CLA-2 RR:CR:TE 959511 GGD
Port Director
U.S. Customs Service
300 South Ferry Street
Terminal Island, California 90731
RE: Withdrawal of Application for Further Review; Protest No.
2704-96-101883 Denied; Protest Issues Treated as Internal
Advice Request Concerning Classification of Wallets or Small
Handbags
Dear Sir:
By letter dated November 17, 1998 (copy attached), an Application for Further Review (AFR) of the protest referenced above was withdrawn. The protest should therefore be denied. Despite the withdrawal of the AFR and the denial of the protest, however, there remain substantial issues, the discussion of which may benefit Customs field personnel and the importing community. We therefore consider this letter to be a response to an Internal Advice Request made pursuant to 19 CFR 177.11(a), concerning the issues raised by the protestant.
FACTS:
The sample article, identified as item Y9434, has an outer surface composed of leather. The item measures approximately 4-1/4 inches in height in the closed position (9 inches when open) by 7-1/2 inches in width by 1-1/4 inch in depth. The article is a bifold container with a detachable shoulder strap and a snap closure. Its rear exterior has one full-width open pocket. The front exterior features a large, full-width, gusseted spectacle case, behind which is a full-width zippered flat pocket. The item’s interior features a transparent flat slot pocket for an identification card, a sealed slot pocket with a mirror (which
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measures approximately 2-3/4 inches by 1-5/8 inch), a full-width flat pocket behind these, and two elastic loops designed to hold writing instruments. On the opposite interior flap, there are 2 rows of 3 credit card slots, a flat, full-width, open pocket, behind which is a zippered flat, full-width pocket. Behind that pocket is an additional flat, open, full-width pocket.
ISSUE:
Whether the merchandise is properly classified in subheading 4202.31, HTSUS, as an article of a kind normally carried in the pocket or in the handbag; or in subheading 4202.21, HTSUS, as a handbag.
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRI). 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 GRI may then be applied. The Explanatory Notes (EN) to the Harmonized Commodity Description and Coding System, which represent the official interpretation of the tariff at the international level, facilitate classification under the HTSUS by offering guidance in understanding the scope of the headings and GRI.
Among other goods, heading 4202, HTSUS, provides for traveling bags, handbags, wallets, and similar containers. Since the merchandise is similar to a handbag and/or to a wallet, it is covered by the heading.
Subheading 4202.21 (as well as subheadings 4202.22 and 4202.29), HTSUS, covers handbags, whether or not with shoulder strap, including those without handles.
Subheading 4202.31 (as well as subheadings 4202.32 and 4202.39), HTSUS, covers articles of a kind normally carried in the pocket or handbag. The subheading EN to these three subheadings states:
These subheadings cover articles of a kind normally carried in the pocket or in the handbag and include spectacle cases, note-cases (bill-folds), wallets, purses, key-cases, cigarette-cases, cigar-cases, pipe-cases and tobacco-pouches.
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On June 21, 1995, this office published a General Notice in the Customs Bulletin, Volume 29, Number 25, concerning goods identified as “Wallets on a String.” The attributes of both handbags and articles of a kind normally carried in the pocket or in the handbag were discussed. With regard to Articles of a Kind Normally Carried in the Pocket or in the Handbag, the notice stated in pertinent part that:
Such articles include wallets, which may be described as flat cases or containers fitted to hold credit/ identification cards, paper currency, coins and in some instances a checkbook holder. Articles meeting this description which also possess a detachable carrying strap have been classified as flatgoods.
In order to be classifiable as a flatgood, the article must fit comfortably in a handbag or pocket. For example, rectangular or square cases measuring approximately 7-1/2 inches by 4-1/2 inches, or 4-3/4 inches by 4-1/2 inches, in their closed position, have been classified as flatgoods.
Combining the characteristics of two flatgoods does not transform a flatgood into a handbag. Thus, the addition of a spectacle case holder to what is otherwise nothing more than a flat case with a carrying strap has been classified as a flatgood.
With respect to Handbags, the notice stated that:
A handbag functions as a carry-all container for various small personal effects:
A container which is not fitted to hold articles such as credit/identification cards, paper currency, coins or a checkbook holder is classifiable as a handbag. Therefore, a clutch bag or an evening bag measuring, for example, 7-1/2 inches by 4-1/2 inches, shall be classified as a handbag.
The determinative feature of a handbag is its ability to hold several objects not associated with a wallet. A bag which may accommodate articles such as a hairbrush, cosmetics, keys and other loose personal effects shall be classified as a handbag, even if it also incorporates the features of a flat case fitted to hold the items set forth above.
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The presence of gusseted and/or zippered compartments will be taken into consideration in a determination of whether a case has generic carrying capacity. The presence of a wrap-around zipper may be an indication that the container is a carry-all if the zipper creates an inner space suitable for carrying three-dimensional objects.
It is asserted that the classification of the subject article should conform to the classification of the flatgoods subject to Headquarters Ruling Letters (HQ) 957630, issued March 24, 1995, HQ 955550, issued June 15, 1994, and to HQ 953774, issued August 2, 1993. We do not agree. Although the sample subject to HQ 957630 featured a detachable shoulder strap and was said, at one point, to be capable of holding “small objects such as keys,” the article’s approximate measurements were only 3-1/2 inches by 4-3/4 inches by 1-1/2 inch, and, unlike item Y9434, the presence of gusseted pockets, if any, was not noted. It was found that the article did not possess sufficient capacity to hold the small personal effects typically carried in a handbag (e.g., hairbrush, keys on a chain, certain cosmetics) and did not have the character of a carry-all container.
The two flatgoods classified in HQ 953774 were each said to measure approximately 7-1/4 inches by 4 inches, and to possess a gusset which expanded from a thickness of approximately 1 inch to 1-3/4 inch. We noted that the articles featured compartments specially fitted to hold such items as paper money, credit cards, photographs, change, and check books, and that “they are relatively flat, as they cannot be expanded to a width greater than 1 3/4 inches.” It was ultimately found that the compartments were not as large as those found in a typical handbag, and that they could not accommodate items often placed in handbags such as a hairbrush, certain cosmetics, or a set of keys.
Of the four separate articles classified in HQ 955550, two items had features which - like item Y9434 - included a spectacle pouch. With respect to the item classified as a flatgood, we noted that “the addition of a spectacle case holder was a step in the direction of a handbag, as the article begins to take the character of a carry-all container.” The other of the two items, however, was classified as a handbag. In addition to the spectacle case, it featured a retractable make-up mirror and a pen holder. Although it would not accommodate a hairbrush, its three zippered pouches were large enough to hold keys, small cosmetics, tissues, a comb or lipstick, and other small personal
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effects. We concluded that the item had been designed to be used principally as a carrying bag and classified the article in subheading 4202.22.1500, HTSUSA.
With respect to the subject merchandise, we note that item Y9434 is fitted to hold credit or i.d. cards, photos, paper currency, and that it is at least capable of being carried
in a handbag. We also find that the article is designed to hold 3-dimensional items not associated with the capacities of a wallet or flatgood. The item not only has a large gusseted pocket for spectacles, but also, like the handbag subject to HQ 955550 above, features a mirror, two loops for writing instruments, and additional zippered and open pockets that provide a generic carrying capacity for various personal effects such as a small hairbrush, a set of keys, cosmetics, etc. We thus conclude that item Y9434 is classified as a handbag. For additional rulings consistent with this decision, see HQ 960180, issued August 12, 1997, HQ 959185, issued February 10, 1997, and HQ 958644, issued August 29, 1996.
HOLDING:
The handbag identified by item Y9434 is classified in subheading 4202.21.6000, HTSUSA, the provision for handbags with outer surface of leather. The general column one duty rate is 10 percent ad valorem.
No later than 60 days from the date of this letter, the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.ustreas.gov, by means of the Freedom of Information Act, and by other methods of public distribution.
Sincerely,
John Durant, Director
Commercial Rulings Division