CLA-2 RR:CR:GC 960996 MMC
Mr. John M. Peterson
Neville, Peterson & Williams
80 Broad Street
New York, New York 10004
RE: "Christmas Magic Mainstreet" table-top musical decoration;
NYRL B88074
Dear Mr. Peterson:
This is in response to your October 1, 1997, letter on
behalf of Target Stores Division of Dayton Hudson, requesting
reconsideration of New York Ruling Letter (NYRL) B88074 dated
August 13, 1997, which classified an article identified as
"Christmas Magic Mainstreet" under subheading 3926.40.0000 of the
Harmonized Tariff Schedule of the United States (HTSUS) which
provides, in pertinent part, for other plastic articles.
FACTS:
The "Christmas Magic Mainstreet" is an electrically-operated
scale model replica of a winter street scene. The article is
composed of a rectangular plastic base measuring approximately 26
inches long and 11 inches wide. A plaque on the front of the
base contains the words "The Magic of Mainstreet." A long oval
chain-operated track powered by an AC electric motor and an
electronic music box which plays 12 different Christmas songs are
contained within the base. On top of the base are openings for
motorized track pegs on which plastic figurines are placed,
openings with electrical contacts for the insertion of figurines
along the front of the base and several slots and openings for
the insertion of scale-model buildings, figurines and trees.
Among the scenes depicted are the selling of Christmas trees,
street lamps with holiday wreaths, strung Christmas lights, a
sleigh, roasted chestnuts, buildings festooned with wreaths and
Christmas decorations, carolers, a May Pole and a depiction of
Santa Claus.
When electrically activated, the lights in the street lamps
and strung lights illuminate the decoration. The sleigh
(attached to the chain) appears to be pulled by a horse. The
Santa Claus figure appears from behind the shuttered windows of a
building. The May Pole rotates while the music box plays a
variety of Christmas carols. The following statements appear on
the box in which the article is sold:
Holiday spirit brings this tiny Christmas village to life!
Each animated character in the Magic of Mainstreet has been
carefully designed to represent the warm and special
feelings of an old town Christmas! One mode animates
Mainstreet with constant motion and music; another plays a
Christmas melody every other minute as the sleight passes
by.
The article is designed to be placed on a table-top or counter
and serve as a decoration. According to the importer, it sells
the articles seasonally in its Department 51 "Trim the Tree
Shop."
ISSUE:
Whether "Christmas Magic Mainstreet" is classifiable as a
festive article.
LAW AND ANALYSIS:
In Midwest of Cannon Falls, Inc. v. United States, Court No.
92-03-00206, 1996 Ct. Int'l Trade LEXIS 15 (Ct. Int'l. Trade,
January 18, 1996), and Court No. 96-1271, 96-1279, 1997 U.S. App.
LEXIS 21617 (Fed. Cir. August 14, 1997) (hereinafter Midwest),
the Court addressed the scope of heading 9505, HTSUS,
specifically, the class or kind "festive articles." It then
applied its conclusions to 29 specific articles to determine
whether they were included within the scope of the class "festive
articles." According to the court, all of the articles were
classifiable as "festive." This application provided new
guidelines for the classification of "festive articles." In
general, merchandise is classifiable in heading 9505, HTSUS, as a
"festive article" when the article, as a whole:
1. Is not predominately of precious or semiprecious stones,
precious metal or metal clad with precious metal;
2. Functions primarily as a decoration or functional item
used in celebration of and for entertainment on a holiday
and
3. Is associated with or used on a particular holiday
Additionally, the Court gave consideration to the general criteria
for classification set forth in United States v. Carborundum Company,
63 CCPA 98, C.A.D. 1172, 536 F. 2d 373 (1976), cert. denied, 429 U.S.
979 (hereinafter Carborundum). Therefore, for those articles
involving holidays, and symbols not specifically recognized in
Midwest, in addition to the above criteria, Customs will consider the
general criteria set forth in Carborundum in determining whether the
particular article is of a class or kind of good known as "festive
articles." Those criteria include: the general physical
characteristics of the article, the expectation of the ultimate
purchaser, channels of trade, environment of sale (accompanying
accessories, manner of advertisement and display), use in the same
manner as merchandise which defines the class, economic practicality
of so using the import, and recognition in the trade of this use.
The "Christmas Magic Mainstreet" has no precious or semi-precious stones, metals or metal clad with precious metal. It
functions primarily as a decoration used in celebration of and for
entertainment for a particular holiday; Christmas.
Customs has always recognized Christmas as a festive holiday for
tariff purposes. Furthermore, we recognize that table-top mechanical
and musical decorations are, in general, articles which may be of a
class or kind of decoration considered a "festive article" for tariff
purposes. Application of the Carborundum factors will determine
whether a particular table-top mechanical and musical decoration
belongs to the class.
Application of the Carborundum factors to this particular table-top mechanical and musical decoration indicates that the "Christmas
Magic Mainstreet" falls within the scope of the class, "festive
articles." The physical appearance of the decoration, namely its
wreaths, carolers, songs and Santa Claus indicate its use with the
Christmas holiday. Furthermore, both the environment of sale, in a
"Tree Trimming Shop" together with the various statements on the box
in which it is sold, create an expectation for the ultimate purchaser
that the decoration is used only during the Christmas season.
Finally, it is used in the same manner as merchandise which defines
the class, in that it is a decoration which incorporates various
symbols of a recognized holiday season.
Based on this analysis, Customs is of the opinion that the
expectation of the ultimate purchaser, environment of sale, use in
the same manner as merchandise which defines the class and
recognition in the trade of this use, all indicate that the
"Christmas Magic Mainstreet" is principally used as a "festive
article." Therefore, it is classifiable under heading 9505,
specifically, subheading 9505.10.25, HTSUS, as "Festive, carnival or
other entertainment articles, including magic tricks and practical
joke articles; parts and accessories thereof: [c]hristmas ornaments:
[o]ther."
Section 152.16 of the Customs Regulations (19 CFR 152.16),
states, in pertinent part, that:
152.16 Judicial changes in classification
The following procedures apply to changes in classification made
by decisions of either the United States Court of International
Trade or the United States Court of Appeals for the Federal
Circuit...:
(a) * * *
(b) * * *
(c) * * *
(d) * * *
(e) Other decisions adverse to Government. Unless the
Commissioner of Customs otherwise directs, the principles
of any court decision adverse to the Government...shall be
applied to unliquidated entries and protested entries which
have not been denied in whole or in part and in which the
same issue is involved as soon as the time within which an
application for a rehearing or review may be filed has
expired without such application having been made.
As the judicial decision in Midwest was adverse to the government,
and had a direct effect on the classification of merchandise which
was the subject of NYRL B88074, that ruling was effectively revoked
by Midwest. Since NYRL B88074 has already been effectively revoked
by judicial decision, this is not a proposed interpretative ruling or
decision which would require publication in the Customs Bulletin
under 19 U.S.C. 1625(c). Rather, this letter is a new, prospective
ruling which applies the findings in Midwest to the merchandise ruled
upon in NYRL B88074. As such it governs any unliquidated or
protested entries to which Midwest applies.
HOLDING:
The "Christmas Magic Mainstreet" is classifiable under
subheading 9505.10.25, HTSUS, as "Festive, carnival or other
entertainment articles, including magic tricks and practical joke
articles; parts and accessories thereof: [c]hristmas ornaments:
[o]ther." The applicable rate of duty is free.
Since NYRL B88074 has already been effectively revoked by
judicial decision, this is not a proposed interpretative ruling or
decision which would require publication in the Customs Bulletin
under 19 U.S.C. 1625(c). Rather, this letter is a new, prospective
ruling which applies the findings in Midwest to the merchandise ruled
upon in NYRL B88074. As such it governs any unliquidated or
protested entries to which Midwest applies.
Sincerely,
John Durant, Director Commercial Rulings Division