HQ 955541
May 18 1994
CLA-2 CO:R:C:M 955541 DFC
James F. O'Hara, Esq.
Stein, Shostak, Shostak & O'Hara
3580 Wilshire Boulevard
Los Angeles, California 90010-2597
RE: Footwear, athletic, w/removable liners; Liners removable;
Sets; Composite goods; Essential character; External
surface area; T.D. 84-59; HRL's 955705, 952170, 086055,
953219, 953452
Dear Mr. O'Hara:
This is in reference to an inquiry dated December 14, 1993,
on behalf of addidas U.S.A., Inc., concerning the tariff
classification under the Harmonized Tariff Schedule of the United
States Annotated (HTSUSA), of an athletic shoe with a removable
liner. Samples were submitted for examination.
FACTS:
The sample submitted, article 074192, is a man's basketball
[athletic] shoe consisting of a lace-up "frame" and a removable
liner. This shoe "frame" has a unit-molded plastic sole and a
plastic upper. The sole overlaps all of the perimeter of the
upper by 1/4 inch or more and therefore, the shoe has a foxing-
like band. The "frame" upper has six cutouts through which the
liner is visible. The two cutouts at the instep and its lateral
equivalent each have their top and bottom edges joined by three
7/16 inch wide textile strips. There is a plastic pull loop that
rises above the back of the "frame." In place of eyelet stays
and eyelets, there are narrow metal rods which pass through the
upper and create eyelets through which the shoe will be laced.
Attached at the front of the upper by two elastic textile strips
on each side in part of the space that would normally contain the
tongue is a plastic oval made from the same material as the rest
of the upper. Below this oval is another open area through which
the liner is visible.
The liner is a slip-on, over-the-ankle bootie with an upper
made of a textile-plastic foam-textile sandwich. It has an
applied plastic sole which is molded with a tread which makes the
bootie suitable for (limited) wear as footwear without the frame.
Inasmuch as the "frame" does not have a lining, it cannot be worn
without the removable liner. We have been informed that in
normal use, the liner will remain in the frame when the wearer
removes his foot from the shoe. When the liner is removed from
the shoe for washing or any other reason, it will most likely be
reinserted into the frame before the wearer places his foot in
the liner because of the great difficulty in inserting the liner
into the frame while on the foot of the wearer.
ISSUES:
1. What constitutes the external surface area of the upper
(ESAU) of each shoe "frame" and each complete shoe?
2. What is the classification of the shoe "frames"
imported without liners?
3. What is the classification of the liners imported
without "frames"?
4. What is the classification of one complete pair of
shoes, (i.e., one pair of shoe "frames" imported with
one corresponding pair of liners)?
5. What is the classification of one pair of shoe "frames"
imported with two or more pairs of liners?
LAW AND ANALYSIS:
Classification of goods under the HTSUSA is governed by the
General Rules of Interpretation (GRI's). GRI 1 provides that
"classification shall be determined according to the terms of the
headings and any relative section or chapter notes, and, provided
such headings or notes do not otherwise require, according to
[the remaining GRI's taken in order]." In other words,
classification is governed first by the terms of the headings of
the tariff and any relative section or chapter notes. GRI 6,
HTSUSA, requires that the GRI's be applied at the subheading
level on the understanding that only subheadings at the same
level are comparable. The GRI's apply in the same manner when
comparing subheadings within a heading.
Issue 1
The "frame," when imported separately, has an ESAU which
consists of all of the visible plastic surface including the
plastic pull loop [tab] and the plastic oval, which we consider
to be the partial equivalent of a tongue, which is not normally
counted as ESAU or as accessories or reinforcements (A/R). See
T.D. 84-59, 18 Cust. Bull. 166 (1984). The ESAU also includes the
six textile strips in the instep and lateral cutouts, and the
visible portions of the metal rods which create the eyelets. It
appears likely, but would require a measurement to be certain
that the ESAU of the "frame" without the liner will be over 90%
plastic. However, whether or not it is over 90% plastics does
not matter because the "frame" has a foxing-like band which would
preclude its classification under subheading 6402.91.40, HTSUSA,
which provides for other footwear with outer soles and uppers of
rubber or plastics, other footwear, covering the ankle, having
uppers of which over 90 percent of the external surface area
(including any accessories or reinforcements such as those
mentioned in note 4(a) to this chapter) is rubber or plastics
except (1) footwear having a foxing or a foxing-like band applied
or molded at the sole and overlapping the upper.
When the "frame" and liner are imported together, the
external surface area of the upper of the complete shoe includes
all of the textile areas where the textile liner is the only
material covering the foot. Again, the plastic oval, which we
consider to be the partial equivalent of a tongue is not counted
as ESAU or as accessories or reinforcements. Further, textile
will be considered the external surface area of the upper in
those areas where it is visible and tactile when the tongue is
removed, the areas where it comes up higher than the leather, and
all the places where it is visible and tactile through cutouts in
the leather. It is clear that the "frame" and liner together
will still have an ESAU of plastic. However, it is equally clear
that the ESAU including A/R will not be over 90% plastic. Again,
whether or not it is over 90% plastics does not matter because
the "frame has a foxing-like band which would preclude its
classification under subheading 6402.91.40, HTSUSA.
Issues 2 & 4
Pairs of shoe "frames" imported separately and valued over
$12 per pair are classifiable under subheading 6402.91.90,
HTSUSA, which provides for other footwear with outer soles and
uppers of rubber or plastics, other footwear, covering the ankle,
other, valued over $12/pair.
A pair of shoe "frames" imported with a pair of liners and
having a combined entered value of over $12 per pair is also
classifiable under subheading 6402.91.90, HTSUSA.
Issue 3
In Headquarters Ruling Letter (HRL) 955705 dated March 1,
1994, Customs ruled that certain removable textile liners,
similar to those in issue, are classifiable under subheading
6406.10.9040, HTSUSA, which provides for parts of footwear,
uppers and parts thereof, other than stiffeners, other, other, of
textile materials other than cotton, of man-made fibers. The
rationale for our position with respect to the classification of
this type of liner was stated as follows:
For tariff purposes a provision for parts of an article
covers products solely or principally used as a part of
such articles. The shoe "frames" involved are
unfinished or incomplete footwear without the liners.
These liners are designed for use with these shoe
"frames" and are necessary for their completion.
Further, even though the liners are capable of being
worn outside of the shoe, they are designed for and
will be principally used with these shoe "frames.
Consequently, the liner imported separately qualifies
for classification as parts of footwear for tariff
purposes.
The liners or booties which were the subject of HRL's
952170 and 086055 can be distinguished from the instant
liners in that they are used with finished or completed
footwear. Unlike the liners in issue, they are not
necessary to complete the footwear. They are
accessories.
Following the reasoning set forth in HRL 955705, it is our
opinion that the instant liners qualify for classification under
heading 6406, HTSUSA.
It has been suggested that the product is more than "part of
an upper" noting that the liner constitutes not only part of the
shoe's upper but also is a removable sock lining or inner sole.
Further, since the liner functions at all times as a sock lining
(inner sole), its concurrent use as part of the upper cannot be
said to be the sole or principal use. See Additional U.S. Rule
of Interpretation 1(c), HTSUSA. Accordingly, the liners are
classifiable under subheading 6406.99.30, HTSUSA, which provides
for parts of footwear, other, of other materials, of rubber or
plastics.
We disagree with the statement that the product is more than
"part of an upper." It is our view that the merchandise as a
whole is basically a removable liner and its function "as a sock
lining" does not make it more than a "part of an upper" for
tariff purposes.
GRI 2(b), HTSUSA, provides in part that "[t]he
classification of goods consisting of more than one material or
substance shall be according to the principles of Rule 3."
GRI 3, HTSUSA, provides as follows:
3. When, by application of Rule 2(b) or for any other
reason, goods are prima facie classifiable under
two or more headings, classification shall be
effected as follows:
(a) The heading which provides the most specific
description shall be preferred to headings
providing a more general description.
However, when two or more headings each refer
to part only of the materials or substances
contained in mixed or composite goods . . .
those headings are to be regarded as equally
specific in relation to those goods, even if
one of them gives a more complete or precise
description of the goods.
(b) Mixtures, composite goods consisting of
different materials or made up of different
components, and goods put up in sets for
retail sale which cannot be classified by
reference to 3(a), shall be classified as if
they consisted of the material or component
which gives them their essential character,
insofar as this criterion is applicable.
The liners are prima facie classifiable under subheading
6406.10.9040, HTSUSA, which provides for parts of footwear,
(including uppers whether or not attached to soles other than
outer soles), uppers and parts thereof, other than stiffeners,
other, other, of man-made fibers or under subheading
6406.10.6000, HTSUSA, which provides for parts of footwear,
(including uppers whether or not attached to soles other than
outer soles), other, of rubber or plastics.
The Harmonized Commodity Description and Coding System
Explanatory Notes (EN) to the HTSUSA, although not dispositive
should be looked to for the proper interpretation of the HTSUS.
See T.D. 89-80, 54 FR 35127 (August 23, 1989). EN (IX) to GRI
3(b), at page 4, reads as follows:
(IX For the purposes of this Rule, composite
goods made up of different components shall
be taken to mean not only those in which the
components are attached to each other to form
a practically inseparable whole but also
those with separable components, provided
these components are adapted one to the other
and are mutually complementary and that
together they form a whole which would not
normally be offered for sale in separate
parts.
Clearly, the liners which are composed of textile and
plastic qualify as composite goods within the purview of GRI
3(b), HTSUSA. It is our observation that the essential character
of the liner is derived from its textile portion noting that
according to the information provided, it exceeds the plastic
portion in value, weight and surface area. In view of our
finding that the essential character of the article is derived
from its textile portion, classification under subheading
6406.10.9040, HTSUSA, is appropriate.
Even if it were decided that neither component material
could be said to impart the essential character to the
merchandise, classification under subheading 6406.10.9040,
HTSUSA, would be appropriate following GRI 3(c), HTSUSA, which
states that "[w]hen goods cannot be classified by reference to
3(a) or 3(b), they shall be classified under the heading which
occurs last in numerical order among those which equally merit
consideration."
Issue 5
One pair of shoe "frames" imported with two or more pairs of
liners is classifiable as a set under subheading 6402.91.90,
HTSUSA, See Headquarters Ruling Letter (HRL) 953219 dated
February 9, 1993, involving similar merchandise. The shoe liners
are not composite goods with the shoe "frames" because both pairs
of liners cannot be worn at the same time. Therefore, the second
pair of liners would be subject to visa requirements or quota
restraints, if any are in effect. See HRL 953452 dated April 28,
1993.
HOLDING:
Pairs of shoe "frames" imported without liners and valued
over $12 per pair are dutiable at the rate of 20% ad valorem
under subheading 6402.91.90, HTSUSA.
A pair of shoe "frames" imported with a pair of liners and
having a combined entered value of over $12 per pair is also
dutiable at the rate of 20% ad valorem under subheading
6402.91.90, HTSUSA.
Liners imported without "frames" are dutiable at the rate of
9% ad valorem under subheading 6406.10.9040, HTSUS. The textile
category is 669.
One pair of shoe "frames" imported with two or more pairs of
liners is dutiable as a set under subheading 6402.91.90, HTSUSA.
The second pair of liners is subject to visa requirements or
quota restraints, if any are in effect.
Sincerely,
John Durant, Director
Commercial Rulings Division