CLA-2 RR:CR:TE 963903 RH
Port Director
U S. Customs
1901 Cross Beam Drive
Charlotte, NC 28217
RE: Tariff Classification of a Folding Carton; Heading 4819; Protest Number
1512-99-100077
Dear Sir:
This is in reply to the Application for Further Review of Protest 1512-99-100077
that you forwarded to our office for review. The law firm of Rode & Qualey timely filed the protest on behalf of CDE Cartondruck U.S.A., Inc., against the liquidation of one entry of paperboard containers imported from Germany.
FACTS:
The merchandise in question is a paperboard container that will be used as a gift box by Coty Inc., a cosmetic company. After importation men’s toiletry products are inserted into the container for retail sale. The container is six sided and measures approximately 7½ inches high when the lid is closed, and approximately 4 inches by 5 inches at the base and top. Flat and folded, it measures 14 inches by 7 inches. It is colored and surface-decorated with the name, picture and weight of the “JOOP” shower gel and eau de toilette. Additionally, the carton has two inserts of the same color that are designed to fit into the carton and hold the shower gel and eau de toilette in place.
Customs classified the carton and inserts as folding cartons under subheading 4819.20.0040 of the Harmonized Tariff Schedule of the United States (HTSUS). The protestant claims that the merchandise is classifiable under subheading 4819.50.4060, HTSUS, as other packing containers.
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At the time of liquidation, merchandise classifiable under subheading 9903.08.10 (affecting articles in subheading 4819.20, HTSUS), was subject to 100 percent ad valorem duties imposed on a list of products of certain member states of the European Community (EC) as a result of the EC’s failure to implement the recommendations and ruling of the World Trade Organization (WTO) Dispute Settlement Body concerning the EC’s regime for the importation, sale and distribution of bananas.
The termination of increased duties is effective with respect to articles entered, or withdrawn from warehouse, for consumption, on or after July 1, 2001, except that the termination of increased duties on subheading 4911.91.2020, HTSUS, is effective with respect to articles entered, or withdrawn from warehouse, for
consumption, on or after March 3, 1999, for which unliquidated entries or entries subject to timely protest are pending before Customs. A copy of the Federal Register notice is attached.
ISSUE:
What is the correct tariff classification of the Cartondruck container and inserts described above?
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 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.
In interpreting the headings and subheadings, Customs looks to the Harmonized Commodity Description and Coding System Explanatory Notes (EN), which are not legally binding, but are recognized as the official interpretation of the Harmonized System at the international level. It is Customs practice to follow, whenever possible, the terms of the EN when interpreting the HTSUS.
Heading 4819 encompasses:
Cartons, boxes, cases, bags and other packing containers, of paper, paperboard, cellulose wadding or webs of cellulose fibers; box files, letter trays, and similar articles, of paper or paperboard of a kind used in offices, shops or the like.
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The EN to the first part of the heading (before the semicolon) covering “Cartons, boxes, cases and other packing containers” reads:
This group covers containers of various kinds and sizes generally used for the packing, transport, storage or sale of merchandise, whether or not also having a decorative value. The heading includes cartons, boxes, cases, bags, cones, packets, casks, paperboard drums (containers), whether manufactured by rolling or by any other method, and whether or not fitted with reinforcing circular bands of other materials, tubular containers for
posting documents, protective garment bags, jars, pots and the like (e.g., for milk or cream), whether or not waxed. The heading also covers special purpose paper bags such as bags for vacuum cleaners, bags for travel sickness, and record boxes and sleeves.
Counsel does not dispute classification of the merchandise at the 4-digit heading level, but argues that it does not fit the description of a folding carton, box or case under subheading 4819.20, HTSUS. The EN to heading 4819 states that folding carton, boxes and cases are:
cartons, boxes and cases in the flat in one piece, for assembly by
folding and slotting (e.g., cake boxes);
and
containers assembled or intended to be assembled by means of glue, staples, etc., on one side only, the construction of the container itself providing the means of forming the other sides, although, where appropriate, additional means of fastening, such as adhesive tape or staples may be used to secure the bottom or lid.
We disagree with counsel that the merchandise cannot be classified as a folding carton, box or case because it has a more complex construction than the “cake box” example in the EN. In our opinion, the carton meets the terms of subheading 4819.20, HTSUS. It is in one piece (single sheet of paperboard) and is imported in a flattened, prefolded or creased condition. It is assembled into a shaped carton by gently pressing the prefolded sides and inserting the slotted tabs into the top, bottom and side of the carton. The carton is used in the storage and sale of merchandise. Moreover, there is no limiting language in the tariff provision or legal notes to preclude classification in subheading 4819.20, HTSUS, where, as in this case, the carton is folded on each end and glued so that when assembled it has two compartments. Accordingly, we find that the Cartondruck container is the type of merchandise covered by the first part of heading 4819, and more specifically, as a folding carton in subheading 4819.20.0040, HTSUS.
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The carton is imported unassembled along with two inserts. GRI 2(a) states that any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as entered, the incomplete or unfinished article has the essential character of the complete or finished article. It shall also include a reference to that article complete or finished (or falling to be classified as complete or finished by virtue of this rule), entered unassembled or disassembled. EN (V) to GRI 2(a), at page 2, states that
The second part of Rule 2(a) provides that complete or finished articles presented unassembled or disassembled are to be classified in the same heading as the assembled article. When goods are so presented, it is usually for reasons such as requirements or convenience of packing, handling or transport.
The inserts are prefolded with tabs to fit perfectly into the carton and to hold the shower gel and eau de toilette in place and are the same color as the carton. The carton and inserts are imported in a flattened condition presumable for convenience of packing, handling or transport. Therefore, in accordance with GRI 2(a), we would classify the unassembled inserts in the same provision as the carton.
The protestant also states that the calculation of the additional duties under
subheading 9903.08.10, HTSUS, was incorrect. The protestant raised the same
issue in a different protest, number 1001-99-105979, which Customs addressed
in Headquarters Ruling Letter (HQ) 547677, dated June 30, 2000. A copy of that
decision is enclosed for your convenience and should be followed in calculating
the value of the instant merchandise.
HOLDING:
The CDE Cartondruck container at issue and the two inserts are classifiable under subheading 4819.20.0040, HTSUS, as an other folding carton of paperboard. Articles classifiable under that tariff provision were subject to 100 percent duty at the time of importation under subheading 9903.08.10, HTSUS, pursuant to temporary trade legislation.
In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you are to mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.
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Sixty days from the date of the decision, 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 other methods of public distribution.
Sincerely,
John Durant, Director
Commercial Rulings Division