CLA-2 R:C:M 958112
Ms. Kelly M. Callahan
Traffic Manager
New Balance Athletic Shoe, Inc.
5 S. Union St.
Lawrence, MA 01841
RE: Footwear; Formed uppers; Parts of footwear; HRL's 955606,
950946
Dear Ms. Callahan:
Your letter dated May 23, 1995, addressed to U.S. Customs,
New York, New York, concerning the tariff classification under
the Harmonized Tariff Schedule of the United States (HTSUS), of
footwear uppers has been referred to this office for a response.
Samples were submitted for examination along with laboratory
reports which detail the material composition of the uppers.
FACTS:
The three samples are identified as Styles M705WN, M705CW
and W705WP. The samples are mesh fabric slip-lasted uppers with
closed bottoms. Over a dozen substantial (imitation leather)
plastic pieces are stitched onto them, basically in the areas
that will be "external" in the finished shoe. These uppers will
be used after importation in the manufacture of athletic
footwear.
ISSUES:
Are any of the styles considered a "formed upper" for tariff
purposes?
What is the constituent material of the uppers?
LAW AND ANALYSIS:
Classification of goods under the HTSUS 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]." In other words, classification is
governed first by the terms of the headings of the tariff and any
relative section or chapter notes.
Footwear is provided for in Chapter 64, HTSUS. Additional
U.S. Note 4 to chapter 64, HTSUS, provides in pertinent part, as
follows:
. . . Provisions for 'formed uppers' covers uppers,
with closed bottoms, which have been shaped by lasting,
molding or otherwise but not by simply closing at the
bottom.
Heading 6406, HTSUS, provides in pertinent part, for parts
of footwear (including uppers whether or not attached to soles
other than outer soles). . . . Uppers and parts thereof, other
than stiffeners are provided for in subheading 6406.10, HTSUS.
Breakouts at the 8 and 10 digit level are determined according to
component material and value.
Style W705WP is clearly not a formed upper noting that it
lies flat on its side in a very unshaped manner. Further, it
appears there was no process performed that was not necessary to
either close the bottom or attach the flexible imitation leather
plastic pieces to each other and or to the mesh slip-lasted
upper.
With respect to styles M705WN and M705CW a significant extra
step is involved: a semi-rigid inside back counter has been
bent, probably by hand, into a curve and stitched at both of its
ends to the large, imitation leather, outside back counter-side
flash-anchor piece. This gives the back of the upper the
rounded, basically semi-circular shape of a shoe, and the step
was clearly not necessary for the "closing" of the bottom since
style W705WP lacks it.
The counters are not quite as fully shaped as the one in the
formed upper which was the subject of Headquarters Ruling Letter
(HRL) 955606 dated May 27, 1994, because they have not yet been
given the curve in the vertical plane that they will almost
certainly get when they are, we presume, softened and bent
further by a back part lasting machine. Thus, they were not
partially shaped by lasting as was the upper in HRL 955606.
However, uppers can be shaped "otherwise" than by lasting or
molding as stated in Additional U.S. Note 4 to Chapter 64, supra.
As implied in HRL 950946 dated June 22, 1992, the presence of a
relatively rigid piece which requires the upper to maintain at
least in part, its imported shape in the finished shoe is a
critical consideration. Although M705WN and M705CW are close
cases, we believe it is more correct to say that they were shaped
otherwise than by a simple closing of the bottom, than the
contrary.
Note 3 to chapter 64, HTSUS, reads, as follows:
3. For the purposes of this chapter, the expression
"rubber or plastics" includes any textile material
visibly coated (or covered) externally with one or both
of those materials.
Note 4(a) to chapter 64, HTSUS, reads, as follows:
4. Subject to note 3 to this chapter:
(a) The material of the upper shall be taken to be the
constituent material having the greatest external
surface area, no account being taken of
accessories or reinforcements such as ankle
patches, edging, ornamentation, buckles, tabs,
eyelet stays or similar attachments[.]
The Harmonized Commodity Description and Coding System
Explanatory Notes to the HTSUS (EN), although not dispositive, or
legally binding, provide a commentary on the scope of each
heading of the HTSUS, and are generally indicative of the proper
interpretation of the HTSUS. See T.D. 89-80, 54 FR 35127, 35128
(August 23, 1989). General EN (D) to chapter 64, HTSUS, which is
relevant here, reads, in pertinent part as follows:
If the upper consists of two or more materials,
classification is determined by the constituent material
which has the greatest external surface area, no account
being taken of accessories or reinforcements such as ankle
patches, protective or ornamental strips or edging, other
ornamentation (e.g., tassels, pompons or braid), buckles,
tabs, eyelet stays, laces or slide fasteners.
According to the independent laboratory reports furnished,
the external surface area of the uppers of each style is slightly
less than 80% rubber/plastics and slightly more than 20% textile.
We do not agree with the laboratory analyses. It is clear to us
that there was a complete mesh upper before any of the imitation
leather plastic pieces were added, not just the "Triangular
Plastic Eyelet Tabs" excluded from the laboratory measurement.
Thus, we consider the upper exclusive of accessories and
reinforcements (A-R) to be 100% textile materials (TM), not in
the low twenties, as found. However, it is obvious that when
all the plastic A-R's, including the Eyelet Tabs excluded from
the laboratory's measurement, are included for the purposes of
the U.S. break-outs, that the external surface is far less than
50% TM. See note 4(a) to Chapter 64, supra.
HOLDING:
Style W705WP is an unformed upper classifiable under
subheading 6406.10.85, HTSUS, 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, uppers of which less than 50 percent of
the external surface area (including any leather, rubber or
plastics accessories or reinforcements such as mentioned in note
4(a) to this chapter) is textile materials. The applicable rate
of duty for this provision is 8.6% ad valorem.
Styles M705WN and M705CW are formed uppers classifiable
under subheading 6406.10.35, HTSUS, 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, formed uppers of textile materials, other, valued
over $6.50 but not over $12/pair. The applicable rate of duty
for this provision is 84.4 cents per pair plus 18.7% ad valorem.
Sincerely,
John Durant, Director
Commercial Rulings Division