CLA-2 RR:CR:TE 962243 GGD
Joel K. Simon, Esquire
Serko & Simon
1 World Trade Center, Suite 3371
New York, New York 10048
RE: Revocation of Headquarters Ruling Letter (HQ) 961357;
Portable, Soft-Sided, Insulated Cooler Bags; SGI,
Incorporated v. United States, 122 F.3d 1468 (Fed. Cir.
1997); Outer Layer of Fabric-backed, Compact Plastics
Dear Mr. Simon:
In Headquarters Ruling Letter (HQ) 961357, issued to you June 18, 1998, on behalf of La Rue Distributors, Inc., Customs classified a soft-sided, insulated cooler bag in subheading 3924.10.50, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), the provision for “Tableware, kitchenware, other household articles...of plastics: Tableware and kitchenware: Other.” We have reviewed that ruling and have found it to be in error. Therefore, this ruling revokes HQ 961357.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625(c)(1)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed revocation of HQ 961357, was published on February 3, 1999, in the Customs Bulletin, Volume 33, Number 5.
FACTS:
In your initial request for a binding ruling, dated January 27, 1998, the two samples at issue were described, in pertinent part, as portable, vinyl, soft-sided, insulated cooler bags. Subsequent to the issuance of HQ 961357, it was determined that
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the vinyl outer surface of each bag actually comprised the outward facing surface of a layer composed of a textile fabric that had been coated, covered or laminated with vinyl, a non-cellular (compact) plastic.
The two samples, identified as styles 2605COW and 2679COW, are insulated bags which are primarily designed to store and preserve food and/or beverages. Both bags are imprinted with designs and logos related to the National Football League, the Dallas Cowboys, and ABC’s television program “Monday Night Football.” Between the fabric-backed, vinyl outer layer and the vinyl inner lining of each bag is a layer of plastic foam insulation material. The bags appear ill-suited to contain melting ice, as they leak at the seams when water is added. Each bag has a nylon web carrying strap.
Style 2605COW measures approximately 10-1/2 inches in height by 7 inches in width by 4-1/4 inches in depth (with gussets fully expanded). The bag has a hook and loop fabric fastener which secures the top flap. Style 2679COW measures approximately 6-1/2 inches in height by 8 inches in width by 6 inches in depth (fully expanded). This bag has a main compartment (which measures approximately 6-1/4 inches in height by 7-1/2 inches in width by 3-3/4 inches in depth) and a smaller, sandwich-sized compartment. Both compartments have zippered closures.
ISSUE:
Whether the insulated cooler bags are classified under heading 3924, HTSUSA, as containers with outer surface of plastics, or under heading 6307, HTSUSA, as other made up (textile) articles with outer surface of fabric-backed compact plastics.
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.
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As noted in HQ 961357, the classification of certain portable, soft-sided, insulated cooler bags with outer surface of plastics, was examined by the Court of Appeals for the Federal
Circuit (CAFC) in SGI, Incorporated v. United States, 122 F.3d 1468 (Fed. Cir. 1997). The CAFC focused on whether food or beverages were involved with the eo nomine exemplars set forth in
the tariff provisions at issue and, without discussion of heading 4202 exemplars that organize, store, protect, and/or carry food or beverages, the CAFC held that the appropriate classification for the cooler bags was subheading 3924.10.50, HTSUS, the provision for “Tableware, kitchenware, other household articles...of plastics: Tableware and kitchenware: Other.” The Court stated that this classification “does encompass exemplars
that are ejusdem generis with the coolers because their purpose is to contain food and beverages.” The exemplars (specifically enumerated in subheading 3924.10.10) which the Court noted in
particular were the “various household containers for foodstuffs such as salt, pepper, mustard, and ketchup dispensers and serving pieces for food.”
This office concluded that the CAFC’s decision in SGI should be implemented. Instructions were issued to Customs field personnel on March 18, 1998, and September 10, 1998 (and approved for dissemination to members of the importing community), by which the principles of the CAFC’s decision were expressly extended to portable, hard or soft-sided, insulated coolers and similar insulated containers (whose primary purpose is to store and preserve food and/or beverages), with outer surface of plastics and with outer surface of textile materials (classified in subheading 6307.90.9905, 6307.90.9907, or 6307.90.9909, HTSUSA, depending upon whether the outer surface is composed of cotton, man-made fibers, or other textile materials, respectively).
The instruction issued on September 10, 1998, expressly extended the principles of the CAFC’s decision to foodstuff-related, insulated containers whose exterior layer is composed of a textile fabric that is coated, covered or laminated with compact plastics, with the plastic surface of the layer facing outward. Such containers are classified in subheading 6307.90.9989, HTSUSA, a provision which is currently not subject to quota/visa requirements. In light of the principles of the SGI decision, the instructions noted above, and the fact that the subject cooler bags each have an outer layer that is composed of fabric-backed compact plastics, styles 2605COW and 2679COW are classified in subheading 6307.90.9989, HTSUSA.
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HOLDING:
The portable, soft-sided, insulated cooler bags identified by styles 2605COW and 2679COW are classified in subheading
6307.90.9989, HTSUSA, the provision for “Other made up [textile]
articles, including dress patterns: Other: Other: Other, Other: Other.” The general column one duty rate is 7 percent ad valorem.
HQ 961357, issued June 18, 1998, is hereby revoked. In accordance with 19 U.S.C. 1625(c)(1), this ruling will become effective 60 days after its publication in the Customs Bulletin.
Sincerely,
John Durant, Director
Commercial Rulings Division