRI 3(b) applies in this instance Specifically, per GRI
3(a), GRI 3(b) applies 'when two or more headings each refer to
part only of the materials or substances contained in mixed or
composite goods.' 'Textile materials,' using the notes to the
Chapters and headings (in accordance with GRI 1) applies, in
general, to laminated fabrics, that is, to the combination of
textile fibers and plastics when laminated together. Since
'textile materials' applies to all the material of the insole,
application of GRI 3(b) appears inappropriate. We take the
position that the intent of EN (F) is to apply the products of
Chapters 50 to 60 to Chapter 64 and thus, presumably, also its
principles.
We have reconsidered our position in this matter and are now
of the opinion that the insoles are not textile fabrics,
impregnated, coated, covered or laminated with plastics within
the purview of Chapter 59, HTSUSA. The insoles are composite
articles the classification of which is governed by GRI 3(b)
which reads as follows:
3(b) Mixtures, composite goods consisting of different
materials or made up of different components, . . .
which cannot be classified by reference to 3(a), shall
be classified as if they consisted of the material or
component which gives them their essential character,
insofar as this criterion is applicable.
-4-
EN VIII to GRI 3(b) at page 4, reads as follows:
(VIII) 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,
its bulk, quantity, weight or value, or by
the role of the constituent material in
relation to the use of the goods.
It is our observation that the essential character of the
insoles is imparted by the plastics. Our rationale for this
conclusion is based on the following factors:
1. the shape of the insoles is due to their plastic
contents;
2. the plastic cushions the foot thus providing shock
absorbency and arch support;
3. the plastic component of the insoles far outweighs the
nylon portion; and
4. although the nylon may provide a comfort factor it is
not significant with respect to the identity of the
product.
For the reasons stated above, the insoles are classifiable
under subheading 6406.99.30, HTSUSA, as parts of footwear,
removable insoles, heel cushions and similar articles, other, of
other materials, of rubber or plastics.
HOLDING:
The nylon/polyurethane insoles are dutiable at the rate of
5.3 percent ad valorem under subheading 6406.99.30, HTSUSA.
Both HRL 088771 and NYRL 857390 are modified to reflect the
result reached here.
Sincerely,
John Durant, Director
Commercial Rulings Division
6 cc AD NY Seaport
1cc J Sheridan NY Seaport
1cc G. Barth NY Seaport
1cc John Durant
1cc Legal Reference