CLA-2 OT:RR:CTF:TCM H074995 TNA
Port Director, Los Angeles Service Port
U.S. Customs and Border Protection
11099 South La Cienega Blvd. Los Angeles, CA 90045
Re: Application for Further Review of Protest No: 2720-09-100175; classification gold and silver coins
Dear Port Director:
The following is our decision regarding the Application for Further Review (“AFR”) of Protest No. 2720-09-100175, timely filed on March 11, 2009, on behalf of Panda America Corporation (“Panda”). The AFR concerns the classification of gold and silver coins under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
The subject merchandise consists of gold and silver commemorative coins from Mexico and Australia. In Mexico, these coins are minted by the Mexican Mint and are distributed through the Banco de Mexico. In Australia, the subject coins are issued through the Perth Mint an official Australian mint. Panda is a retail distributor of coins from the Mexican mint and the Perth Mint. Both types of coins are non-circulating legal tender. According to a numismatic dictionary, non-circulating legal tender is “a coin struck by the national issuing authority mainly to be sold to collectors. The coins also have a face value and can be spent in the country of issue.” See http://www.predecimal.com/dictionary.htm. These coins are generally purchased to be collected.
The merchandise was entered on February 28, 2008, under heading 7118, HTSUS, as coins. On November 3, 2008, a notice of action was issued, reclassifying the coins in heading 7114, HTSUS, as “Articles of goldsmiths' or silversmiths' wares and parts thereof, of precious metal or of metal clad with precious metal.” CBP liquidated the entries in heading 7114, HTSUS, on December 5, 2008.
ISSUE:
Whether the subject commemorative coins are classified under heading 7114, HTSUS, as articles of goldsmiths and silversmiths, or under heading 7118, HTSUS, as coins?
LAW AND ANALYSIS:
Initially, we note that the matter protested is protestable under 19 U.S.C. §1514(a)(2) as a decision on classification. The protest was timely filed, within 180 days of liquidation for entries made on or after December 18, 2004. (Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2)(B)(ii), (iii) (codified as amended at 19 U.S.C. § 1514(c)(3) (2006)).
Further Review of Protest No. 2720-09-100175 is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(a) because the decision against which the protest was filed is alleged to be inconsistent with a ruling of the Commissioner of Customs or his designee, or with a decision made at any port with respect to the same or substantially similar merchandise. Specifically, protestant argues that the protested classification is inconsistent with NY N016199, dated September 11, 2007, and NY I81266, dated May 15, 2002.
Merchandise imported into the United States is classified under the HTSUS. Tariff classification is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context which requires otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provisions of law for all purposes.
GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in their appropriate order. GRI 6 requires that the classification of goods in the subheadings of headings shall be determined according to the terms of those subheadings, any related subheading notes and, mutatis mutandis, to GRIs 1 through 5.
The 2008 HTSUS headings under consideration are the following:
7114 Articles of goldsmiths' or silversmiths' wares and parts thereof, of precious metal or of metal clad with precious metal:
Of precious metal whether or not plated or clad with precious metal:
7114.11 Of silver, whether or not plated or clad with other precious metal:
7118 Coin:
7118.90.00 Other
Gold:
In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System (HS), which constitute the official interpretation of the HS at the international level, may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989).
The EN for heading 7114 states, in pertinent part, the following:
This heading covers articles of goldsmiths’ or silversmiths’ wares as defined in Note 10 to this Chapter wholly or partly of precious metal or metal clad with precious metal. In general these goods are larger than articles of jewellery of heading 71.13…
The heading also covers unfinished or incomplete articles of goldsmiths’ or silversmiths’ wares and identifiable parts of goldsmiths’ or silversmiths’ wares, for example, silver handles for tableware, silver backs for toilet brushes, etc.
Like jewellery and subject to the same reservation as regards minor constituents, the goods of this heading must contain precious metal or metal clad with precious metal; they may also contain pearls (natural, cultured or imitation) precious or semi-precious stones (natural, synthetic or reconstructed), imitation stones, tortoise-shell, mother of pearl, ivory, amber (natural or agglomerated), jet or coral.
The EN for heading 7118 states, in pertinent part, the following:
This heading applies to coins of any metal (including precious metals) of officially prescribed weight and design, issued under government control for use as legal tender. Consignments of individual coins or of sets of coins which are legal tender in the country of issue are classified in this heading even if they are put up for general sale in presentation cases. The heading includes coin which is no longer legal tender but it excludes collectors’ pieces (see Explanatory Note to heading 97.05).
Coins are provided for, eo nomine, in heading 7118, HTSUS. As described by the EN to heading 7118, however, the scope of the heading includes coins issued by government control that is legal tender. As such, the subject merchandise’s classification also hinges on whether the coins meet the definition of “legal tender.”
The phrase “legal tender” is not defined in either the tariff headings or the ENs, so CBP is permitted to draw on dictionaries and other lexicographic materials. See, e.g., Lonza v. United States, 46 F.3d. 1098; 1995 U.S. App. LEXIS 1821; 16 Int’l Trade Rep (BNA) 2551. The Oxford English Dictionary defines “legal tender” as “coin or other money, which a creditor is bound by law to accept, when tendered in payment of a debt.” According to Webster’s College Dictionary, “legal tender” is “money that may be legally offered in payment of an obligation and that a creditor must accept.” According to a numismatic dictionary, non-circulating legal tender is “a coin struck by the national issuing authority mainly to be sold to collectors. The coins also have a face value and can be spent in the country of issue.” See http://www.predecimal.com/dictionary. htm.
The subject merchandise consists of commemorative coins. They are issued by government mints in their respective countries and are released through official channels as non-circulating legal tender. See, e.g., http://www.perthmint.com.au/about_us_the_perth_mint.aspx. Therefore, they meet the definition of legal tender. As a result, they are classified in heading 7118, HTSUS, and specifically in subheading 7118.90.00, HTSUS, which provides for “Coin: other.” This is consistent with prior CBP rulings. See, e.g., NY N016199, dated September 11, 2007.
HOLDING:
By application of GRI 1, the gold and silver coins from Australia and Mexico are classified in heading 7118, HTSUS. Specifically, the coins are classified under subheading 7118.90.00, HTSUS, which provides for “coin: other: other.”
You are instructed to ALLOW the protest.
In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP Form 19, to the protestant no later than 60 days from the date of this letter.
Sixty days from the date of the decision, the Office International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division