CLA-2 CO:R:C:F 954579 ALS
Tariff NO.: 2208.30.3030; 2208.30.6065; 2208.20.4000
Mr. John B. Pellegrini
Ross and Hardies
65 East 55th Street
New York, New York 10022-3219
RE: Alcoholic Beverages Packaged with Two Drinking Glasses
in a Gift Box
Dear Mr. Pellegrini:
This is reference to your letter of June 21, 1993,
concerning the classification of gift sets composed of a bottle
of spirits and 2 glasses in a box.
FACTS:
The subject merchandise consists of gift sets of spirits
packaged with 2 glasses. Each set will contain a 750 ml bottle
of one of 5 different types of spirits packaged with 2 glasses in
a gift box. The spirit components of each gift set will consist
of one of two types of scotch, one of two types of cognac or a
type of Canadian whisky. The value of each bottle of spirits is
considerably greater than the value of the two glasses in each
set, representing 75 percent or more of the total value of each
set. All the spirits and glasses are imported and will be
entered into a foreign trade zone where the various spirits and
glasses will be packaged in gift boxes and withdrawn as sets.
The importer will not seek privileged foreign status for any of
the above components. Although the inquiry does not provide any
particulars as to the gift box used for packaging, we understand
it will be an inexpensive cardboard type container and that it
will not be reusable.
- 2 -
ISSUE:
Are the above components separately classifiable or are they
classifiable as sets?
LAW AND ANALYSIS:
Classification of merchandise under the Harmonized Tariff
Schedule of the United States Annotated (HTSUSA) is governed by
the General Rules of Interpretation (GRI's) taken in order.
GRI 1 provides that the classification is determined first in
accordance with the terms of the headings and any relative
section and chapter notes. If GRI 1 fails to classify the goods
and if the heading and legal notes do not otherwise require, the
remaining GRI's are applied, taken in order.
In considering the classification of the above spirits and
drinking glasses we note that the spirits are classifiable in one
of 3 subheadings of Chapter 22 of the HTSUSA and that the glasses
would be classifiable in Chapter 70, HTSUSA. For the purposes of
classification we presume that, while the nature and origin of
the packaging are unknown, it would meet the requirements of
GRI 5 and would be dutiable with its contents rather than being
separately dutiable. We also note that all the merchandise will
be nonprivileged foreign merchandise and will be, pursuant to
section 146.65(a)(2), Customs Regulations (19 CFR 146.65(a)(2)),
subject to duty in its condition and quantity when transferred
from the foreign trade zone to the customs territory of the
United States.
Since there is no specific heading that refers to all the
components of the sets and since each of the subheadings refers
to only a part of the set, we referred to GRI 3 which, pursuant
to GRI 2, provides that goods classifiable under 2 or more
headings shall be classified according to the provisions of
GRI 3. Although GRI 3(a) provides that the heading with the most
specific description shall be preferred to other headings, when 2
or more headings refer to a part only of the materials or
substances contained in mixed or composite goods, the headings
are to be considered as equally specific. We found that to be
the case with this article so it could not be classified under
that GRI.
We next referred to GRI 3(b) which covers mixtures,
composite goods consisting of different materials or made up of
different components and goods put up in sets for retail sale - 3 -
which cannot be classified by reference to GRI 3(a). In
considering whether the subject articles are sets for retail sale
in accord with GRI 3(b), we evaluated the articles against the
specified requirements which a product must meet to qualify for
classification thereunder. The articles must:
(a) consist of at least 2 different articles which are
prima facie classifiable in different headings;
(b) consist of products or articles put up together to
meet a particular need or carry out a specific
activity; and
(c) be put up in a manner suitable for sale directly
to users without repacking.
We believe that the articles under consideration meet all
those requirements. The individual components of the sets will
clearly be packaged for sale at retail, they are composed of at
least 2 different articles classifiable in different headings,
and the contents of each set will permit the purchaser thereof to
imbibe an alcoholic beverage.
In considering which of the components give the sets their
essential character we noted 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 the
goods. Since the alcoholic beverages form 75 percent or more of
the value of each set and since the retail purchaser of the set
would clearly purchase the set for its alcoholic beverage
content, we believe the spirits form the essential character of
the set and should serve as the basis for classification thereof.
HOLDING:
A gift set, packaged in a foreign trade zone and composed of
a bottle of spirits and 2 glasses in an inexpensive and non-
reusable gift box, is dutiable in its condition as withdrawn from
such zone. Such sets are classifiable in the subheading
applicable to the spirit component of each set. The sets
composed of scotch whisky and 2 glasses are classifiable in
subheading 2208.30.3030, HTSUSA, and are subject to a general
rate of duty of 5.3 cent per proof liter. The sets composed of - 4 -
cognac, valued over $3.43 a liter, and 2 glasses are classifiable
in subheading 2208.20.4000, HTSUSA, and are subject to a general
rate of duty of 13.2 cents per proof liter. The sets composed of
Canadian whisky and 2 glasses are classifiable in subheading
2208.30.6065, HTSUSA, and are subject to a general rate of duty
of 6.6 cents per proof liter. All the sets may be subject to
Federal Excise Tax.
Sincerely,
John Durant, Director
Commercial Rulings Division