CLA-2 CO:R:C:M 957053 MMC
District Director
U.S. Customs Service
555 Battery Street
San Francisco, CA 94111
RE: PRD 2809-94-100641; Gold necklaces; Gold earrings; GRI 1, 2(b),
3(a),3(b); EN Rule 3(b)(X)
Dear District Director:
The following is our decision regarding Protest 2809-94-100641
concerning your action in classifying and assessing duty on gold
necklaces and gold earrings under the Harmonized Tariff Schedule of the
United States (HTSUS). Protestant has provided packaging samples,
dealer letters, pictures of the jewelry on display, as well as a felt
board for our review.
FACTS:
The subject articles are described as various pieces of 24 carat
handcrafted gold necklaces and earrings. According to protestant, the
motifs of individual necklaces match the motif of individual pairs of
earrings, thus creating "sets" of jewelry.
According to Customs inspectors, the earrings and necklaces were
imported "just all mixed together in one box". An importer's premises
visitor report indicated that protestant "showed us examples of the
necklace sets which were allegedly in the identical condition in which
they were imported. The sets consisted of gold necklaces and matching
gold earrings with simulated colored stones, each wrapped in cotton
packing material covered with tissue paper. The jewelry we examined
was packaged differently than the parcels which Customs inspectors
viewed on prior shipments."
Pictures, samples and dealer letters indicate that one pair of
earrings and one necklace are displayed together on a felt board.
Additionally, dealer letters indicate that the necklaces and earrings
are sold together.
All of the jewelry was entered under subheading 7113.19.29, HTSUS,
which provides for necklaces of precious metal because the importer
believed the necklaces and earrings met the tariff requirements for
sets put up for retail sale. However, the necklaces were classified
upon liquidation under subheading 7113.19.29, HTSUS, as necklaces and
the earrings were classified under subheading 7112.19.50, HTSUS, which
provides for other articles of jewelry made of precious metal. A
protest was timely filed on May 9, 1994, for all but two of the subject
entries.
Protests against decisions of the appropriate Customs officers
must be in conformity with applicable statutory and regulatory
requirements. The statute, 19 U.S.C. 1514(c)(2) provides, in pertinent
part, that a protest shall be filed "within ninety days after but not
before notice of liquidation... (emphasis added)." The time period for
filing a protest is clearly stated in section 174.12(e), Customs
Regulations (19 CFR 174.12(e)), which reads, in pertinent part, as
follows:
(e) Time of filing.
Protests shall be filed, in accordance with section 514, Tariff
Act of 1930, as amended (19 U.S.C. 1514), within 90 days after
either:
(1) The date of notice of liquidation or reliquidation in
accordance with sections 159.9 or 159.10 of this chapter....
Pursuant to 19 U.S.C. 1514(c)(2) and 19 CFR 174.12(e), the
following entries were not timely protested within 90 days from the
date of notice of liquidation.
ENTRY LIQUIDATED
2801-M14-0024203 1/7/94
2801-M14-0024244 1/14/94
The above entries were not protested until May 9, 1994. The time
period which elapsed between the date of the notice of liquidation and
the date of the filing of the protest is greater than the 90-day period
allowed for the filing of the protest. Therefore, as this protest for
the above entries is not timely filed, it must be denied.
ISSUE:
Are the necklace and earrings classifiable as a set put up for
retail sale under the HTSUS?
LAW AND ANALYSIS:
The classification of merchandise under the HTSUS is governed by
the General Rules of Interpretation (GRI's). GRI 1, HTSUS, states in
part that for legal purposes, classification shall be determined
according to the terms of the headings and any relative section or
chapter notes. Chapter 71, HTSUS, provides for natural or cultured
pearls, precious or semiprecious stones, precious metals, metal clad
with precious metal, and articles thereof; imitation jewelry; coin.
Heading 7113, HTSUS, provides for articles of jewelry and parts
thereof, of precious metal or of metal clad with precious metal.
The subheadings under consideration are:
7113.19.29 articles of jewelry and parts thereof, of precious metal
or of metal clad with precious metal: of other precious
metal, whether or not plated or clad with precious
metal: other: necklaces and neck chains, of gold: other
7113.19.50 articles of jewelry and parts thereof, of precious metal
or of metal clad with precious metal: of other precious
metal, whether or not plated or clad with precious
metal: other: other
GRI 6, HTSUS, provides that for legal purposes, the classification
of goods in the subheadings of a heading shall be determined according
to the terms of those subheadings and any related subheading notes
and,mutatis mutandis, to the above rules, on the understanding that
only subheadings at the same level are comparable. For the purposes of
this rule, the relative section, chapter and subchapter notes also
apply, unless the context otherwise requires. Inasmuch as the subject
articles may be a set, they are described in both of these subheadings,
and therefore, cannot be classified according to GRI 1.
When goods cannot be classified by applying GRI 1, and if the
headings, subheadings and legal notes do not otherwise require, the
remaining GRI's are applied.
GRI 2(b) states, in pertinent part, that any reference in a
heading to a material or substance shall be taken to include a
reference to mixtures or combinations of that material or substance
with other materials or substances. The classification of goods
consisting of more than one material or substance shall be according to
the principles of GRI 3.
GRI 3 states that 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 or to part only of the items in a set put up for
retail sale, 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.
Because each of these subheadings refers to only part of the items in a
possible set put up for retail sale, the subheadings are considered
equally specific and GRI 3(b) must be applied.
GRI 3(b), HTSUS, provides:
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.
To determine what is a "set put up for retail sale" the
Explanatory Notes (ENs) of the Harmonized Commodity Description and
Coding System (HCDCS) may be utilized. EN Rule 3(b)(X) (pg. 4),
provides a three-part test for "goods put up in sets for retail sale":
For the purposes of this Rule, the term 'goods put up in sets for
retail sale' shall be taken to mean goods which:
(a) consist of at least two different articles which are prima
facia, classifiable in different headings....;
(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 repackaging (e.g., in boxes or cases or on boards).
The ENs, although not dispositive, are to be looked to for the proper
interpretation of the HTSUS. See, T.D. 89-80, 54 Fed. Reg. 35127,
35128 (Aug. 23, 1989).
The subject merchandise consists of two different articles, a
necklace and a pair of earrings, which are classified under different
subheadings. Protestant has not provided evidence that persuades us
that the necklaces and earrings are, at the time of importation, sets
put up for retail sale.
Protestant provided no independent evidence that the box displayed
during the importer premises visit was in its original condition as
imported, or that the Customs inspector's assertion that the jewelry
was "all mixed together in a box" was incorrect. Additionally, none of
the dealer letters indicate how the jewelry is packaged when the
dealers receive it. Moreover, the dealer's actions of placing the
articles on felt boards indicate that at the time of importation, the
articles are not suitable for sale directly to users without
repackaging. Because neither the Customs inspector nor protestant
indicated that the articles were imported on felt boards, the articles
are considered repackaged, and therefore, are not suitable for sale
directly to users without repackaging. The necklaces and earrings do
not qualify as sets and are classified separately as necklaces and
earrings.
HOLDING:
The protest should be DENIED. The necklaces are classifiable
under subheading 7113.19.29, HTSUS, as gold necklaces. The earrings
are classifiable under subheading 7113.19.50, HTSUS, as other jewelry
of precious metal.
In accordance with section 3A(11)(b) of Customs Directive 099
3550-065, dated August 4, 1993, Subject: Revised Protest Directive,
this decision should be mailed by your office to the protestant no
later than 60 days from the date of this letter. Any reliquidation of
the entry in accordance with this decision must be accomplished prior
to the mailing of the decision. Sixty days from the date of this
decision, the Office of Regulations and Rulings will take steps to make
the decision available to Customs personnel via the Customs Rulings
Module in ACS and to the public via the Diskette Subscription Service,
Freedom of Information Act and other public access channels.
Sincerely,
John Durant, Director
Commercial Rulings Division