CLA-2 RR:CR:GC 962965 JRS
Mark S. Davies
Tower Group International, Inc.
4111-A Rose Lake Drive
P.O. Box 19169
Charlotte, NC 28217-9169
RE: Reconsideration of NY A85093; electric light display sculptures of plastic; festive Christmas articles; Heading 9505; Midwest of Cannon Falls v. United States; other Christmas ornaments; Chapter 95, Note 1(t); Primal Lite, Inc. v. United States
Dear Mr. Davies:
This is in response to your letter of May 16, 1999, to the Director, National Commodity Specialist Division, New York, requesting reconsideration of NY A85093, dated July 18, 1996, on behalf of Family Dollar Stores, Inc., concerning the classification under the Harmonized Tariff Schedule of the United States (HTSUS) of four electric light sculptures made in China identified under style #2157PFD.
FACTS:
Each of the four electric light sculptures consists of a decorative plastic frame, illuminated with electrical wiring affixed to the frame. The display measures approximately 34 inches in length. The light sculptures of style #2157PFD depict a "Standing Santa," a "Santa in Sled," a "Xmas Tree" and a "Reindeer." The light sculptures are designed for display outside the home, on a lawn, roof or terrace during the Christmas holidays as decorations.
In NY A85093, Customs classified the four electric light display sculptures under subheading 9405.40.80, HTSUS, which provides for "other electric lamps and lighting fittings." Your assertion is that the appropriate classification is under subheading 9505.10.40, HTSUS, which provides for "other plastic articles for Christmas festivities."
You contend that the light displays are properly classified under Heading 9505 as festive articles in accordance with the Midwest of Cannon Falls court decisions because they are items solely decorative in nature and used only during the holiday season.
ISSUE:
Whether electric light sculptures are classifiable as festive articles under heading 9505 of Chapter 95, HTSUS.
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 GRIs.
Festive, carnival or other entertainment articles are provided for in heading 9505. However, Chapter 95, Note 1(t), HTSUS, specifically excludes "electric garlands of all kinds" from heading 9505 and refers them to classification under heading 9405. Note 1(l) to Chapter 94, HTSUS, states that "[t]his chapter does not cover: ...decorations (other than electric garlands) such as Chinese lanterns (heading 9505)."
Since NY A85093 was issued, the court in Midwest of Cannon Falls, Inc. v. United States, 122 F.3d 1423 (Fed. Cir. 1997)(hereinafter Midwest), ruled on the meaning of festive articles and broadened the term "ornament" as used in heading 9505. The Midwest court found that the term "ornament" should not be confined to objects that hang on a Christmas tree. Prior to Midwest, Customs had classified light sculptures under heading 9405 because light sculptures were not traditionally associated with Christmas festivities and the items were considered to be similar to electric garlands.
Although each decorative sculpture incorporates a string of electric lights around its frame, the light sculpture is not an electric garland. An electric garland is a drapable string of lights or a drapable string of mini light sculptures. See Primal Lite, Inc. v. United States, Slip Op. 98-1562, 1999 U.S. App. LEXIS 16014 (July 16, 1999) aff’g, 15 F. Supp. 2d 915, 22 CIT ___ (1998). Since Customs no longer considers light sculptures to be similar to electric garlands because they are not short lengths of lighting that are capable of hanging on trees, the light sculptures may be classified in heading 9505 if they are found to meet the "class or kind" criteria for festive articles as provided for in Midwest.
In Midwest, the appellate court addressed the scope of heading 9505; specifically the class or kind of merchandise termed, "festive articles," and provided new guidelines for classification of such goods in the heading. In general, merchandise is classifiable as a festive article in heading 9505, when the article, as a whole:
1. Is not predominately of precious or semiprecious stones, precious metal or metal clad with precious metal;
2. Functions primarily as a decoration or functional item used in the celebration of, and entertainment on, a holiday; and
3. Is associated with or used on a particular holiday.
Based upon a review of the articles subject to the Midwest decision, Customs is of the opinion that the Court has included within the scope of "festive articles," decorative household articles which are representations of an accepted symbol for a recognized holiday, and utilitarian/functional articles that are three-dimensional representations of an accepted symbol for a recognized holiday. See Customs’ Informed Compliance Publication (ICP), "Classification of Festive Articles," 32 Customs Bulletin 2/3, dated January 21, 1998.
In the Customs’ ICP, the motifs of Santa Claus, decorated Christmas trees, and Rudolph the Red-nose Reindeer of purely decorative items of subheading 9505.10 are considered "festive." See 32 Customs Bulletin 2/3 at p. 176 ("III. Expanded Interpretation of 9505 Motifs, Symbols or Representations, A. Decorative Items, ‘In 9505.10, Santa Claus, Mrs. Santa Claus, Decorated Christmas Tree, Nativity Scenes, Christmas Stockings and Rudolph the Red-Nose Reindeer’").
In addition to the criteria listed above, the Court considered the general criteria for classification set forth in United States v. Carborundum Company, 63 CCPA 98, C.A.D. 1172, 536 F.2d 373 (1976), cert. denied, 429 U.S. 979. Therefore, with respect to decorative and utilitarian articles related to holidays and symbols not specifically recognized in Midwest or in the ICP, 32 Customs Bulletin 2/3 at p. 178 ("IV. Additional Motifs, Symbols or Representations, B. Utilitarian Items"), Customs will also consider the general criteria set forth in Carborundum to determine whether a particular good belongs to the class or kind “festive articles.” Those criteria include the general physical characteristics of the article, the expectation of the ultimate purchaser, the channels of trade, the environment of sale (accompanying accessories, manner of advertisement and display), the use in the same manner as merchandise which defines the class, economic practicality of so using the import, and recognition in the trade of this use.
In considering the Midwest criteria to the "Standing Santa," a "Santa in Sled," a "Xmas Tree" and a "Reindeer," the light sculptures are not made predominately of precious or semiprecious stones, precious metal or metal clad with precious metal. The ornaments function primarily as outdoor decorations used in the celebration of Christmas, a recognized holiday. Santa Claus and a decorated Christmas tree are accepted symbols for the Christmas holiday. Santa was specifically recognized in Midwest as 16 of the 29 litigated articles were Santa figures. Although the reindeer sculpture may not be "Rudolph the Red-nose Reindeer," Santa’s reindeer are another symbol that raises the possibility of a "festive" classification. See Id. at p. 177 ("IV. Additional Motifs, Symbols or Representations, A. Decorative Items, ‘In 9505.10, Reindeer’"). Here, we find that the reindeer decoration is used in the same manner as merchandise which defines the class of festive articles. The outdoor reindeer decoration is within the class of other decorative Christmas ornaments that are bought, sold and used during the Christmas season, and in the context with the other lighted sculptures can be considered Santa’s reindeer. Therefore, the four light sculptures of style #2157PFD which decorate a lawn or rooftop qualifies as festive articles of heading 9505, specifically subheading 9505.10.25, HTSUS.
HOLDING:
The electric light display sculptures are classifiable in subheading 9505.10.25, HTSUS, the provision for "[f]estive, carnival or other entertainment articles...parts and accessories thereof; [a]rticles for Christmas festivities and part and accessories thereof: [c]hristmas ornaments: [o]ther: [o]ther." NY A85093, dated July 18, 1996, has been revoked by operation of law with the court decision of Midwest of Cannon Falls v. United States.
Sincerely,
John A. Durant, Director
Commercial Rulings Division