CLA-2-94:OT:RR:NC:N4:433
Stephen Lawson
President
Tag Hardware Systems Ltd.
Unit 100 – 19072, 26th Avenue
Surrey, British Columbia V3S 3V7
Canada
RE: The tariff classification of a sliding closet mirror; NAFTA preferential duty treatment; and country of origin.
Dear Mr. Lawson:
In your letter dated July 25, 2014, you requested a tariff classification ruling, NAFTA eligibility, and country of origin of a sliding closet mirror. Illustrative literature was provided.
Part # 300.3410 is identified as the Elite Closet Mirror. You provide the following product description of the Elite Closet Mirror: “The product consists of a combination of glass mirror, stamped steel mounting plates, ball bearing drawer slides and plastic fittings. The complete assembly is designed to attach to the vertical partition (side) of a closet organizer system. The sliding mechanism attached to the back of the mirror allows it to slide outwards from the closet organizer and then pivot or rotate to face the person. Once the customer has dressed, they can then rotate the mirror back, parallel to the vertical partition, and then slide the mirror back into the closet organizer system, tucking it away neatly.” You further state that the sliding closet mirror has no use as a stand-alone item, and only functions when mounted to the vertical partition (side) of a closet organizer system.
No coasted bill of materials was provided for the sliding closet mirror. Nevertheless, a company listing of materials with the country of origin for those materials indicates: (1) the mirror is country of origin Taiwan, (2) the metal sliding plate, metal fixed plate, metal lever arm and pair of ball bearing slides are country of origin Taiwan, (3) the aluminum side channels are country of origin Taiwan, (4) the plastic molded guides and washers are country of origin Canada, and (5) the packaging to protect the mirror is country of origin Canada.
To answer whether or not the sliding closet mirror imported by Tag Hardware Systems belongs within heading 9403 “Other furniture and parts thereof” of the Harmonized Tariff Schedule of the United States (HTSUS), a full reading of the text of Legal Note 3 (a) to Chapter 94, HTSUS is in order. Legal Note 3 (a) to Chapter 94, HTSUS reads: In headings 9401 to 9403 references to parts of goods do not include references to sheets or slabs (whether or not cut to shape but not combined with other parts) of glass (including mirrors), marble or other stone or of any other material referred to in chapter 68 or 69. To further assist in the understanding of Legal Note 3 (a) to Chapter 94, the Explanatory Notes (ENs) to Chapter 94, “Parts,” to the Harmonized Tariff Schedule (HTS) state: In addition to the exclusions referred to in the individual Explanatory Notes below, this Chapter also excludes, at (c), Sheets of glass (including mirrors), marble or other stone or of any other material referred to in chapter 68 or 69, whether or not cut to shape, unless they are combined with other parts which clearly identify them as parts of furniture (e.g. a mirror-door for a wardrobe). At a minimum, based on the product description above, the sliding closet door combined with mountings and/or fittings (drawer slides, and stationary and sliding plates), used within a closet organizer system, falls within heading 9403, HTSUS.
A further reading of the Legal Note 2 and 2 (a) to Chapter 94, HTSUS, provides at 2, that the articles (other than parts) referred to in the headings of 9401 to 9403 are to be classified in those headings only if they are designed for placing on the floor or ground, and at 2 (a) the following are, however, to be classified in the above headings even if they are designed to be hung, to be fixed to the wall or to stand one on the other --- (a) Cupboards, bookcases, other shelved furniture (including single shelves presented with supports for fixing them to the wall) and unit furniture and (b) Seats and beds. One also finds in a reading of the ENs to the HTS, Chapter 94, “General,” a further elaboration of Legal Note 2 (a) to include “separately presented elements of unit furniture.”
The term “unit furniture” is not defined in the text of Chapter 94 or its heading 9403 of the HTSUS, nor the ENs to the HTS. When terms are not defined, they are construed in accordance with their common and commercial meaning – Nippon Kogasku (USA), Inc. v. United States, 69 CCPA 89, 673 F.2d 380 (1982). Common and commercial meaning may be determined by consulting dictionaries, lexicons, scientific authorities and other reliable sources. C.J. Tower & Sons v. United States, 69 CCPA 128, 673 F.2d 1268 (1982).
In Storewall, LLC versus the United States, Slip Op. 09-146, Court No.05-00462 dated December 18, 2009, the United States Court of International Trade (CIT), using relevant sources derived the following meaning for the term unit furniture: An item (a) fitted with other pieces to form a larger system or which is itself composed of smaller complementary items, (b) designed to be hung, or fixed to the wall, or stand one on the other or side by side, (c) assembled together in various ways to suit the consumer’s individual needs to hold various objects or articles, and (d) excludes other wall fixtures such as coat, hat and similar racks, key racks, clothes brush hangers, and newspaper racks. Further, The United States Court of Appeals for the Federal Circuit, in Storewall, LLC versus the United State, 2010-1193, not only upheld the meaning of unit furniture as defined by the CIT, but also added that unit furniture may be assembled together in various ways to suit the consumer’s individual needs to hold various objects and articles, and it was this versatility and adaptability that was the essence of unit furniture.
We acknowledge that the sliding closet mirror is a dedicated and irrevocable part of a closet organizer system, but more than that, it is a separately presented element of unit furniture, of which the entire closet organizer system, if imported together, would be classified as unit furniture. The sliding closet mirror is only one unit element of a closet organizer systems, which normally can include shelves, baskets, drawers, racks and other unit elements. Consistent with the Courts’ interpretation for unit furniture, we are of the opinion that the sliding closet mirror is classifiable within the furniture provisions of heading 9403, HTSUS.
The applicable subheading for the sliding closet mirror, which is a separately presented element of unit furniture, will be 9403.89.6010, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Other furniture and parts thereof: Furniture of other materials, including cane, osier, bamboo or similar materials: Other: Other; Household.” The rate of duty will be 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 World Wide Web at http://www.usitc.gov/tata/hts/.
To be eligible for tariff preferences under the North American Free Trade Agreement (NAFTA), goods, must be “originating goods” within the rules of origin in General Note 12 (b), HTSUS. In this instance, to be an “originating good” the sliding closet mirror must be transformed in the territory of Canada pursuant to General Note 12 (b) (ii), (A) and (B), which states: (A) except as provided in subdivision (f) of this note, each of the non-originating materials used in the production of such goods undergoes a change in tariff classification described in subdivisions (r), (s) and (t) of this note or the rules set forth therein, or (B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note.
In examining whether or not the sliding closet mirror is transformed in the territory of Canada, the NAFTA tariff shift rule of origin, as provided in General Note 12 (t), Chapter 94, Note 4 to the HTSUS, is applicable. The rule states at: (A), A change to subheading 9403.10 through 9403.89 from any other chapter and (B), A change to subheading 9403.10 through 9403.89 from subheading 9403.90, whether or not there is also a change from any other chapter, provided there is a regional value content of not less than (1) – 60 percent where the transaction value method is used, or (2) – 50 percent where the net cost method is used.
Upon review of the company listing of materials: the base metal mountings and fittings are all classified outside of Chapter 94, HTS; the plastic molded guides and washers are originating as they are a product of Canada; and the aluminum side channels, cut to shape and form and attached to the sides of the mirror, are of Taiwanese origin. The aluminum side channels are classifiable as parts of furniture in subheading 9403.90, HTS. Since the aluminum side channels of Taiwanese origin do not meet the tariff shift rule of origin, for they are classified in Chapter 94, HTS, and are not De-minimis in accordance with General Note 12 (f), General Note 12 (t), Chapter 94, Note 4 rule (A) is not met. Consequently, rule (B) would need to be addressed to determine if the sliding closet mirror satisfies a regional value content requirement. Using net cost as the method of calculating the regional value content, based on company provided information, one finds that the sliding closet mirror does not meet the 50 percent requirement for the good to be considered NAFTA originating. Because rule (A) or rule (B) are not satisfied, the sliding closet mirror is not an originating good for NAFTA duty purposes. Note: a proper NAFTA study with a costed bill of materials and its associated expenses, as well as changes in the sourcing of materials, may yield different findings for NAFTA preferential duty treatment.
Part 134, Customs Federal Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. In Section 134.1 (b), the country of origin of an article is defined as the country of manufacture, production, or growth of any article of foreign origin entering the United States. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the country of origin for country of origin marking purposes. 19 CFR 134.1 (b) is not applicable for NAFTA goods, as country of origin will be determined in accordance with 19 CFR 102 – Rules of Origin.
19 CFR, Section 102.20, “specific rule by tariff classification,” states: for 9403.10-9403.89 – A change to subheading 9403.10 through 9403.89 from any other subheading outside that group, except from subheading 9401.10 through 9403.89, and except from subheading 9401.90 and 9403.90 when that change is pursuant to General Rule of interpretation 2(a). To the Contrary of GRI 2(a), company provided information indicates that the sliding closet mirror is not imported in incomplete or unfinished or unassembled or disassembled condition. As such, the aluminum side channels, classified in subheading 9403.90, not falling within subheading 9401.10 through 9403.89, as well as all the other components classified in other Chapters of the HTS, meet the country of origin rule for the classification of the finished good. Accordingly, the country of origin for the sliding closet mirror is Canada.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Neil H. Levy at E-mail Address: [email protected].
Sincerely,
Gwenn Klein Kirschner
Director
National Commodity Specialist Division