CLA-2 RR:CR:GC 966719 KBR
Mr. Larry T. Ordet
Sandler, Travis & Rosenberg, P.A.
The Waterford
5200 Blue Lagoon Drive
Miami, FL 33126-2022
RE: Reconsideration of NY J85027, affirmed; PVC Cosmetic Color Kit
Dear Mr. Ordet:
This is in reference to your letter dated September 2, 2003, on behalf of Wal*Mart Stores, Inc., in which you requested reconsideration of New York Ruling Letter (NY) J85027, dated June 24, 2003, issued by the Customs and Border Protection (“CBP”) National Commodity Specialist Division, New York, concerning the classification of a PVC cosmetic color kit under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). You are asking reconsideration only of the determination of whether the case imported together with the cosmetics qualifies for classification as a “set”. A sample of the PVC cosmetic color kit was submitted for review. Consideration was given to additional information you submitted by e-mail on May 25, 2004. A teleconference was held with you and a representative from your client on May 27, 2004.
FACTS:
The article involved in NY J85027 (June 24, 2003), is a “PVC Cosmetic Color Kit”, stock # 29002. The kit contains an assortment of cosmetics and brushes packaged in a briefcase-like container. The briefcase is composed of polyvinyl chloride (PVC) sheeting, has a handle and two snap closures, and has a lined interior. The cosmetics include: four tubes of lipstick; twenty-four shades of eyeshadow; two bottles of nail polish; four shade of powdered blush; two shades of lip gloss; six cosmetic brushes; two blush brushes; seven foam applicators; a lash/brow comb/brush; and a purse size mirror compact. The cosmetic brushes and mirror are mounted on a removable cardboard insert which attaches with hook-and-loop tape to the top half of the briefcase. The cardboard is covered with the same material as the lining of the briefcase. The cardboard has elastic and PVC pockets sewn onto it to retain the attached objects. The cosmetics, foam applicators and blush brushes are in a removable plastic tray which has fitted places for each of the objects. The plastic tray fits into the bottom half of the briefcase.
NY J85027 determined that because of the PVC briefcase, the article could not be considered a good put up as a set for retail sale and each item must be individually classified. You are asking for reconsideration only of the determination of whether or not the kit is classifiable as a “set,” not the classification of the individual articles.
ISSUE:
Whether the PVC cosmetic color kit constitutes a good put up as a set for retail sale for purposes of tariff classification under the HTSUSA.
LAW AND ANALYSIS:
Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in accordance with the General Rules of Interpretation (GRIs). The systematic detail of the HTSUS 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.
In interpreting the headings and subheadings, CBP looks to the Harmonized Commodity Description and Coding System Explanatory Notes (EN). Although not legally binding nor dispositive, they provide a commentary on the scope of each heading of the HTSUS. It is CBP practice to follow, whenever possible, the terms of the ENs when interpreting the HTSUS. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
As noted above, the cosmetic kit consists of numerous individual components. The kit can not be classified pursuant to GRI 1 because the components are classifiable in different headings. Since no single heading describes all of the products in the cosmetic kit, the components must either be considered as a set under GRI 3(b) or classified individually. The components constitute “goods put up in sets for retail sale,” if they satisfy the following criteria set forth in EN (X) to GRI 3(b). Goods are classified as sets put up for retail sale if they:
(a) consist of at least two different articles which are, prima facie, classifiable in different headings. Therefore, for example, six fondue forks cannot be regarded as a set within the meaning of this Rule;
(b) consist of products or articles put up together to meet a particular need or carry out a specific activity; and
(c) are put up in a manner suitable for sale directly to users without repacking (e.g., in boxes or cases or on boards).
GRI 5 concerns the importation of articles in containers and states:
Camera cases, musical instrument cases, gun cases, drawing instrument cases, necklace cases and similar containers, specially shaped or fitted to contain a specific article or set of articles, suitable for long-term use and entered with the articles for which they are intended, shall be classified with such articles when of a kind normally sold therewith. This rule does not, however, apply to containers which give the whole its essential character;
Subject to the provisions of rule 5(a) above, packing materials and packing containers entered with the goods therein shall be classified with the goods if they are of a kind normally used for packing such goods. However, this provision is not binding when such packing materials or packing containers are clearly suitable for repetitive use.
In this instance, the goods are prima facie classifiable in at least two headings and they are put up in a manner suitable for direct sale. The question is whether the cosmetic kit meets the second criterion requiring the articles to meet a particular need or carry out a specific activity to be classified in accordance with GRI 3(b). The specific activity intended by the merchandise at issue is making oneself up. The cosmetics, applicators, brushes and mirror are used together to perform this activity. A case, holder or container is generally included with the other articles in the set unless the container detracts from the classification as a set. The container should be sufficiently related to the goods contained in it. It should be designed to carry or hold the goods of a set and intended to be used together with the other goods to meet a particular need or carry out a specific activity. Containers that do not satisfy both criteria are generally not classifiable as sets. Further, the burden is on the importer to show how the container is linked. See HQ 957960, dated February 5, 1996 (candies in glass jars); see also Informed Compliance Publication, The Classification of Sets under the HTS, dated September, 1999.
CBP has consistently found that cases containing cosmetics are not classifiable as a GRI 3(b) set. See HQ 953537 (June 16, 1993), HQ 964849 (August 4, 2001), HQ 957707 (June 26, 1995). CBP stated in HQ 963593 (October 15, 2001) that:
Customs has generally found that cosmetic products imported in substantial, reusable cosmetics bags, do not form composite goods.… In HQ 953537, Customs … stated that the cosmetic products complemented each other but the case was unique in that it served to collect, organize, transport and store not only the cosmetic components with which it was entered, but other items such as jewelry and hairwear. The case’s dissimilarity from the other components and the presence of additional compartments demonstrated that the cosmetic products and container were not mutually complementary and not adapted to be used to [sic] together. Customs also found that the components were of a kind normally offered for sale separately. See also HQ 960009, dated October 16, 1997 (travel pouches of a kind sold at retail on their own merits as travel or toiletry bags and not of a kind normally used in the packaging of toiletries/cosmetics). Applying this rationale to the instant case, the cosmetics bag and cosmetic products do not constitute a composite good.
In an e-mail dated May 25, 2004, you cited four rulings as supporting your position: NY 891476 (November 1, 1993); NY 875943 (July 16, 1992); NY 894542 (March 4, 1994); and NY J85069 (June 17, 2003). First we note that the description of the articles in the first three of the rulings is not very detailed. However, in each of these rulings the container seems much less substantial than the instant briefcase. Those three rulings describe the container as merely a “fitted case”, a “case”, “plastic fitted case”, respectively. The last ruling you cite, NY J85069, describes the containers as “Compacts shaped as a Compact Disk Player, Cell Phone and Pager.” The compacts are “designed to house the cosmetics.” First, a compact is a usual container for cosmetics. Second, these compacts appear to be specifically designed to hold the involved cosmetics. Third, the compacts do not appear to be reusable for storing or organizing other types of goods. These three factors are not the case with the instant briefcase. Because the facts involved in these four rulings are substantially different than that of the instant article, we do not find the four rulings you cite dispositive.
In the teleconference on May 27, 2004, you referred to NY G80720 (September 8, 2000), as strongly supporting your position that the briefcase should not stop the classification of the cosmetic kit as a GRI 3(b) set. In NY G80720, two of the samples involved cosmetic sets which included “a rectangular, hard plastic, mirrored case with a clasp closure.” First, we note that the facts involved in NY G80720 are not very detailed, making it hard to determine exactly what the case was like in that instance. Second, the mirrored case in NY G80720 does not seem as substantial, reuseable and useful for other purposes as the instant briefcase. Third, because the case in NY G80720 has an attached mirror, it is, arguably, also related to the specific activity of putting on makeup.
Like the containers in HQ 953537, HQ 964849, HQ 957707 and HQ 963593, the instant briefcase is dissimilar to the other components of the cosmetic kit. The briefcase should last past the use of the cosmetics. The briefcase is reusable and may be used to carry, organize and secure numerous items. The plastic tray holding the cosmetics is easily removed by just lifting it out. The top portion is not specifically designed to only hold the existing articles it contains but can be reused to hold other types of articles in the elastic and pockets. Further, the top is also made so that it may be removed if it is not wanted. The briefcase could easily be used to hold jewelry, tools, paints, writer’s implements and other goods. Therefore, we find that the subject briefcase fails to meet the second criterion of GRI 3(b) for sets.
In the alternative, when GRI 3 does not apply for a container, CBP will consider GRI 5 to classify a container with the article it contains. In HQ 963119 (January 29, 2001), CBP found that a toiletry bag neither qualified as a GRI 3(b) set nor as a GRI 5 container for classification along with the goods it contained, stating:
In HQ 959265, dated April 9, 1999, Customs declined to classify a toiletry bag imported with lotions and cleansers as a set under GRI 3(b). Noting that the bag was twice as large as would be necessary to hold the toiletries, Customs found that the toiletry case did not sufficiently relate to the other goods to form a set. Customs explained that the bag provided an incentive to purchase the toiletries which was independent of its use with them. Finding an insufficient nexus between the bag and the toiletries to form a set put up for retail sale, Customs classified the items separately. Although the instant case is distinguishable in that the bag is imported with empty containers, we find the rational to be persuasive. The instant bag can clearly be used to carry, organize and secure numerous items, including non-toiletry items such as jewelry and lingerie. Due to the ability to carry and organize a large number and broad range of goods, the instant travel bag does not sufficiently relate to the plastic containers for toilet items so that a particular need or specific activity can be identified. Thus, the items are classified separately. Lastly, we note that the instant travel bag does not meet the criteria set forth in GRI 5 for classification with the plastic containers. The bag is not specially shaped or fitted so as to contain the specific set of plastic containers nor is it of a kind normally sold therewith. Also, the bag is not of a kind normally used for packing travel kits and it is clearly suitable for repetitive use.
Looking at the requirements of GRI 5 for the instant article we find that the briefcase in the instant cosmetic kit is not specifically shaped to hold the cosmetics. It is simply a rectangular briefcase. The plastic tray is made to lift out of the briefcase. The cardboard insert holding the brush components is only attached by hook-and-loop tape and also may be easily removed from the case. Further, many types of articles may be held by the elastic and pockets on the cardboard insert. Cosmetics are normally sold separately, in compacts, in plastic trays and in cardboard boxes. Therefore, the briefcase does not meet the requirements of GRI 5(a). The instant briefcase is constructed such that it will last longer than the cosmetics involved and is suitable for reuse to carry, organize and secure numerous other types of items. Therefore, the briefcase also does not meet the requirements of GRI 5(b). Since neither GRI 3(b) nor GRI 5 apply for classifying the briefcase and cosmetics of the PVC cosmetic color kit, the individual items must be individually classified.
HOLDING:
In accordance with the above analysis, each of the articles of the PVC cosmetic color kit, Vendor Stock #29002, must be individually classified under the HTSUSA. The PVC briefcase is classified in subheading 4202.12.2035, HTSUSA, as attache cases, briefcases, and similar containers, with outer surface of plastics, attache cases, briefcases and other similar containers. The 2004 column one, general rate of duty is 20% ad valorum. Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at www.usitc.gov.
EFFECT ON OTHER RULINGS:
NY J85027 is affirmed.
Sincerely,
Myles B. Harmon, Director
Commercial Rulings Division