CLA-2 CO:R:C:F 954260 ALS
Mr. Gordon C. Anderson
Meyer Customs Brokers
8100 Mitchell Road, Suite 200
Eden Prairie, MN 55344
RE: Child's Fishing Kit
Dear Mr. Anderson:
This is in response to your request of April 30, 1993, to
our New York Seaport Area Office, for a binding ruling on the
Berkley Cub Fishing Kit, a child's fishing kit. Your request and
the sample included therewith were referred to this office for
further consideration.
FACTS:
The article under consideration is a child's fishing kit.
It is made primarily of plastic and consists of a fishing reel
permanently connected to an eleven inch long fishing rod, and a
tackle box which is designed to be attached to the rod for
storage and transport convenience. The tackle box measures
approximately 6 x 3 1/4 x 1 1/2 inches and contains a packet of
five metal hooks, a packet of 3 sinkers, a line bobber, and a
packet of artificial bait. The reel contains a spool holding
about 10 feet of fishing line with a plastic casting plug. The
bait and line are stated to be of U.S. origin and are shipped to
China where the line is cut to size and put on the reel and the
bait packed in a plastic bag. All of the other components are
manufactured in China. The complete kit will be imported from
China in one retail package.
- 2 -
ISSUE:
1. What is the classification of the fishing kit? 2. Are
the U.S. manufactured components which are incorporated in the
kit eligible for duty free treatment under subheading 9801.00.10
or 9802.00.80, Harmonized Tariff Schedule of the United States
Annotated (HTSUSA)? 3. How should the kit be marked for country
of origin purposes?
LAW AND ANALYSIS:
Classification of merchandise under the HTSUSA is governed
by the General Rules of Interpretation (GRI's) taken in order.
GRI 1 provides that the classification is determined first in
accordance with the terms of the headings and any relative
section and chapter notes. If GRI 1 fails to classify the goods
and if the heading and legal notes do not otherwise require, the
remaining GRI's are applied, taken in order.
In considering the classification of the child's fishing kit
we note that no one subheading fully describes the article.
Therefore, the article cannot be classified in accordance with
GRI 1. Since the article is made up of various components which
if imported separately would be classifiable under different
subheadings, we must refer to GRI 3 to classify the kit. In this
regard we note that the individual components are classifiable as
follows: the fishing rod in subheading 9507.10, HTSUSA, the reel
in subheading 9507.30, HTSUSA, and the tackle box and tackle
contents in subheadings 9507.20 and 9507.90, HTSUSA.
GRI 3(a) provides that a composite article such as the
instant kit is to be classified in the heading which provides the
most specific description. Since the description of the various
components is equally specific the kit cannot be classified under
GRI 3(a). Accordingly, we must next consider the classification
of the kit under GRI 3(b) which covers, among other things,
composite goods consisting of different components and goods put
up in sets for retail sale.
Explanatory Note X to GRI 3(b), which represents the opinion
of the international classification experts, provides that
merchandise is a set put up for retail sale if it is composed of:
(a) at least 2 different items classifiable in different headings
(or subheadings); (b) it consists of items put up together to
meet a particular need, (here, specifically, to serve as a
introductory sport fishing device); and (c) it is put up in a - 3 -
manner suitable for sale directly to users without repacking, in
a retail package. Goods classifiable under GRI 3(b) are
classified as if they consisted of the material or component
which gives them their essential character, which may be
determined by the nature of the material or component, its bulk,
quantity, weight or value, or by the role of a constituent
material in relation to the use of the article.
In this regard the inquiry suggests that the reel component
plays the principal role in the use of the article and that it,
therefore, imparts the essential character of the article. The
cost comparison of that component to the other components is
listed as the basis of such suggested classification. While
relative cost is a persuasive factor it is not conclusive. It is
necessary to consider the relationship and significance of the
various components. In this regard we note the role the rod
plays in relation to the use of the article and bulk and quantity
of the fishing tackle box and contents.
In considering all these factors we have concluded that the
various components are equally essential to the kit's performance
of the function for which it was designed. Accordingly, we must
refer to GRI 3(c) which provides that when goods cannot be
classified by reference to GRI 3(a) or (b), they are to be
classified in the heading which occurs last in numerical order
among those which equally merit consideration in determining
their classification.
Accordingly, by virtue of GRI 3(c) the kit would be
classified in the heading which occurs last in numerical order
among those which equally merit consideration, leading us to
subheading 9507.90.8000, HTSUSA.
We next considered whether any of the components are
eligible for duty-free entry under the provisions of chapter 98,
HTSUSA. The U.S. origin artificial bait is eligible for duty-
free entry under subheading 9801.00.10, HTSUSA. The bait is
manufactured in the United States, exported and returned without
having been advanced in value or improved in condition by any
means while abroad. Neither its inclusion in the kit with the
China origin fishing tackle and rod, nor its tariff status as
components of a set precludes its eligibility for duty-free entry
under subheading 9801.00.10, HTSUSA. See T.D. 91-7 ("[C]laims
for Subheading 9801.00.10, HTSUS, treatment for components or
items comprising a portion of imported unassembled articles,
sets, composite goods, and other such combination, shall be - 4 -
granted for those components or items satisfying the conditions
and requirements of this tariff provision.").
Regarding the U.S. origin fishing line exported to China
where the line is cut to size and wound on the reel, subheading
9802.00.80, HTSUSA, provides a partial duty exemption for
articles:
...assembled aboard in whole or in part of fabricated
components, the product of the United States, which
(a) were exported in condition ready for assembly
without further fabrication, (b) have not lost their
physical identity in such articles by change in form,
shape, or otherwise, and (c) have not been advanced in
value or improved in condition abroad except by being
assembled and except by operations incidental to the
assembly process such as cleaning, lubricating and
painting.
Section 10.14(a), Customs Regulations (19 CFR 10.14(a)),
provides, in part, that:
[t]he components must be in condition ready for
assembly without further fabrication at the time of
their exportation from the United States to qualify for
the exemption. Components will not lose their
entitlement to the exemption by being subjected to
operations incidental to the assembly either before,
during, or after their assembly with other components.
Section 10.16(b)(6), Customs Regulations (19 CFR
10.16(b)(6)), states that the cutting to length of wire, thread,
tape, foil, and similar products exported in continuous length is
an example of an operation incidental to the assembly process.
In this case, it appears from the information submitted that
the U.S. line to be sent to China will be entitled to the duty
exemption available under subheading 9802.00.80, HTSUSA, upon
return of the assembled product. The cutting to length of the
fishing line comprising the reel spool is considered an operation
incidental to the assembly process pursuant to section
10.16(b)(6), Customs Regulations. Moreover, fitting the line
component onto the reel spool is an acceptable means of assembly.
See General Instrument corp. v. United States, C.A.D. 1128, 61
CCPA 86, 499 F. 2d 1318(1974) (despooling and winding operations
to form coils constitute assembly steps rather than "further - 5 -
fabrication" within the meaning of the tariff provision), and
Headquarters Ruling Letter (HRL) 555505, dated December 28, 1989,
(abstracted as C.S.D. 90-32(1)) (winding foil and Mylar to form
cylinders for automobile condensers is an acceptable assembly
operation). Thus, duties will be assessed against the full value
of the imported set (excluding the U.S. artificial bait material
discussed above) less the value of the U.S. fabricated line
component, upon compliance with the documentary requirements of
section 10.24, Customs Regulations (19 CFR 10.24).
Section 304 of the Tariff Act of 1930, as amended (19 U.S.C.
1304), provides, subject to specified exceptions, that every
article of foreign origin (or its container) imported into the
U.S. shall be marked in a conspicuous place as legibly, indelibly
and permanently as the nature of the article (or container) will
permit, in such manner as to indicate to the ultimate purchase in
the U.S. the English name of the country of origin of the
article. Neither the statute nor the Customs Regulations
contains any provisions regarding the marking of sets and that in
the absence of any special requirements, the general country of
origin marking requirements apply, i.e., every article that is
imported into the U.S. must be marked to indicate its country of
origin as determined by where the article underwent its last
substantial transformation. See T.D. 91-7. As discussed in T.D.
91-7, the relevant inquiry regarding the marking of the materials
or components in a set is whether the items have been
substantially transformed as a result of their inclusion in the
set. Absent a substantial transformation, each item (or its
container) must be marked to indicate its own country of origin.
In this case, the components of the set include the fishing
reel, the rod and a tackle box. None of these components is
substantially transformed as a result of its inclusion in the
set. As such, we must determine the country of origin of these
various components. Pursuant to 19 CFR 10.22, the country of
origin of the reel is China. (Under this provision, assembled
articles entitled to an exemption under subheading 9802.00.80,
HTSUSA, are considered products of the country of assembly. As
indicated above, the reel, which consists in part of a U.S. line
assembled in China, is so eligible.) Since all the remaining
components (except for the bait which is stated to be of U.S.
origin and thus not subject to the requirements of 19 U.S.C.
1304) are manufactured in China, the country of origin of the rod
and the tackle box would also be China. These items must be
marked to indicate that the country of origin is China.
Alternatively, one origin marking may appear in a central - 6 -
location so long as it is clear that such marking applies to the
whole kit. If the fishing kit is imported and sold in a retail
container and Customs is satisfied that such retail container
will reach the retail purchaser, the retail container may be
marked in lieu of the items in the set.
HOLDING:
A child's fishing kit composed of a rod, a permanently
attached reel, fishing line, tackle and a tackle box, designed to
be attached to the rod for storage and transport convenience,
which contains a packet of hooks, a packet of sinkers, a line
bobber and artificial bait, all primarily of plastic, is
classifiable in subheading 9507.90.8000, HTSUSA, the provision
for fishing rods, fish hooks and other line fishing
tackle;...other: other, including parts and accessories: other.
Articles so classifiable are subject to a general rate of duty of
9 percent ad valorem.
The instant article is subject to duties on the full value
of the imported set (excluding the U.S. artificial bait material)
less the value of the U.S. fabricated line component, upon
compliance with the documentary requirements of section 10.24,
Customs Regulations, in accordance with subheadings 9801.00.1098
and 9802.00.8060, HTSUSA.
The fishing kit must be conspicuously marked "China" as set
forth above.
Sincerely,
John Durant, Director Commercial Rulings Division