CLA-2 OT:RR:CTF:TCM H238478 EGJ
TARIFF NO: 6305.39.00
Port Director
U.S Customs and Border Protection
157 Tradeport Drive
Atlanta, GA 30354
Attn: Sarah Crawford, Import Specialist
RE: Internal Advice Request: Tariff classification of the Aqui-Pak Absorbent Pak
Dear Port Director:
This letter is in reply to your request for Internal Advice, initiated by a letter dated January 11, 2013, by counsel for TheraPak Corp. (TheraPak). At issue is the tariff classification of the Aqui-pak, a textile test tube holder, under the Harmonized Tariff Schedule of the United States (HTSUS). Your request for Internal Advice included a data sheet, a sales ad and a sample of the Aqui-Pak.
FACTS:
The Aqui-Pak is an absorbent test tube holder made of nonwoven textile fabric. The fabric consists of two layers: a layer of nonwoven polypropylene fiber and a layer of absorbent polymer. The two layers are piled together by hot melt adhesive, completing the material. The material is then folded on itself and heat sealed, creating the partitions between each pouch. The Aqui-Pak is then further cut and trimmed by hand to make the finished product. The Aqui-Pak is available in one, two, four and six pouch varieties.
The Aqui-Pak was designed for the safe transport of laboratory specimen tubes, to be used in conjunction with other means of packaging, such as a small shipping container. The Aqui-Pak keeps the specimen tubes separate while providing absorbent cushioning to soak up a spill in the event a tube leaks or breaks during transport. According to the Aqui-Pak sales ad, the merchandise meets the packaging requirements set forth in the U.S. Department of Transportation’s (DOT) Hazardous Materials Regulations. See 49 C.F.R. § 173.
Further, the request states that Aqui-Paks are included in specimen collection kits and, for shipping purposes, can only be used in combination with some other specimen bag, canister or shipping container. The Aqui-Pak, by itself, is not durable enough to withstand the rigors of transportation and cannot be sealed on its own. Pictures of the four and six pouch Aqui-Paks are provided below:
Between July 11, 2012, and August 24, 2012, TheraPak entered the subject merchandise as nonwoven fabric under heading 5603, HTSUS. On October 30, 2012, U.S. Customs and Border Protection (CBP) issued a Notice of Action pursuant to 19 C.F.R. § 152.2, which stated that the Aqui-Pak is classified as a sack or bag under heading 6305, HTSUS. Pursuant to the Notice of Action, TheraPak has remitted the duty owed to CBP and has begun entering the Aqui-Pak under heading 6305, HTSUS, as advised. On January 11, 2013, Therapak submitted a request for Internal Advice to the Port of Atlanta and asserted that the Aqui-Pak is properly classified as a made-up article under heading 6307, HTSUS. See 19 C.F.R. § 177.11.
ISSUE:
Is the Aqui-Pak classified as a bag under heading 6305, HTSUS, or as a made-up article of heading 6307, HTSUS?
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). 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 GRIs 2 through 6 may then be applied in order.
The HTSUS provisions at issue are as follows:
5603 Nonwovens, whether or not impregnated, coated, covered or laminated:
* * *
6305 Sacks and bags, of a kind used for the packing of goods:
* * *
6307 Other made up articles, including dress patterns:
* * *
Additional U.S. Rule of Interpretation 1(a), HTSUS, provides, in relevant part, that:
In the absence of special language or context which otherwise requires:
… a tariff classification controlled by use (other than actual use) is to be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong, and the controlling use is the principal use.
* * *
The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the Harmonized System. While not legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System at the international level and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
EN 63.05 provides, in pertinent part, as follows:
This heading covers textile sacks and bags of a kind normally used for the packing of goods for transport, storage or sale.
These articles, which vary in size and shape, include in particular flexible intermediate bulk containers, coal, grain, flour, potato, coffee or similar sacks, mail bags, and small bags of the kind used for sending samples of merchandise by post. The heading also includes such articles as tea sachets.
Subheading 6305.32
Flexible intermediate bulk containers are usually made of polypropylene or polyethylene woven fabrics and generally have a capacity ranging from 250 kg to 3,000 kg. They may have lifting straps at the four top corners and may be fitted with openings at the top and bottom to facilitate loading and unloading. They are generally used for packing, storage, transport and handling of dry, flowable materials.
* * *
TheraPak agrees with CBP that heading 5603, HTSUS, only covers fabric; it does not cover finished products. Thus, the remaining headings at issue are headings 6305, HTSUS, and 6307, HTSUS. Heading 6305, HTSUS, covers sacks and bags of a kind used for the packing of goods. In The Pomeroy Collection, Ltd. v. United States, 559 F.Supp. 2d 1374, 1394 n. 23 (Ct. Int’l Trade 2008), the Court of International Trade (CIT) described different types of HTSUS provisions as follows:
A “use” provision is “a provision describing articles by the manner in which they are used as opposed to by name,” while an eo nomine provision is one “in which an item is identified by name.” Len-Ron Mfg. Co. v. United States, 334 F.3d 1304, 1308 (Fed. Cir. 2003). And there are two types of "use" provisions -- "actual use" and "principal (formerly known as "chief") use." An "actual use" provision is satisfied only if "such use is intended at the time of importation, the goods are so used and proof thereof is furnished within 3 years after the date the, goods are entered." See Additional U.S Rule of Interpretation ("ARI") 1(b) (quoted in Clarendon Mktg., Inc. v. United States, 144 F.3d 1464, 1467 (Fed. Cir. 1998)). In contrast, a "principal use" provision functions essentially "as a controlling legal label, in the sense, that even if a particular import is proven to be actually used inconsistently with its principal use, the import is nevertheless classified according to its principal use." Clarendon Mktg., 144 F.3d at 1467.
In Primal Lite, Inc. v. United States, 22 C.I.T. 697, 700 (1998), the CIT described one method to identify principal use provisions as follows:
The use of the term "of a kind" is nothing more than a statement of the traditional standard for classifying importation[s] by their use, namely, that it need not necessarily be the actual use of the importation but is the use of the kind of merchandise to which the importation belongs.
Heading 6305, HTSUS, includes the tariff term “of a kind,” which means that it is a principal use provision. Under Additional U.S. Rule of Interpretation 1(a) (AUSR 1(a)), tariff classification under a principal use provision must be determined in accordance with the use in the United States of that class or kind to which the imported goods belong.
Thus, in order to be classified as a sack or bag of a kind used for packing, the Aqui-Pak must belong to the same kind or class of goods as those used for packing. In United States v. Carborundum Co., 536 F.2d 373, 377 (CCPA 1976) (Carborundum), the U.S. Court of Customs and Patent Appeals stated that in order to determine whether an article is included in a particular class or kind of merchandise, the court must consider a variety of factors, including: (1) the general physical characteristics of the merchandise; (2) the channels, class or kind of trade in which the merchandise moves (where the merchandise is sold); (3) the expectation of the ultimate purchasers; (4) the environment of the sale (i.e., accompanying accessories and marketing); (5) usage, if any, in the same manner as merchandise which defines the class; (6) the economic practicality of so using the import; and (7) the recognition in the trade of this use. Id. While these factors were developed under the Tariff Schedule of the United States (predecessor to the HTSUS), the courts have also applied them under the HTSUS. See, e.g. Aromont USA, Inc. v. United States, 671 F.3d 1310 (Fed. Cir. 2012), Essex Manufacturing, Inc. v. United States, 30 C.I.T.1 (2006).
Thus, we must apply the Carborundum factors to the Aqui-Pak to determine if the Aqui-Pak is of the same class or kind of good as goods used for packing. Looking at the Aqui-Pak’s physical characteristics, it consists of an absorbent, non-woven fabric with separate pouches to hold test tubes. In terms of channels of trade, TheraPak’s website states that TheraPak has been “serving the laboratory and pharmaceutical industry since 1999.” TheraPak also sells complete specimen kits and coolers for specimen transportation. According to the sales ad included with the request, Aqui-Pak meets the U.S. DOT’s requirements for packaging of hazardous materials. Namely, the Aqui-Pak consists of an absorbent material that not only separates multiple test tubes to prevent breakage, but also cushions the test tubes within the outer packaging. Aqui-pak is sold together with specimen kits used by laboratories to collect blood, urine and other materials. As such, the ultimate purchasers of Aqui-pak will use it to package test tubes and ship specimens.
CBP has issued numerous rulings which describe and classify bags used for the packing of goods. In Headquarters Ruling Letter (HQ) 958078, dated December 12, 1995, CBP examined textile drawstring bags used to transport experimental seeds. Researchers extracted seeds from experimental plots, placed them in the bags and packed the bags into boxes. The boxes were shipped to research facilities for evaluation. After evaluation, the researchers discarded the textile bags. CBP classified these and similar textile bags for shipping laboratory specimens under heading 6305, HTSUS. See also HQ 960799, dated February 19, 1998 (specimen bags for minerals classified under 6305, HTSUS), HQ 962003, dated August 31, 1999 (specimen bags for minerals classified under 6305, HTSUS), and New York Ruling Letter (NY) F87856, dated June 12, 2000 (rock and soil sample bags classified under 6305, HTSUS).
For all of the aforementioned reasons, we find that the Aquik-Pak is of the same class or kind as bags used for packing goods. Therefore, the Aqui-Pak is classified under heading 6305, HTSUS. As heading 6307, HTSUS, only provides for “other” made up articles which are not classified elsewhere, the Aqui-Pak is not classifiable under heading 6307, HTSUS.
TheraPak asserts that the Aqui-Pak cannot be classified under heading 6305, HTSUS, as the heading does not apply to inner packaging materials. Rather, TheraPak argues that heading 6305, HTSUS, only applies to sacks and bags which are the outermost packaging. TheraPak cites to the list of examples in EN 63.05 to support this argument. The list of examples includes coal, grain, flour, potato, coffee and similar sacks.
We disagree with this argument for several reasons. First, the ENs, the section notes, the chapter notes and the heading text do not mention or make any distinction between inner and outer packaging. Further, EN 63.05 specifically states that tea sachets are covered by the heading. Like the Aqui-Pak, tea sachets are not durable enough to be the outermost packaging for teas, which are primarily sold in tins and boxes. Finally, in rulings such as HQ 958078, CBP has classified bags for laboratory specimens which are packed in boxes and shipped out for evaluation under heading 6305, HTSUS.
Next, TheraPak argues that the Aqui-Pak cannot be classified in heading 6305, HTSUS, because the top of the Aqui-Pak cannot be closed or sealed. TheraPak cites to NY M84946, dated July 17, 2006, as support for this argument. In NY M84946, CBP classified two different styles of pouches used in the medical field for the packaging and sterilization of medical instruments. The two pouches were described as follows:
Product code 201489w is a pouch with the Tyvek side heat-sealed to the clear film along the edges and bottom, with a self-seal adhesive strip on the open end. Product 201539w is tubing, sold in rolls and heat sealed along the two outside edges; the ends do not seal, so it is not considered a bag. The Tyvek side on both products may be printed or unprinted.
CBP classified the first product, which can be sealed, under heading 6305, HTSUS. CBP classified the tubing under heading 6307, HTSUS. However, unlike the argument proffered by TheraPak, CBP could not classify the second product under heading 6305, HTSUS, because it had two open ends, making it a tube. It was not a sack or a bag. Thus, the requirement for sealing as a prerequisite is not set forth in the aforementioned ruling.
In addition to citing NY M84946 for support, TheraPak cites to EN 63.05 and states that all of the listed examples close or seal. However, the requirement that sacks or bags of heading 6305, HTSUS, must seal or close is an inference that the wording of the EN does not support. The flexible intermediate bulk containers described in subheading EN 6305.32 often do not close. See, e.g. NY C88966, dated June 18, 1998 (four bulk container bags with fabric chute openings classified under subheading 6305.32, HTSUS), NY G87494, dated March 15, 2001 (open-ended pack for carrying wool classified under subheading 6305.32, HTSUS), and NY N005192, dated January 29, 2007 (flexible bag with two pouring spouts classified under subheading 6305.32, HTSUS). Further, the section notes, chapter notes and heading text do not mention a sealing requirement.
As such, we are not persuaded by TheraPak’s argument that sacks or bags must seal in order to be classified under heading 6305, HTSUS. The Aqui-Pak cannot be classified as an “other” made-up article of heading 6307, HTSUS, because it is properly classified as a bag of a kind used for packing, under heading 6305, HTSUS.
HOLDING:
By application of GRI 1, the Aqui-Pak is classified under heading 6305, HTSUS. It is specifically classified under subheading 6305.39.00, HTSUS, which provides, in pertinent part, for “Sacks and bags, of a kind used for the packing of goods: Of man-made textile fibers: Other.” The 2014 column one, general rate of duty is 8.4 percent ad valorem.
Duty rates are provided for your convenience and subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the U.S. International Trade Commission’s website at www.usitc.gov.
You are to mail this decision to the Internal Advice requester no later than 60 days from the date of the decision. At that time, the Office of International Trade, Regulations and Rulings, will make the decision available to CBP personnel and the public on the CBP website located 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