CLA-2 RR:CTF:TCM W968134 RSD
TARIFF NOs.: 9505.10.2500, 6702.90.6500
Port Director
United States Customs and Border Protection
101 E. Main Street
Norfolk, Virginia 23510
RE: Application for Further Review of Protest Number 1401-05-100353; Christmas Holiday Decorations Used in Starbucks Coffee Stores
Dear Port Director:
This is our decision on protest 1401-05-100353 filed by the Starbucks Coffee Company (Starbucks) against your action regarding the classification of certain paper Christmas poinsettia garlands, and a tree under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). The goods were entered on August 31, 2004. The entry under protest was liquidated on July 15, 2005. The protest was timely filed on September 22, 2005. Starbucks sent a series of e-mails on October 4 and 5, 2006, which contained attachments with pictures and information regarding the specific items that are the subject of this protest. A telephone conference was conducted with Protestant’s representatives and members of my staff on October 27, 2006, to discuss this matter.
FACTS:
The articles that are the subject of this protest are certain garlands and a tree composed of artificial poinsettia leaves made of white paper. Starbucks imported these items in August of 2004 for decorating its stores during the Christmas holidays of that year. The paper leaves are attached to wire stems that have been wrapped with white paper. The poinsettia beads are made of Styrofoam and coated with red colored lacquer. The leaves and beads are bound together with white paper to form the poinsettia flower. The flowers are attached together to form the garlands or the tree.
An e-mail attachment from your office indicates that there are three specific items under consideration in this protest. They are: 1) SKU 186983, “Trim Garland Holiday” 2) SKU 186985, “Basket Garland” and 3) SKU 186988 “Trim Table Top Tree Holiday”. Although Starbucks may have imported other similar holiday decorations, in this protest, we are limited to reviewing the classifications of the specific items that were protested. The classifications of other similar items could be considered in other protests or internal advice requests.
All the items are made with paper poinsettia leaves that are white in color. According to the pictures contained in the e-mail attachment, a red ribbon is attached to the Basket Garland. The Table Tree appears to be a combination of wreaths that are placed around a red pole so that it resembles a modern rendition of a Christmas tree.
The Protestant claims that these items were used in its stores as decorations only during the Christmas holiday season and that they had no other use. To support this point, the Protestant submitted a copy of instructions that were issued to Starbucks stores from a Holiday 2004 Workbook concerning the display of the holiday decorations. These instructions indicate that all stores will receive the Starbucks holiday trim to create a festive atmosphere with a unified theme. The holiday trim will be used from holiday setup through December 25, and on December 26, it will be removed. The instructions further explained that the holiday decorations will be removed and SKU’d for sale, but that the holiday trim is not to be sold prior to December 26.
Customs and Border Protection (CBP) has issued two prior rulings to Starbucks concerning articles made of paper poinsettia leaves. In NY K88100, dated August 5, 2004, CBP considered the classification of a Christmas Banner Garland. In NY K88101, dated August 5, 2004, CBP considered the classification of a poinsettia leaf sprig Christmas Basket Garland. In both rulings, CBP held that the applicable heading for the articles under consideration was heading 6702, HTSUS, as “artificial flowers, foliage and fruit and parts thereof; articles made of artificial flowers, foliage or fruit.” Starbucks believes that these rulings are not correct. Instead, Starbucks contends that the decorations made of paper poinsettia leaves should be classified in heading 9505, HTSUS, as “festive, carnival or other entertainment articles, including magic tricks and practical joke articles; parts and accessories thereof.”
ISSUE:
Whether the Starbucks Christmas decorations under protest consisting of garlands and a tree made of artificial paper leaves should be classified in heading 9505, HTSUS, as festive articles or in heading 6702, HTSUS, as artificial flowers and foliage.
LAW AND ANALYSIS:
Merchandise is classifiable under the HTSUSA in accordance with the General Rules of Interpretation (GRIs). The systematic detail of the HTSUSA is such that virtually all 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. 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 may then be applied.
The HTSUSA provisions under consideration are as follows:
6702 Artificial flowers, foliage and fruit and parts thereof;
articles made of artificial flowers, foliage or fruit:
* * *
6702.90 Of other materials:
* * *
Other
* * *
6702.90.65 Other.
* * *
9505 Festive, carnival or other entertainment articles, including magic tricks and practical joke articles;
parts and accessories thereof:
9505.10 Articles for Christmas festivities and parts and accessories thereof:
* * *
Other
9505.10.50 Other.
* * *
The Harmonized Commodity Description and Coding System Explanatory Notes (EN’s) constitute the official interpretation of the Harmonized System. While not legally binding on the contracting parties, and therefore not dispositive, the EN’s provide a commentary on the scope of each heading of the Harmonized System and are thus useful in ascertaining the classification of merchandise under the Harmonized System. CBP believes the EN’s should always be consulted. See T.D. 89 80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
The Protestant believes that the articles made up of paper poinsettia leaves should be classified as “festive articles” under heading 9505, HTSUSA. In Midwest of Cannon Falls, Inc. v. United States, 20 C.I.T. 123 (Ct. Int’l Trade, 1996), aff’d in part, rev’d in part, 122 F.3d 1423 (Fed. Cir. 1997) (hereinafter Midwest), the Court addressed the scope of heading 9505, HTSUSA, specifically the class or kind of merchandise termed “festive articles,” and provided new
guidelines for classification of such goods in the heading.
The general criteria for determining "class or kind" with respect to classification were 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 (hereinafter Carborundum). Those criteria include the general physical characteristics of the article, the expectation of the ultimate purchasers, the channels, class or kind of trade in which the item moves, the environment of the sale (accompanying accessories and the manner in which the item is advertised and displayed), the use in the same manner as merchandise which defines the class, the economic practicality of so using the import, and recognition within the trade of this use.
EN 95.05 indicates that the heading covers in relevant part:
Festive carnival or other entertainment articles, which in view of their intended use are generally made of non-durable material. They include:
Festive decorations used to decorate rooms, tables etc. (such as garlands, lanterns, etc.); decorative articles for Christmas trees (tinsel, coloured balls, animals and other figures, etc.); cake decorations which are traditionally associated with a particular festival (e.g., animals, flags).
(2) Articles traditionally used at Christmas festivities, e.g., artificial
Christmas trees, nativity scenes, nativity figures and animals, angels, Christmas crackers, Christmas stockings, imitation yule logs, Father Christmases.
* * *
In contrast, heading 6702, HTSUS, provides for artificial foliage and articles made of artificial foliage. EN 67.02 states, in pertinent part:
This heading covers:
Artificial flowers, foliage and fruit in forms resembling the natural products, made by assembling various parts (by binding, glueing, assembling by fitting into one another or similar methods). This category also includes conventional representations of flowers, foliage or fruit made up in the manner of artificial flowers, etc.
Parts of artificial flowers, foliage or fruit (e.g., pistils, stamens, ovaries, petals, calyces, leaves and stems).
Articles made of artificial flowers, foliage or fruit (e.g., bouquets, garlands, wreaths, plants), and other articles, for use as trimmings or as ornaments, made by assembling artificial flowers, foliage or fruit.
Previously, CBP has noted that several items composed of artificial foliage satisfy the Midwest guidelines and are recognized as festive articles for the Christmas holiday. These items include evergreen branches, poinsettia, pine cone, pine needle leaves, holly leaves, laurel leaves, holly berries or mistletoe, which are incorporated into a wreath, centerpiece, candle ring, garland, swag or sprig. See HQ 967237 dated September 9, 2004.
When examining the tree and garlands, as a whole, it must be evident that the articles are traditionally associated or used with the particular festival of Christmas. Artificial Christmas trees are cited in the EN's to 9505, HTSUS, as exemplars of traditional festive articles. Furthermore, in HQ 950999, dated April 16, 1992, garlands with artificial foliage were classified in 9505.10.40, HTSUS, as festive articles for Christmas festivities. The following is the language from HQ 950999 wherein CBP explained which types of garlands, wreaths, etc. would be classifiable in 9505.10, HTSUS, as festive articles for Christmas festivities.
Those artificial foliage items which qualify as Christmas articles of subheading 9505.10 include wreaths, garlands, candle rings, centerpieces -- complete articles -- made up of foliage commonly and traditionally associated with Christmas [i.e., artificial poinsettias, pine cones, pine needle leaves, evergreen branches, holly berries, holly leaves, laurel leaves, or mistletoe (singly or combination thereof)]. (This largely restates Customs position under the TSUS). These articles can be further decorated with plastic sleighs, miniature Santas, glass balls, ribbon, etc. Stylized/modern versions of Christmas wreaths, garlands, etc. (i.e., those articles decorated with neon poinsettias, mauve glass balls, etc.) also qualify as festive.
We must determine whether the Starbucks decorative articles under consideration can be classified as festive articles in heading 9505, HTSUS, or as artificial foliage in heading 6702, HTSUS. In making this determination, we must first analyze whether the decorations under consideration fit criteria for festive articles that are classified in heading 9505, HTSUS. The decorations under consideration can be categorized into two basic products, the tree and garlands. In considering the Midwest standards, we believe that the table top tree is readily recognizable as an article that would be clearly connected with Christmas. Although the trim tabletop tree in this case is a somewhat unconventional version of a typical Christmas decoration, it still has the general shape and appearance of a Christmas tree. Because the article is used to decorate retail stores during the specific holiday of Christmas and they can be clearly identified as a Christmas tree, the instant decoration belongs to a class of merchandise that is holiday related. Thus, we find that this article is so closely associated with the Christmas holidays that it would only be used as a display to celebrate the Christmas holiday and that displaying it at any other time of the year would be aberrant. Therefore, the Table Top Tree satisfies the threshold requirement for being classified in heading 9505, HTSUS, as a festive article.
However, although the table top trees fit the criteria for articles that are classified in heading 9505, HTSUS, as festive articles, we recognize that they also could be described as artificial foliage in heading 6702, HTSUS. Because Chapter 95, HTSUS, does not exclude artificial flowers and foliage, we are still left with the question as to whether the decorations in question are properly classified in heading 9505, HTSUS, as festive articles or in heading 6702, HTSUS, as artificial foliage. Since the articles in question are prima facie classifiable in two headings, 9505 and 6702, we believe that GRI 3 must be consulted. GRI 3(a) directs that the heading which provides the most specific description of the merchandise is to be preferred. Articles classifiable in heading 9505 tend to have no other function than decoration, and thus heading 9505 is generally regarded as a use provision, while heading 6702, HTSUS, gives a description by name and thus is regarded as a eo nomine provision. As between eo nomine and use provisions, the general rule is in the absence of legislative intent to the contrary a product described by both a use provision and eo nomine provision is generally more specifically provided for under the use provision. See Carl Zeiss, Inc. v. United States, 195 F.3d. 1375 (Fed. Cir. 1999). In other words, the use provision is generally regarded as being the more specific provision because it is usually the more difficult to satisfy. See HQ 087716, dated November 9, 1990. Accordingly, classification of the tree as a festive article in heading 9505, HTSUS, would be more specific than classification in heading 6702, HTSUS, as artificial foliage. Therefore, in accordance with GRI 3(a), we find that the Trim Tabletop Tree that is being protested in this case is classified in heading 9505, HTSUS, as a festive article.
In contrast to the tree, we believe that the two garlands, under consideration in this case, are not immediately recognizable as Christmas decorations. Although Starbucks has presented evidence to show that they were intended for use as decorations in their stores during Christmas time, we believe that based on their appearance, the different garlands do not seem to be exclusively associated with Christmas celebrations. In other words, in our judgment, there seems to be no reason why they could not be used as decorations at another time of the year. The garlands that are under consideration in this case are not the customary garlands that are typically exhibited as Christmas decorations. They are not made of tinsel nor they do they have the usual customary Christmas colors of red and green. Although they are made of white paper and are supposed to resemble poinsettia leaves and flowers, we do not believe that most people would be able to discern that the white paper leaves are supposed to be artificial poinsettia leaves and flowers that are connected with the Christmas celebration. While they are certainly used by Starbucks as decorations during the Christmas holiday, if they were set apart from other Christmas decorations, we do not think that they would immediately stand out as items that would only be seen at Christmas time. Rather, in our judgment, they could be easily used as banners or streamers to decorate an area during other celebratory occasions besides the Christmas holidays. Thus, we believe that it would not be aberrant to display them as decorations at times during the year other than Christmas. Therefore, we find that the garlands under protest in this case are not classified as festive articles in heading 9505, HTSUS, but instead in heading 6702, HTSUS, as: “Artificial flowers, foliage and fruit and parts thereof: articles made of artificial flowers foliage or fruit.”
HOLDING:
The “Trim Table Top Tree Holiday” is classified in heading 9505, HTSUS. It is specifically provided for in subheading 9505.10.2500, HTSUSA as: “Festive, carnival or other entertainment articles, including magic tricks and practical joke articles; parts and accessories thereof: Articles for Christmas festivities and parts and accessories thereof: Christmas ornaments: Other: Other.” The column one general rate of duty at the time of entry was free.
The remaining items that are under protest, the “Basket Garland” and “Trim Garland Holiday” are classified in heading 6702, HTSUS. They are specifically provided for in subheading 6702.90.6500, HTSUSA, as: “Artificial flowers, foliage and fruit and parts thereof; articles made of artificial flowers, foliage or fruit: Of other materials: Other: other.” The column one duty rate at the time of entry was 17 percent ad valorum.
Therefore, based on the foregoing, the protest is allowed in part and denied in part. In accordance with the Protest/Petition Processing Handbook (CIS HB, June 2002, pp. 18 and 21), you are to mail this decision, together with the CBP 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 the decision Regulations and Rulings, 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