CLA-2 RR:CR:GC 962369 JGB
Ms. Jerri Biglow
Marlow & Co., Inc.
P.O Box 90459
Los Angeles, CA 90009
Re: Four-Piece “Stationery” School Accessories Set
Dear Ms. Biglow:
This is in reference to your letter of September 2, 1998, to the Customs National Commodity Specialist Division, New York, on behalf of Level Enterprises, Inc., in which you request a ruling under the Harmonized Tariff Schedule of the United States (HTSUS) on a four-piece “stationery” school accessory set. Your letter was referred to this office for response. We regret the delay in responding.
FACTS:
The set consists of a plastic 6-inch ruler, a plastic pencil sharpener, an eraser and a zippered pouch of Polyvinyl chloride (PVC) sheeting. You indicate in your letter that the pouch is a “plastic pencil bag”; however, no pencils are included. The pouch is flat and measures approximately 8½ inches by 4 inches. The articles are put up for sale together blister packed on a brightly colored cardboard header containing the words “School Accessories.”
ISSUE:
Whether the article is classifiable as a set put up for retail sale or whether the components are classified separately.
LAW AND ANALYSIS:
Merchandise imported into the U.S. is classified under the HTSUS. Tariff classification is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context which otherwise requires, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provisions of law for all purposes. The majority of imported goods are classified by application of GRI 1, that is, according to the terms of the headings of the tariff schedule and any relative section or chapter notes.
The Explanatory Notes (EN's) 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's.
This article cannot be classified by GRI 1, in that no single heading describes all the items. The plastic pouch, if imported separately, would be classified under heading 4202, HTSUS. Heading 4202 provides for:
Trunks, suitcases, vanity cases, attache cases, briefcases, school satchels, spectacle cases, binocular cases, camera cases, musical instrument cases, gun cases, holsters and similar containers; traveling bags, toiletry bags, knapsacks and backpacks, handbags, shopping bags, wallets, purses, map cases, cigarette cases, tobacco pouches, tool bags, sports bags, bottle cases, jewelry boxes, powder cases, cutlery cases and similar containers, of leather or of composition leather, of sheeting of plastics or of textile materials, of vulcanized fiber or of paperboard, or wholly or mainly covered with such materials or with paper.
If imported separately, the eraser would be classified in heading 3926, HTSUS, the provision for other articles of plastics. The pencil sharpener would be classified under heading 8214, HTSUS, the provision for other articles of cutlery. The ruler would be classified under heading 9017, HTSUS, the provision for instruments for measuring length, for use in the hand, among other things.
Under the provisions of GRI 2, “the classification of goods consisting of more than one material or substance shall be according to the principles of rule 3.” GRI 3 provides, in pertinent part, “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:...when two or more headings each refer ... 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.” GRI 3(b) provides that “... 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 ENs to GRI 3(b) state at (X):
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 facie 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 repacking (e.g., in boxes or cases or on boards).
The components in the “stationery” school accessory set are classifiable in different headings and are put up in a manner suitable for sale directly to users. The remaining question is whether they are put up together to meet a particular need or carry out a specific activity. To this end, it is clear that the pouch is designed to contain the other much smaller components. It would be useful to take from room to room in a school, serving to organize and store the components until they are needed. The ruler, eraser, and the sharpener would be awkward or inconvenient to transport by themselves, so the pouch provides a unifying convenience. All the articles are used with a pencil, as the packaging suggests. Supporting the use of a pencil in doing school work is the specific activity for which these articles have been put up for retail sale. Each component could obviously be used alone and usually could be purchased individually. That fact, however, does not invalidate their use together to meet a particular need.
We note in Customs recently published Informed Compliance Publication entitled, “What Every Member of the Trade Community Should Know About: Classification of Sets under the HTS” (ICP) a treatment of the “container as part of the set” concept. The ICP states that “[i]f Customs determines that a holder or container included with other articles is specifically designed to hold or contain those articles, such a determination will support the further conclusion that the articles and the holder or container are intended to be used together, or in conjunction with one another, to meet a particular need or carry out a specific activity.” But “[t]he holder or container need not be form-fitted or otherwise dedicated specifically to holding or carrying the articles imported with it, but it must be a particularly appropriate container and its capacity not appreciably larger than that required to hold or carry the accompanying articles.” ICP, page 9. U.S. Customs, September 1999; distributed via the Customs Electronic Bulletin Board and Customs World Wide Web at http://www.customs.gov. In this instance, the pouch seems well-suited in construction and relative value to its contents and contributes to their usefulness. Consequently, together, the components form a set put up for retail sale.
The ENs to GRI 3(b) at paragraph (VIII) list, as factors to help determine the essential character of sets, the nature of the materials or components, their bulk, quantity, weight or value, and the role of a constituent material in relation to the use of the goods. Recently, there have been several Court decisions on "essential character" for purposes of GRI 3(b). These cases have looked primarily to the role of the constituent materials or components in relation to the use of the goods to determine essential character. See, Better Home Plastics Corp. v. United States, 916 F. Supp. 1265 (CIT 1996), affirmed 119 F.3d 969 (Fed. Cir. 1997); Mita Copystar America, Inc. v. United States, 966 F. Supp. 1245 (CIT 1997), motion for rehearing and reconsideration denied, 994 F. Supp. 393 (CIT 1998), and Vista International Packaging Co., v. United States, 19 CIT 868, 890 F. Supp. 1095 (1995). See also, Pillowtex Corp. v. United States, 983 F. Supp. 188 (CIT 1997), affirmed 171 F.3d 1370 (Fed. Cir. (T) 1999).
Based on the foregoing, we conclude that in an essential character analysis for purposes of GRI 3(b), the role of the constituent materials or components in relation to the use of the goods is generally of primary importance, but the other factors listed in EN Rule 3(b)(VIII) should also be considered, as applicable. In this case, the "indispensable function" (Better Home Plastics, supra) of the set is the convenient grouping, organization and transport of pencil-related objects, making the pouch the component that provides the essential character. It is the pouch that carries and keeps all of the other components together and enhances the usefulness of all the rest of the articles in combination. Insofar as the other factors (quantity, bulk, weight, and value) are concerned, those factors appear to be indeterminate (value is indicated to be the about the same for each component; quantity is the same, and bulk and weight are unknown).
In reaching this conclusion, this office is cognizant of other Headquarters Ruling Letters (HQ) such as HQ 960198, dated May 15, 1997, in which a combination of plastic stationery articles, including pencils, a pencil sharpener, and a ruler contained in a plastic pouch, designed with holes to be carried in a 2 or 3-ringed notebook, were held to be classified in heading 3926, HTSUS, as other articles of plastics. The distinction in the two rulings comes from the manner in which the pouch would be carried. We also note the distinctions made between pencil pouches with binder holes and those designed to be carried in the pocket or handbag that appear in HQ 955660, dated September 27, 1994, which correctly identifies the pouch with binder holes as an article not of Chapter 42, but of Chapter 39, HTSUS.
Within heading 4202, HTSUS, the specific subheading is 4202.92.4500, which provides for travel, sports and similar bags, with outer surface of sheeting of plastics. See, New York Ruling Letter (NY) E87571, dated October 8, 1999, for a similar ruling.
HOLDING:
The four-piece “Stationery” School Accessories Set is classifiable in subheading 4202.92.4500, HTSUS, according to GRI 3(b) which provides that the set will be classified according to the classification of that component that gives the whole its essential character.
Sincerely,
John A. Durant, Director Commercial Rulings Division