CLA-2 CO:R:C:T 950397 SK
Mr. Geoff Phillips
Tic-La-Dex Business Systems, Inc.
3443 Camino Del Rio South
Suite 326
San Diego, CA 92108-3901
RE: Revocation of Headquarters Ruling Letter 087439 (10/30/90);
4820, HTSUSA; GRI 3(b); portfolio not container of heading
4202; planner; organizer
Dear Mr. Phillips:
In our letter of May 14, 1991, this office advised you that
HRL 087439, concerning the tariff status of an unassembled
portfolio, was modified with respect to our analysis which
determined the merchandise to constitute a set under General
Interpretative Rule 3(b). It has since been brought to our
attention that the classification of the subject portfolio as a
container in heading 4202, HTSUSA, may be incorrect.
FACTS:
The articles at issue, designated as Style Number 61010, is
a portfolio designed to contain the following items:
1) a two year monthly calendar (planner);
2) a built-in calculator;
3) 100 color assorted "calendar" cards (3" x 5");
4) a removable credit card wallet;
5) a writing pad (8" x 10");
6) a full-size file folio section,
7) pockets for business cards and papers;
7) a portfolio fitted with lock and key, the outer surface of
which is a fabric-backed cellular plastics material.
- 2 -
The various components were to be shipped into the United
States in separate cartons in the same import container. The
components (outer cover, main body and hardware) were to be
assembled in the United States by means of simple fixing devices
such as sewing and gluing. Remaining articles were to be
inserted into the finished portfolio.
ISSUE:
Whether the subject merchandise is classifiable under
heading 4820 of the Harmonized Tariff Schedule of the United
States Annotated (HTSUSA), which provides for, inter alia,
notebooks, letter pads, memorandum pads, diaries and similar
articles?
LAW AND ANALYSIS:
Classification of goods under the HTSUSA is governed by the
General Rules of Interpretation (GRI's). GRI 1 provides that
classification is determined first in accordance with the terms
of the headings of the tariff and any relative section or chapter
notes. Where goods cannot be classified solely on the basis of
GRI 1, and if the headings and legal notes do not otherwise
require, the remaining GRI's may be applied in the order of their
appearance.
Heading 4202, HTSUSA, provides for various containers. In
Headquarters Ruling Letter (HRL) 088430, dated April 11, 1991,
this office determined that heading 4202, HTSUSA, was not
applicable to articles such as "planners" and "organizers."
Customs held that a tri-fold planner was not the type of
merchandise which would fall within the definition of "similar
containers" as set forth in heading 4202, HTSUSA.
"Although the planner may appear to be related to the
containers of heading 4202, HTSUSA, they are not similar
in that they are not designed or intended for use in a
similar manner, nor do they exhibit the requisite physical
attributes that Customs has found common to goods of
heading 4202, HTSUSA."
The article at issue is primarily intended to organize
information and belongings and, as such, it is not similar to
those containers enumerated in heading 4202, HTSUSA.
- 3 -
Heading 4820, HTSUSA, covers articles that are associated
with stationary, record keeping and organizational aids. All the
items included in the subject merchandise, except the calculator,
are akin to those items enumerated in heading 4820, HTSUSA: the
calander, writing pad and assorted pockets for credit cards and
business cards are all used to keep records of activities and aid
organization. The calculator, however, is not provided for in
heading 4820, HTSUSA, as it is a battery-operated item and not
normally associated with stationary and notepads, etc.
Calculators are classifiable in heading 8470, HTSUSA, which
provides for calculating machines.
In this instance, GRI 1 is not determinative of the subject
merchandise's tariff status because more than one heading
potentially governs classification of this article. The
pertinent headings are 4820, HTSUSA, which provides for
notebooks, memorandum pads and similar articles, and 8470,
HTSUSA, which provides for calculating machines. When goods are,
prima facie, classifiable under two or more headings of the
Nomenclature, classification shall be as follows:
3(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 ... 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.
As mentioned supra, both headings 4820 and 8470, HTSUSA,
apply with equal specificity to the subject merchandise. Each
heading applies to a part of the portfolio, but neither heading
provides for the article in its entirety. Accordingly,
appropriate analysis is provided by GRI 3(b):
3(b) ... 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.
- 4 -
Explanatory Note VIII to GRI 3(b) states:
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 the goods.
This office agrees with the conclusion reached in HRL
087439, that the component which constitutes the most distinctive
feature of the article and which plays the dominant role in its
function as an organizer and planner, is the portfolio. The role
of the portfolio with its paper, cards and pockets is
indispensable to the overall use of the item. The portfolio is
more than a container; it functions to bring together all the
component goods to enable the user to employ them in a
coordinated and organized fashion. The calculator is a valuable
tool, however it does not provide the main function of this
article nor is its monetary value such that it is the most costly
component. The essential character of the subject merchandise is
that of a portfolio, and classification is proper under heading
4820, HTSUSA, which provides for articles of this nature.
HOLDING:
The article at issue is classifiable under subheading
4820.10.2050, HTSUSA, which provides for registers, account
books, notebooks, order books, receipt books, letter pads,
memorandum pads, diaries and similar articles, exercise books,
blotting pads, binders (looseleaf or other), folders, file
covers, manifold business forms, interleaved carbon sets and
other articles of stationary, of paper or paperboard; registers,
account books, notebooks, order books, receipt books, letter
pads, memorandum pads, diaries and similar articles: diaries,
notebooks and address books, bound; memorandum pads, letter pads
and similar articles ... other. The applicable rate of duty is 4
percent ad valorem.
In order to ensure uniformity in Customs' classification of
this merchandise and eliminate uncertainty pursuant to section
177.9(d)(1), Customs Regulations (19 CFR 177.9(d)(1)), HRL 087439
is revoked effective with the date of this letter, to reflect the
above classification and the fact that items imported in separate
boxes are not considered as put up in sets for retail
- 5 -
sale. If, after your review, you disagree with the legal basis
for our decision, we invite you to submit any arguments you might
have with respect to this matter. Any submission you wish to
make should be received within 30 days of the date of this
letter.
This revocation is not retroactive. However, HRL 087439
will not be valid for importations of the subject merchandise
arriving in the United States after the date of this notice. We
recognize that pending transactions may be adversely affected
(i.e., merchandise previously ordered and arriving in the United
States subsequent to this revocation will be classified
accordingly). If it can be shown that you relied on HRL 087439
to your detriment, you may apply to this office for relief.
However, you should be aware that in some instances involving
import restraints, such relief may require separate approvals
from other government agencies.
Due to the changeable nature of the statistical annotation
(the ninth and tenth digits of the classification) and the
restraint (quota/visa) categories, you should contact your 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