CLA-2 R:C:F 958245 RC
Port Director of Customs
2nd and Chestnut Streets
Philadelphia, Pennsylvania 19106
RE: Application for Further Review of Protest No. 1101-95-100222, filed April 13, 1995, concerning the classification of Lighted Ceramic Houses; Festive Articles; Protest No. 3501-90-000048 Distinguished; HRL 088504 Distinguished; Burden of Proof Regarding Traditional Use
Dear Sir:
This is a decision on a protest filed against your decision in the classification of goods entered in 1994 and liquidated January 13, 1995.
FACTS:
You classified the product in subheading 6913.10.5000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), the provision for ornamental articles of porcelain or china, dutiable in 1994 at the column one general rate of 9 percent ad valorem. This represented a change from the protestant's entered classification under heading 9505, HTSUSA, the provision for festive articles, dutiable in 1994 at the column one general rate of 5.8 percent ad valorem.
The articles are lighted ceramic houses identified as "Santa's Village," "Santa Claus," "Santa's Reindeer," "Bunk House," et al. The merchandise comprising the collections is the same as, or substantially similar to, goods which are the subject of: Headquarters Ruling Letter (HRL) 088504, issued February 3, 1992 (relating to Protest No. 3501-90-000048); the Stipulated Judgment on Agreed Statement of Facts, entered by the Court of International Trade on August 4, 1994; and various other entries.
ISSUE:
Whether the lighted porcelain or ceramic houses are classified in heading 6913, HTSUS, as statuettes and other ornamental porcelain or ceramic articles, or in heading 9505, HTSUS, as festive articles.
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). The systematic detail of the harmonized system is such that virtually all goods are classified by application of GRI 1, that is, according to the terms of the headings of the tariff schedule and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied. The Explanatory Notes (ENs) to the Harmonized Commodity Description and Coding System, which represent the official interpretation of the tariff at the international level, facilitate classification under the HTSUS by offering guidance in understanding the scope of the headings and GRIs.
Heading 9505, HTSUS, provides for, among other items, festive, carnival, and other entertainment articles. The EN to 9505 indicates that the heading covers:
(A) Festive, carnival or other entertainment articles, which
in view of their intended use are generally made of non-
durable material. They include:
(1) Decorations such as festoons, garlands, Chinese
lanterns, etc., as well as various decorative articles
made of paper, metal foil, glass fibre, etc., for
Christmas trees (e.g., tinsel, stars, icicles),
artificial snow, coloured balls, bells, lanterns, etc.
Cake and other decorations (e.g., animals, flags) which
are traditionally associated with a particular festival
are also classified here.
(2) Articles traditionally used at Christmas
festivities, e.g., artificial Christmas trees (these
are sometimes of the folding type), nativity scenes,
Christmas crackers, Christmas stockings, imitation yule
logs....
In general, merchandise is classifiable in heading 9505, HTSUS, as a festive article when the article, as a whole:
1. is of non-durable material or, generally, is not
purchased because of its extreme worth, or intrinsic
value (e.g., paper, cardboard, metal foil, glass fiber,
plastic, wood);
2. functions primarily as a decoration (e.g., its primary
function is not utilitarian); and
3. is traditionally associated or used with a particular
festival (e.g., stockings and tree ornaments for
Christmas, decorative eggs for Easter).
Articles classifiable in heading 9505, HTSUS, tend to serve no other function than decoration. Further, the motif of an item is not dispositive of its classification and, consequently, does not transform an item into a festive article.
In HRL 088504, the merchandise consisted of two groups of ornamental ceramic ware depicting buildings, figurines, and miscellaneous accessories. The first group, composed of porcelain and identified as the "Heritage Village Collection," included the "Dickens Village," "Alpine Village," "New England Village," "Christmas in the City," and the "Little Town of Bethlehem Collection." This merchandise was classified in subheading 6913.10.50, HTSUS, the provision for statuettes and other ornamental ceramic articles, of porcelain, other, other, with an applicable duty rate of 9 percent ad valorem.
The second group, composed of earthenware, was identified as the "Snow Village Collection." This merchandise was classified in subheading 6913.90.50, HTSUS, the provision for statuettes and other ornamental articles, other than of porcelain or china, other, other, with an applicable duty rate of 7 percent ad valorem.
The basis in HRL 088504 for not including the above articles in subheading 9505.10.50, was that they were not traditionally associated with Christmas festivities. Upon further review of the record available at the time HRL 088504 was issued, we found that HRL 088504 was correct. The evidence available to Customs at the time showed the merchandise lacked a traditional association with a particular festival (i.e., Christmas).
On February 8, 1995, Customs and Department of Justice personnel met with counsel for the importer of the merchandise which was the subject of HRL 088504. At that time, additional written submissions and oral arguments were presented on behalf of the importer regarding the factual issue of traditional use. Based upon the additional oral or written evidence of traditional use, presented at the February 8, 1995 meeting, Customs found the importer had substantiated its claim of the traditional use of the articles covered by the ruling, thus successfully carrying its burden of proof. It was for this reason that Customs concurred in the stipulated judgment of the case. In addition to our stipulation, Customs issued a binding ruling to that importer, based on the additional facts developed, providing for treatment of the goods in subheading 9505.10.50. This ruling is HRL 957706, issued June 21, 1995.
Although, in general, ornamental ceramic articles are not traditionally associated or used with a particular festival, based on our review of the file and the evidence presented, we find that lighted ceramic houses as part of a village are of a kind that has traditionally been associated with Christmas. It is our determination that the goods meet all criteria indicated above for classification as festive articles.
The lighted ceramic houses are classified in subheading 9505.10.50, HTSUS, the provision for "Festive, carnival or other entertainment articles...parts and accessories thereof: Articles for Christmas festivities and parts and accessories thereof: Other: Other." The applicable duty rate for entries of this merchandise made through December 31, 1994, was 5.8 percent ad valorem.
HOLDING:
You are instructed to deny the protest, except to the extent classification as indicated above results in a partial allowance. A copy of this decision should be attached to the Customs Form 19, Notice of Action on the protest, to be returned to the protestant.
In accordance with Section 3 A (11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days
from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, Freedom of Information Act and other public access channels.
Sincerely,
John Durant, Director
Tariff Classification
Appeals Division