CLA-2 RR:CR:TE 959512 GGD
Port Director
U.S. Customs Service
300 South Ferry Street
Terminal Island, California 90731
RE: Withdrawal of Application for Further Review; Protest No.
2704-96-101888 Denied; Protest Issues Treated as Internal
Advice Request Concerning Classification of Wallets or Small
Handbags
Dear Sir:
By letter dated November 17, 1998 (copy attached), an Application for Further Review (AFR) of the protest referenced above was withdrawn. The protest should therefore be denied. Despite the withdrawal of the AFR and the denial of the protest, however, there remain substantial issues, the discussion of which may benefit Customs field personnel and the importing community. We therefore consider this letter to be a response to an Internal Advice Request made pursuant to 19 CFR 177.11(a), concerning the issues raised by the protestant.
FACTS:
The first of two samples at issue, identified by item PLDFN 9520, has an outer layer composed of fabric-backed compact plastics and the plastic surface faces outward. The item measures approximately four inches in height in the closed position (eight inches when open) by 7-1/4 inches in width by one inch in depth. The article is of a trifold, envelope shape and it has a snap closure. Its interior features two transparent flat slot pockets for identification or credit cards, a full-
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width flat pocket behind these, a permanently attached checkbook jacket (with a flat slot pocket and four transparent envelopes for photos or credit cards), two rows of three credit card slots, a full-width gusseted pocket behind the slots, a zippered flat, full-width pocket behind the gusseted pocket, and an additional flat, open, full-width pocket. On the article’s back exterior is an additional zippered compartment which opens to reveal a double gusseted, full-width pocket with a divider. The gussets allow this divided, zippered pocket to expand and form an opening which measures approximately 5-1/4 inches wide at the top. The gusseted pockets are capable of holding several small three-dimensional objects at one time.
The second sample, identified by item R8153, has an outer layer composed of cellular plastics backed by a simple knit fabric. The plastic surface faces outward. The item measures approximately four inches in height in the closed position (8-1/4 inches when open) by 5-3/4 inches in width by 1-1/4 inch in depth. The article is a bifold container, and it has a zipper closure extending along three sides. The item’s interior features a transparent flat slot pocket for an identification card, two flat pockets behind the card slot (one of which has an insert of four transparent envelopes for photos or credit cards), two open credit card slots, and a large flat pocket (which measures approximately 7-1/2 inches by 4-1/2 inches) behind all the other interior pockets. Attached to the item’s rear exterior is a flat loop by which the item may be attached to and worn on a belt. On the article’s front exterior is an additional zippered compartment which opens to reveal a gusseted, full-width pocket with a leather strap and key ring attached to the interior. The gussets allow this zippered pocket to expand and form an opening which measures approximately 3-3/4 inches wide at the top. The gusseted pocket is capable of holding several small three-dimensional objects at one time.
ISSUE:
Whether the goods are properly classified in subheading 4202.32, HTSUS, as articles of a kind normally carried in the pocket or in the handbag; or in subheading 4202.22, HTSUS, as handbags.
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRI). GRI 1 provides that the classification of goods shall be determined according to the
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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 GRI may then be applied. The Explanatory Notes (EN) 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 GRI.
Among other goods, heading 4202, HTSUS, provides for traveling bags, handbags, wallets, and similar containers. Since both styles of merchandise are similar to handbags and/or to wallets, they are covered by the heading. Additional U.S. Note 2 to Chapter 42, HTSUS, states:
For purposes of classifying articles under subheadings 4202.12, 4202.22, 4202.32, and 4202.92, articles of textile fabric impregnated, coated, covered or laminated with plastics (whether compact or cellular) shall be regarded as having an outer surface of textile material or of plastic sheeting, depending upon whether and the extent to which the textile constituent or the plastic constituent makes up the exterior surface of the article.
Subheading 4202.22 (as well as subheadings 4202.21 and 4202.29), HTSUS, covers handbags, whether or not with shoulder strap, including those without handles.
Subheading 4202.32 (as well as subheadings 4202.31 and 4202.39), HTSUS, covers articles of a kind normally carried in the pocket or handbag. The subheading EN to these three subheadings states:
These subheadings cover articles of a kind normally carried in the pocket or in the handbag and include spectacle cases, note-cases (bill-folds), wallets, purses, key-cases, cigarette-cases, cigar-cases, pipe-cases and tobacco-pouches.
On June 21, 1995, this office published a General Notice in the Customs Bulletin, Volume 29, Number 25, concerning goods identified as “Wallets on a String.” The attributes of both handbags and articles of a kind normally carried in the pocket or
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in the handbag were discussed. With regard to Articles of a Kind Normally Carried in the Pocket or in the Handbag, the notice stated in pertinent part that:
Such articles include wallets, which may be described as flat cases or containers fitted to hold credit/ identification cards, paper currency, coins and in some instances a checkbook holder. Articles meeting this description which also possess a detachable carrying strap have been classified as flatgoods.
In order to be classifiable as a flatgood, the article must fit comfortably in a handbag or pocket. For example, rectangular or square cases measuring approximately 7-1/2 inches by 4-1/2 inches, or 4-3/4 inches by 4-1/2 inches, in their closed position, have been classified as flatgoods.
Combining the characteristics of two flatgoods does not transform a flatgood into a handbag. Thus, the addition of a spectacle case holder to what is otherwise nothing more than a flat case with a carrying strap has been classified as a flatgood.
With respect to Handbags, the notice stated that:
A handbag functions as a carry-all container for various small personal effects:
A container which is not fitted to hold articles such as credit/identification cards, paper currency, coins or a checkbook holder is classifiable as a handbag. Therefore, a clutch bag or an evening bag measuring, for example, 7-1/2 inches by 4-1/2 inches, shall be classified as a handbag.
The determinative feature of a handbag is its ability to hold several objects not associated with a wallet. A bag which may accommodate articles such as a hairbrush, cosmetics, keys and other loose personal effects shall be classified as a handbag, even if it also incorporates the features of a flat case fitted to hold the items set forth above.
The presence of gusseted and/or zippered compartments will be taken into consideration in a determination of whether a case has generic carrying capacity. The presence of a wrap-
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around zipper may be an indication that the container is a carry-all if the zipper creates an inner space suitable for carrying three-dimensional objects.
It is asserted that the classification of the subject items should conform to the classification of the flatgoods subject to Headquarters Ruling Letters (HQ) 957630, issued March 24, 1995, and to HQ 953774, issued August 2, 1993. We do not agree. Although the sample subject to HQ 957630 featured a detachable shoulder strap and was said, at one point, to be capable of holding “small objects such as keys,” the article’s approximate measurements were only 3-1/2 inches by 4-3/4 inches by 1-1/2 inch, and, unlike both items PLDFN 9520 and R8153, the presence of gusseted pockets, if any, was not noted. It was found that the article did not possess sufficient capacity to hold the small personal effects typically carried in a handbag (e.g., hairbrush, keys on a chain, certain cosmetics) and did not have the character of a carry-all container.
The two flatgoods classified in HQ 953774 were each said to measure approximately 7-1/4 inches by 4 inches, and to possess a gusset which expanded from a thickness of approximately 1 inch to 1-3/4 inch. We noted that the articles featured compartments specially fitted to hold such items as paper money, credit cards, photographs, change, and check books, and that “they are relatively flat, as they cannot be expanded to a width greater than 1 3/4 inches.” It was ultimately found that the compartments were not as large as those found in a typical handbag, and that they could not accommodate items often placed in handbags such as a hairbrush, certain cosmetics, or a set of keys.
With respect to the subject merchandise, we note that both items are fitted to hold credit or i.d. cards, photos, paper currency, and that they are at least capable of being carried
in a handbag. We also find that the articles are designed to hold 3-dimensional items not associated with the capacities of a wallet or flatgood. Each of the items has at least one gusseted pocket, the smallest of which (in the case of item R8153) expands to a width of 3-3/4 inches, providing a generic carrying capacity
for loose personal effects such as a small hairbrush, a set of keys, cosmetics, etc. We thus conclude that items PLDFN 9520 and R8153 are classified as handbags. For additional rulings consistent with this decision, see HQ 960180, issued August 12, 1997, HQ 959185, issued February 10, 1997, and HQ 958644, issued August 29, 1996.
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HOLDING:
The handbags identified by items PLDFN 9520 and R8153 are classified in subheading 4202.22.1500, HTSUSA, the provision for handbags with outer surface of sheeting of plastic. The general column one duty rate is 18.4 percent ad valorem.
No later than 60 days from the date of this letter, the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.ustreas.gov, by means of the Freedom of Information Act, and by other methods of public distribution.
Sincerely,
John Durant, Director
Commercial Rulings Division