CLA-2 RR:TC:FC 958452 ALS
Port Director of Customs
U.S. Customs Service
1 E. Bay St., Room 104
Savannah, GA 31401
RE: Request for Further Review of Protest 1704-95-100237, Dated April 28, 1995, Concerning the Classification of a Bead Key Chain with a Miniature Plastic Box Attached Thereto
Dear Mr. Richter:
This is in reference to a protest filed against decisions of
February 10 and March 17, 1995, concerning the classification of
an item invoiced as "Storzalots Key Chain."
FACTS:
The product under consideration is a composite article
consisting of a plastic box with a lid which has an appendage on
both the lid and box through which is threaded a length of
beaded/ball chain with a clasp. The box measure approximately 2
inches by 1 1/4 inches by 5/8 inch. It is a miniature replica of
a full size container marketed by the importer. The box is a
promotional, advertising type of article which is generally given
away at sales demonstration meetings known as "parties" where the
importer's products are demonstrated and sold. The imported
article, which is identified on the invoice and other entry
documents as a key chain, is not sold.
ISSUE:
What is the classification of the subject article?
- 2 -
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 headings and legal notes do not otherwise require, the
remaining GRI's are applied, taken in order.
The subject article was entered under subheading
7117.90.5000, HTSUSA, as imitation jewelry. Both the importer
and Customs at the port of entry have agreed that such
classification was erroneous. The importer has suggested that
the article should be classified in subheading 7315.89.5000,
HTSUSA, which provides for "Chain and parts thereof, of iron or
steel: other chain: Other: Other." The importer notes that the
relative Explanatory Notes (EN) indicate that beaded chain is
included in this provision. The importer has alternatively
suggested that the article should be classified in subheading
7326.20.0050, HTSUSA, as other articles of steel, other.
We note that while there is agreement that the article was
incorrectly entered and liquidated, the port of entry disagrees
with the importer's suggested classifications. It has suggested
that the plastic box, which is attached to the key chain, forms
the essential character of the product and that classification as
an article of plastic is appropriate.
The subject article, which is invoiced as a key chain, is
similar to other promotional key chains distributed by the
importer. They are miniature replicas of products distributed by
the importer and are too small to be functional. We note that
key chains frequently have attachments, whether decorative or
functional. Articles consisting of a key chain with a decorative
attachment have been considered to have the essential character
of the key chain and have been so classified in accordance with
the provisions of GRI 3(b).
When the attachment to the chain appears to be functional a
question arises as to which component, the chain or the
attachment, forms the essential character of the article. In
Headquarters Ruling Letter 950636, dated January 16, 1992, which
covered a plastic photo frame attached to a metal key ring, we
indicated that "the steel element of the subject key rings is
what makes up the utilitarian portion of the key rings. It is
the part that keeps keys together, which is the primary purpose - 3 -
of key rings. The plastic element is present for decorative
purposes and to add bulk to the entity."
Other Headquarters rulings, e.g., HRL 950980, dated January
21, 1992, regarding chains with plastic holders for credit cards
or charms attached thereto, and HRL 089282, dated August 2, 1991,
regarding a key ring with a pencil and miniature memo pad
attached thereto, held that the key chain/ring formed the basis
for classification although the attachments had functional
capabilities. However, such functional capabilities may cause a
question to arise as to which component of the product, if any,
form the essential character of the product, e.g., HRL 081193,
dated August 2, 1988, in which the attachment was a calculator
with a built-in timekeeping mechanism. In that ruling we held
that the essential character was equally dependent on the
calculator and the key chain.
A question arises as to whether the instant article has any
functional capabilities because its lid can be opened and snapped
shut. It has been suggested that the article could be used to
hold a few pills or coins. The broker, however, has advised us
that the article, which is given away as a free promotional item,
is not intended for this purpose, that the plastic hinges would
break if the article was used in such fashion and that the only
reason the plastic box opens is because it is designed to
replicate the importer's full-sized article. We note that if the
article were to be used as a pill box, one would have to presume
that the user would use the chain to attach the article to a belt
or some other article. We do not believe that this is the normal
course of action for the adult female consumer, to whom the
importer markets it product, or a male consumer. Our observation
is that the user of a pill box would keep it in another
container, such as a purse, or a pocket, and not attach it to a
belt of other article. In this regard, we note that the importer
has distributed other miniature replicas of its products as
promotional items and that these items are too small to be
functional. Thus, we believe that it was intended that the ball
chain function as a key chain rather than an attaching device,
that the chain is the primary functional component of the article
and that the plastic article merely serves as a reminder of the
availability of certain of the importer's products. Accordingly,
we have concluded that the chain is the focus for the proper
classification of the composite article and that it is not
classifiable as an article of plastic.
Since it is agreed that the article is not an article of
imitation jewelry, the questions remains as to under which of two
subheadings in chapter 73, HTSUSA, the article should classified. - 4 -
The suggested alternatives are subheading 7315.89.5000, HTSUSA,
which provides for chain and parts thereof, of iron or steel:
other chain and subheading 7326.90.8585, HTSUSA, which provides
for other articles of iron or steel. We note that subheading
7315.89.5000, HTSUSA, more specifically describes the article
under consideration. Further, the Explanatory Notes to the
Harmonized System (EN), which represent the view of the
international classification experts, specifically notes that
heading 73.15 covers ball chain. Accordingly, we have concluded
that the subject article should be classified thereunder.
HOLDING:
Ball/beaded chain with a clasp to which a miniature plastic
box is attached is considered to be a key chain and is
classifiable in subheading 7315.89.5000, HTSUSA, which provides
for Chain and parts thereof, of iron or steel: Other chain:
Other: Other.
Since reclassification of the merchandise as indicated above
will result in a lower rate of duty than the liquidated or
claimed rate you are instructed to allow the protest in full.
A copy of this ruling should be attached to the Customs Form
19 and provided to the protestant as part of the notice of action
on the protest.
In accordance with Section 3A(1)(b) of Customs Director 099
3550-065, dated August 4, 1993, Subject: Revised Protest
Directive, this decision should be provided by your office to the
protestant no later than 60 days from the date of this letter.
Any reliquidation of the entries in accordance this decision must
be accomplished prior to the 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