CLA-2 RR:CTF:TCM H175960 EGJ
Port Director
U.S. Customs and Border Protection
Los Angeles International Airport
11099 South La Cienega Blvd. Los Angeles, CA 90045
Attn: Charlene Miller, Import Specialist
Re: Application for Further Review of Protest No. 2720-11-100327: Nail Art Stickers
Dear Port Director:
This is in response to Protest 2720-11-100327, dated June 13, 2011, filed by counsel on behalf of Pacific World Corp. (Protestant), in response to your classification of nail art stickers under the Harmonized Tariff Schedule of the United States (HTSUS). In an email dated April 19, 2012, importer’s counsel sent our office a picture of the subject merchandise and asked us to disregard the picture attached to the protest and Application for Further Review (AFR).
FACTS:
The subject merchandise is the Flirt Nail Art Variety Pack (Item No. 02346). It consists of a six different sheets of stickers for application to fingernails and toenails. According to the package, the variety pack contains over 120 stickers. The stickers are in the shape of colorful hearts, stars and flowers. Roughly half of the stickers have a plastic gemstone glued in the center. According to the commercial invoice, the price of the nail art variety pack is 97 cents.
Each sticker consists of one paper layer that is 0.2mm thick covered by one plastic layer that is 0.18 mm thick. The paper is printed with color that shows through the clear plastic layer. A picture of the subject merchandise is provided below:
On May 4, 2010, the subject merchandise was entered under subheading 7117.90.75, HTSUS, which provides for imitation jewelry valued over 20 cents per dozen pieces or parts. On March 18, 2011, CBP liquidated the subject entry under subheading 7117.90.55, HTSUS, which provides for imitation jewelry valued not over 20 cents per dozen pieces or parts.
On June 13, 2011, the Protestant timely filed the subject Protest and AFR. The matter is protestable as a decision on classification. 19 U.S.C. §1514(a)(2). The Protestant’s AFR satisfies application criteria because the Protestant alleges facts which CBP has not previously ruled upon. 19 C.F.R. § 174.24(b). Assuming the merchandise is classified under heading 7117, HTSUS, the Protestant claims that the stickers should be classified using their value per sheet of stickers - not by using their value per individual sticker.
ISSUES:
1. What is the tariff classification of the subject merchandise?
2. If the stickers are classifiable as imitation jewelry under heading 7117, HTSUS, should they be classified at the subheading level based upon their value per sheet of stickers or their value per individual sticker?
LAW AND ANALYSIS:
Merchandise imported into the United States 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 requires otherwise, by the Additional U.S. Rules of Interpretation. GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in their appropriate order.
The HTSUS provisions at issue are as follows:
3919 Self-adhesive plates, sheets, film, foil, tape, strip and other flat shapes, of plastics, whether or not in rolls:
3919.90 Other:
3919.90.50 Other …
* * *
3926 Other articles of plastics and articles of other materials of headings 3901 to 3914:
3926.90 Other:
3926.90.40 Imitation gemstones …
* * *
4823 Other paper, paperboard, cellulose wadding and webs of cellulose fibers, cut to size or shape; other articles of paper pulp, paper, paperboard, cellulose wadding or webs of cellulose fibers:
4823.90 Other:
Other:
4823.90.86 Other …
* * *
7103 Precious stones (other than diamonds) and semi-precious stones, whether or not worked or graded but not strung, mounted or set; ungraded precious stones (other than diamonds) and semi-precious stones, temporarily strung for convenience of transport …
* * *
7113 Articles of jewelry and parts thereof, of precious metal or of metal clad with precious metal …
* * *
7117 Imitation jewelry:
7117.90 Other:
Other:
Valued not over 20 cents per dozen pieces or parts:
7117.90.55 Other …
* * *
Valued over 20 cents per dozen pieces or parts:
Other:
7117.90.75 Of plastics …
* * *
Note 9 to Chapter 71 states as follows:
9. For the purposes of heading 7113, the expression "articles of jewelry" means:
(a) Any small objects of personal adornment (for example, rings, bracelets, necklaces, brooches, earrings, watch chains, fobs, pendants, tie pins, cuff links, dress studs, religious or other medals and insignia); and
(b) Articles of personal use of a kind normally carried in the pocket, in the handbag or on the person (for example, cigar or cigarette cases, snuff boxes, cachou or pill boxes, powder boxes, chain purses or prayer beads).
* * *
Note 11 to Chapter 71 states as follows:
11. For the purposes of heading 7117, the expression "imitation jewelry" means articles of jewelry within the meaning of paragraph (a) of note 9 above (but not including buttons or other articles of heading 9606, or dress combs, hair slides or the like, or hairpins, of heading 9615), not incorporating natural or cultured pearls, precious or semiprecious stones (natural, synthetic or reconstructed) nor (except as plating or as minor constituents) precious metal or metal clad with precious metal.
* * *
The tariff term “imitation jewelry” is defined by Note 9(a) and Note 11 to Chapter 71. Citing to Note 9(a), the Protestant states that the nail stickers are small articles of personal adornment. Citing to Note 11, the Protestant states that the nail stickers do not consist of cultured pearls, precious/semiprecious stones or precious metal. As such, the Protestant states that the nail stickers fall under the definition of imitation jewelry and are classifiable as imitation jewelry under heading 7117, HTSUS.
However, under the rule of ejusdem generis, where an enumeration of specific things is followed by a general word or phrase, the general word or phrase is held to refer to things of the same kind as those specified. With respect to classification analysis, ejusdem generis requires that the imported merchandise possess the essential characteristics or purposes that unite the articles enumerated eo nomine in order to be classified under the general terms. See Sports Graphics, Inc. v. United States, 24 F.3d 1390, 1392 (Fed. Cir. 1994); see also Totes, Inc. v. United States, 18 C.I.T. 919, 923-924 (1994).
As Note 9(a) to Chapter 71 includes the general phrase “for example,” the rule of ejusdem generis must apply to merchandise which is classified using Note 9(a). In HQ H011762, dated April 16, 2008, CBP listed a few essential characteristics of “small articles of personal adornment,” such as being generally lightweight, small in size and primarily decorative. In addition to these characteristics for articles of personal adornment, we cannot read paragraph (a) without the context of the first clause of Note 9. Note 9 begins with “for the purposes of heading 7113, the expression ‘articles of jewelry’ means …” As such, articles of jewelry which are described in paragraph (a) must be classifiable under heading 7113, HTSUS.
Heading 7113, HTSUS, provides for “articles of jewelry and parts thereof, of precious metal or of metal clad with precious metal.” Thus, applying the rule of ejusdem generis, articles of jewelry must consist, at least in part, of precious metal or of metal clad with precious metal. All of the examples of jewelry listed in Note 9(a) to Chapter 71, i.e. rings, bracelets, necklaces, brooches, earrings, etc., include precious metal as a component. Following this definition, imitation jewelry must imitate small articles of personal adornment that consist, in at least in part, of precious metal. (emphasis added).
In order to be classified as imitation jewelry, the subject merchandise must imitate jewelry with precious metal. The subject merchandise consists of nail stickers in the shape of hearts, flowers and stars. There are two types of nail stickers: flat stickers and stickers which include an imitation gemstone. To our knowledge, no article of jewelry consisting of precious metal is designed to lay flat and adhere to fingernails and toenails. As such, the flat stickers are not imitation jewelry; rather, they are imitation nail polish shapes. Similarly, the gemstone stickers imitate nail polish shapes with a precious or semiprecious stone glued to the center. Individual precious and semiprecious stones are classified under heading 7103, HTSUS, not as articles of jewelry under heading 7113, HTSUS.
As the stickers do not imitate jewelry with precious metal, the stickers cannot be classified as imitation jewelry under heading 7117, HTSUS. CBP has classified similar nail stickers in headings other than heading 7117, HTSUS. See, e.g. New York Ruling Letter (NY) 886416, dated June 15, 1993 (nail stickers classified in heading 3919, HTSUS) and NY J89816, dated October 30, 2003 (nail stickers classified in heading 3919, HTSUS).
We now examine the stickers according to their components. The flat stickers consist of a layer of plastics, classifiable in heading 3919, HTSUS, which provides for self-adhesive flat shapes of plastics. The flat stickers also consist of a layer of paper, classifiable in heading 4823, HTSUS, which provides for paper cut to shape. Applying GRI 1, we turn to the relevant section and chapter notes.
Note 2(g) to Chapter 48 states as follows:
2. This chapter does not cover:
(g) Paper-reinforced stratified sheeting of plastics, or one layer of paper or paperboard coated or covered with a layer of plastics, the latter constituting more than half the total thickness, or articles of such materials, other than wallcoverings of heading 4814 (chapter 39) …
In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the Harmonized System at the international level. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989).
The ENs to Chapter 39 state, in pertinent part, the following:
Combinations of plastics and materials other than textiles
This Chapter also covers the following products, whether they have been obtained by a single operation or by a number of successive operations provided that they retain the essential character of articles of plastics:
…
(c) Paper reinforced stratified plastic sheeting, and products consisting of one layer of paper or paperboard coated or covered with a layer of plastics, the latter constituting more than half the total thickness, other than wall coverings of heading 48.14.
For all of the stickers, the plastics layer measures 0.18 mm thick and the paper layer measures 0.20 mm thick. Since the paper layer comprises more than half of the stickers’ total thickness, Note 2(g) to Chapter 48 does not exclude the flat stickers from classification under heading 4823, HTSUS. When we read the ENs to Chapter 39 together with Note 2(g) to Chapter 48, we find that the flat stickers are classifiable under heading 4823, HTSUS, as paper shapes.
Now we must turn to the classification of the nail art stickers which include imitation gemstones of plastic. These imitation gemstones are classifiable under heading 3926, HTSUS, as articles of plastics. We also know that the flat sticker component is classified under heading 4823, HTSUS. As such, the gemstone sticker is a composite good.
GRI 3(b) governs the classification of composite goods and provides that:
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:
Mixtures, composite goods consisting of different materials or made up of different components, and 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.
In order to identify a composite good’s essential character, the U.S. Court of International Trade (CIT) has applied the factors listed in EN VIII to GRI 3(b) which are “the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.” The Home Depot v. United States, 427 F. Supp. 2d 1278, 1293 (Ct. Int’l Trade 2006). With regard to the component which imparts the essential character, the CIT has stated it is “that which is indispensable to the structure, core or condition of the article, i.e. what it is.” Id. citing A.N. Deringer, Inc. v. United States, 66 Cust. Ct. 378, 383 (1971).
Thus, the gemstone stickers are classified under the same heading as the component which imparts the essential character. Applying the aforementioned factors, the bulk and weight of both the paper and plastic components are very low. As the entire nail art variety pack costs 97 cents for six sheets of stickers, the price of the individual plastic and paper components is also very low. Looking only at the gemstone stickers, the quantity of the plastic gemstones is the same quantity as the flat stickers.
As these aforementioned factors do not determine the gemstone stickers’ essential character, we also look to the role of the two components. The flat stickers are in the shape of stars, hearts and flowers. They include a variety of colors. They are packaged together with other flat stickers which do not include gemstones. Looking at all of these factors, the role of the gemstone is subsidiary to the role of the flat sticker. The gemstone is a sparkly addition to a flat paper sticker which already functions as nail art on its own. As such, we find that the flat paper sticker portion imparts the essential character to the gemstone stickers. Like the flat paper stickers, the gemstone stickers are classified under heading 4823, HTSUS, as paper shapes.
As all of the stickers are classified under heading 4823, HTSUS, rather than in heading 7117, HTSUS, their value is not at issue with regard to their classification. Therefore, we will not respond to the second question posed by the Protestant pertaining to whether the term “pieces” describes the sticker or the sheet.
HOLDING:
By application of GRI 1 (Note 2(g) to Chapter 48), the flat stickers are classified under heading 4823, HTSUS. They are specifically provided for in subheading 4823.90.86, which provides, in pertinent part, for “Other paper, paperboard, cellulose wadding and webs of cellulose fibers, cut to size or shape…; other: other: other …” The 2010 column one, general rate of duty is free. Since re-classification of the merchandise as indicated above will result in a lower rate of duty than claimed, you are instructed to ALLOW the protest in full.
By application of GRI 3(b), the gemstone stickers are classified under heading 4823, HTSUS. They are specifically provided for in subheading 4823.90.86, which provides, in pertinent part, for “Other paper, paperboard, cellulose wadding and webs of cellulose fibers, cut to size or shape…; other: other: other …” The 2010 column one, general rate of duty is free. Since re-classification of the merchandise as indicated above will result in a lower rate of duty than claimed, you are instructed to ALLOW the protest in full.
Duty rates are provided for your convenience and subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at www.usitc.gov.
You are to mail this letter together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of this letter, the Office of International Trade will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division