OT:RR:CTF:CPM HQ H264917 MG
Regina Woody
Hobby Lobby Stores, Inc.
International Department
Corporate office
7707 SW 44th St
Oklahoma City, OK 73179
Re: Request for a ruling; Tariff Classification of various glass and metal beads.
Dear Ms. Woody:
This is in response to your request for a binding ruling dated March 13, 2015, filed by Hobby Lobby Stores, Inc., concerning the classification of various glass and metal beads “beads combo,” item 957548 and 958140, under the Harmonized Tariff Schedule of the United States (“HTSUS”). A sample of item 957548 was provided and will be returned per your request.
FACTS:
Item 957548 identified as “Flower & Silver Bead Combo” consists of seven components “beads” that vary in size, color and content. There are two identical bead pairs. Beads one and seven “Silver with grooves” on the bead combo are entirely made of zinc metal with grooves that are silver in color. Beads two “Light purple clear” and five “Light blue clear” have a brass metal core that accounts for 7% of the bead by weight and 54% of its value. The glass of beads two and five accounts for 93% of the weight and 46% of the value. Beads three and six are made of zinc metal, set with faceted glass rhinestones. They both consist of 99% zinc and 1% glass by weight, and 40% zinc versus 60% glass by value. The fourth bead resembles a flower with colored petals. It consists of 97% zinc by weight and 63% zinc by value. The colored portion is referred to as both “epoxy” at 3% by weight and as glass at 37% by value. The beads are packed strung on a piece of coated wire measuring five inches in length and is attached to a header card ready for retail sale. The face of the header card indicates "A Bead Story" and "by Charm Me®." The reverse side indicates "Uniquely You ... one bead charm at a time."
Item 958140 identified as “Black, White & Antique Brass Bead Combo” consists of eight beads that are temporarily strung on a piece of wire attached to a header card ready for retail sale. The beads vary in size, color and content. Beads one and eight “Antique” on the bead combo are entirely made of zinc metal. Beads two and seven “Black with white stripe” are primarily made of glass by weight and value. Bead two consists of 83% glass and 17% brass by weight, and 73% glass versus 27% brass by value. Bead seven consists of 83% glass and 17% brass by weight, and 63% glass versus 37% brass by value. Bead three “Antique & Crystal” is predominantly made of glass by weight and value. It consists of 35% glass and 65% zinc alloy by weight, and 63% glass versus 37% zinc alloy by value. Bead four “Flower on Black” is predominantly made of glass by weight and value. It consists of 83% glass and 17% brass by weight, and 77% glass versus 23% brass by value. Bead five “Antique Scroll” is entirely made of zinc metal. Bead six “Crystal Ball” consists of 553% glass and 45% iron by weight, and 44% glass versus 56% iron by value. The web page description states, in pertinent part, the following:
The A Bead story line is designed to make jewelry making quick, easy and uncomplicated so you’re free to be creative. Let your creativity run wild and turn it into a marvelous necklace, bracelet, and more.
Dimensions: Length: 1/8” to ½”
Width: 3/8” to ½”
Each package contains 8 pieces.
ISSUE:
Whether the subject merchandise is properly classified in heading 7018, HTSUS, as “Glass beads, imitation pearls, imitation precious or semiprecious stones and similar glass smallwares and articles thereof other than imitation jewelry,” in heading 8308, HTSUS, as “Beads and spangles of base metal,” or in heading, 7117, HTSUS, as imitation jewelry.
LAW AND ANALYSIS:
Merchandise imported into the United States is classified under 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. 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.
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 GRIs 2 through 6 may then be applied in order.
GRI 2 states the following:
Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as entered, the incomplete or unfinished article has the essential character of the complete or finished article. It shall also include a reference to that article complete or finished (or falling to be classified as complete or finished by virtue of this rule), entered unassembled or disassembled.
Any reference in a heading to a material or substance shall be taken to include a reference to mixtures or combinations of that material or substance with other materials or substances. Any reference to goods of a given material or substance shall be taken to include a reference to goods consisting wholly or partly of such material or substance. The classification of goods consisting of more than one material or substance shall be according to the principles of rule 3.
GRI 3 states the following:
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:
The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or 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.
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.
When goods cannot be classified by reference to 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.
The Harmonized Commodity Description and Coding System Explanatory Notes (EN) constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the EN provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of the headings. It is CBP’s practice to consult, whenever possible, the terms of the ENs when interpreting the HTSUS. See T.D. 89–80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The HTSUS provisions under consideration are as follows:
7018 Glass beads, imitation pearls, imitation precious or semiprecious stones and similar glass smallwares and articles thereof other than imitation jewelry; glass eyes other than prosthetic articles; statuettes and other ornaments of lamp-worked glass, other than imitation jewelry; glass microspheres not exceeding 1 mm in diameter:
7018.10 Glass beads, imitation pearls, imitation precious or semiprecious stones and similar glass smallwares:
7018.10.50 Other
* * *
7117 Imitation jewelry:
Of base metal, whether or not plated with precious metal:
Other:
Other:
7117.19.90 Other.
7117.90.00 Other:
Other:
Valued not over 20 cents per dozen pieces or parts:
7117.90.55 Other.
* * *
8308 Clasps, frames with clasps, buckles, buckle-clasps, hooks, eyes, eyelets and the like, of base metal, of a kind used for clothing or clothing accessories, footwear, jewelry, wrist watches, books, awnings, leather goods, travel goods or saddlery or for other made up articles; tubular or bifurcated rivets, of base metal; beads and spangles, of base metal:
8308.90 Other, including parts:
8308.90.30 Beads and spangles of base metal
Note 1(b) to Chapter 70, HTSUS, states that this chapter does not cover “Articles of chapter 71 (for example, imitation jewelry).” Note 1(e) to Section XV, which covers base metal and articles thereof, provides, in pertinent part, that this section does not cover “Goods of Chapter 71 (for example, precious metal alloys, base metal clad with precious metal, imitation jewelery).”
The legal notes to chapter 71 state, in pertinent part:
9. For the purposes of heading 7113, the expression “articles of jewelry” means:
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….
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….
The EN to Heading 70.18 states, in pertinent part, that:
This heading covers a range of widely diversified glass articles, most of which are used, directly or after further processing, for ornamental and decorative purposes.
These include:
(A) Glass beads (e.g., as used for necklaces, rosaries, imitation flowers, ornaments for graves, etc.; for decorating textile articles (trimmings, embroidery, etc.), handbags or the like; or for use as electrical insulators). …
The ENs to heading 7117, HTSUS, provide, in pertinent part:
For the purposes of this heading, the expression imitation jewellery, as defined in Note 11 to this Chapter, is restricted to small objects of personal adornment, such as those listed in paragraph (A) of the Explanatory Note to heading 71.13, e.g., rings, bracelets (other than wrist-watch bracelets), necklaces, ear-rings, cuff-links, etc….
The heading also covers unfinished or incomplete articles of imitation jewellery (ear-rings, bracelets, necklaces, etc.), such as:
Semi-finished split rings, consisting of anodised aluminium string, usually twisted or surface worked, whether or not fitted with a crude clasp, sometimes used as ear-rings without further working;
Ornamental motifs of base metal, whether or not polished, assembled by small links into strips of indefinite length.
The EN to Heading 83.08 states, in pertinent part, that:
This heading includes:
(E) Metal beads and spangles used, inter alia, for making imitation jewellery, or for decorating textile material, embroidery, clothing, etc. They are generally made of copper, copper alloys or aluminium (often gilded or silvered), and are designed to be fixed in position by glueing, sewing, etc. Beads are generally spherical or tubular or sometimes facetted; spangles, generally of geometrical form (round, hexagonal, etc.), are cut from metal foil and usually pierced. …
This heading also excludes:
Ornaments, other than buckles, for hats, handbags, shoes, belts, etc. (heading 71.17)
* * *
Under Note 1 (b) to Chapter 70, HTSUS, and Note 1(e) to Section XV, if the instant merchandise can be classified as imitation jewelry, under heading 7117, HTUS, it cannot be classified in either of the other two headings at issue.
The term “imitation jewelry” applies only to “small objects of personal adornment.” See chapter 71, note 9(a). These objects include, but are not limited to, “rings, bracelets, necklaces, brooches, earrings, watch chains, fobs, pendants, tie pins, cuff links, dress studs, religious or other medals and insignia.” A bead is defined as a small, usually round object of glass, wood, stone, or the like with a hole through it, often strung with others of its kind in necklaces, rosaries, etc.
You claim that the beads are temporarily strung. Merchandise is classified in the condition as imported. See United States v Citroen, 223 U.S. 407 (1911) (“The rule is well established that in order to produce uniformity in the imposition of duties, the dutiable classification of articles imported must be ascertained at the time of examination of the imported article itself, in the condition in which it is imported.” [citations omitted]). The instant merchandise consists of “8 pieces”—seven beads strung through one wire. There is no clasp or closure attached to the wire, and it is too short to create an article of jewelry with it. Therefore, even though unfinished goods are classified in the heading describing the finished good under GRI 2(b), without a useable wire, these strung beads do not have the essential character of jewelry. See, HQ H269223, dated June 8, 2017, and HQ H131975, dated March 21, 2011.
Instead, it appears that the purchaser is meant to discard the wire and restring the beads in their own creative way. Hence, in its condition as imported, the instant merchandise is seven glass and metal articles of different compositions.
A pendant is a piece of jewelry that hangs from a chain worn around the neck. Beads are not specifically named in this list of exemplars of note 9 to Chapter 71. The instant articles are small, made of metal or metal and glass, and have a hole that goes directly through the article. Even though they are not the same size and shape, they are meant to be strung together to create an article of jewelry. Hence, each bead cannot be considered a pendant that hangs from an already completed chain necklace. See, HQ H260945, dated July 31, 2015.
Furthermore, although a charm is considered ejusdem generis with the exemplars in note 9 to chapter 71, the instant articles are not worn on a bracelet either. A charm is defined as a small object worn or kept for supposed magical powers of protection; amulet; talisman or a trinket worn on a bracelet. The instant articles are used to create the necklace or bracelet rather than to attach to it. Neither are they excluded from classification in heading 8308, HTSUS, as an ornament for shoes or hats. Hence, the instant beads are not described as imitation jewelry in heading 7117.
Rather, the subject bead combinations consist of articles made from different materials and must be classified according to the component which gives the whole its essential character under GRI 3. Since the bead combinations consist of articles classified in two different headings, are put up together to carry out a specific activity (i.e., making jewelry) and are packaged for sale directly to the public and in a manner that is suitable for sale directly to users without repacking, each combination is a set under GRI 3(b).
In item 957548, identified as “Flower & Silver Bead Combo”, five of the seven beads are wholly or predominantly made of metal and two are predominantly made of glass by weight. However, 57% of the value of the seven beads combined is imparted by the metal components. The metal serves both a decorative purpose and a structural purpose to hold the glass and provide the hole through which to string the bead, whereas the glass is only decorative in relation to the use of the goods. Therefore, the metal component imparts the essential character to the Flower & Silver Bead Combo set.
Conversely, Item 958140, identified as “Black, White & Antique Brass Bead Combo” consists of eight beads that are temporarily strung on a piece of wire attached to a header card ready for retail sale. Five of the eight beads are predominantly made of glass and three are predominantly made of metal by weight. The value of the glass constitutes 54% of the total value of the eight beads. Therefore, the glass component imparts the essential character to the Black, White & Antique Brass Bead Combo set.
HOLDING:
Accordingly, pursuant to GRI 3 (b), Item 957548 identified as “Flower & Silver Bead Combo” is classified in heading 8308, HTSUS, and specifically provided for in subheading 8308.90.30, HTSUS, which provides for: “Clasps, frames with clasps, buckles, buckle-clasps, hooks, eyes, eyelets and the like, of base metal, of a kind used for clothing or clothing accessories, footwear, jewelry, wrist watches, books, awnings, leather goods, travel goods or saddlery or for other made up articles; tubular or bifurcated rivets, of base metal; beads and spangles, of base metal: Other, including parts: Beads and spangles of base metal.” The 2017 column one general rate of duty is “free.”
Pursuant to GRI 3 (b), Item 958140 identified as “Black, White & Antique Brass BeadCombo” is classified in heading 7018, HTSUS, and specifically provided for in subheading 7018.10.50, HTSUS, which provides for: “Glass beads, imitation pearls, imitation precious or semiprecious stones and similar glass smallwares and articles thereof other than imitation jewelry; glass eyes other than prosthetic articles; statuettes and other ornaments of lamp-worked glass, other than imitation jewelry; glass microspheres not exceeding 1 mm in diameter: Glass beads, imitation pearls, imitation precious or semiprecious stones and similar glass smallwares: Other.” The 2017 column one general rate of duty is “free.”
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the internet at https://hts.usitc.gov/current.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division