us-cbp-cross-rulings-hq-084935•HQ 084935: Tariff classification and marking requirements applicable to the BodyPro "Pocket Gym"
HQ 084935: Tariff classification and marking requirements applicable to the BodyPro "Pocket Gym"
us-cbp-cross-rulings-hq-084935HQ 084935: Tariff classification and marking requirements applicable to the BodyPro "Pocket Gym"Guidance
Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.
HQ 084935
August 23, 1989
CLA-2 CO:R:C:G 084935 DC
CATEGORY: Classification; Marking
TARIFF NO.: 9506.91.0030
Ms. Deborah J. Clune
PBB USA Inc.
P.O. Box 950
Buffalo, New York 14213
RE: Tariff classification and marking requirements applicable
to the BodyPro "Pocket Gym"
Dear Ms. Clune::
Your letter dated April 24, 1989, addressed to our Buffalo
office on behalf of Bodypro Inc. of 2384 Yonge Street, Toronto,
Ontario, concerning the tariff classification and marking
requirements applicable to a "Pocket Gym" from Canada, has been
referred to this office for a direct reply to you. A sample was
submitted for examination.
FACTS:
The sample pocket gym includes the following:
2 injection molded plastic handles made in Canada;
2 aluminum extension tubes extruded and machined in Canada;
one 2' by 3' folded instruction poster printed in Canada;
one 8 1/2" by 14" sports specific/product sheet printed in
Canada;
one 8 1/2" by 5 1/2" exercise sheet printed in Canada;
one nylon bag 9 1/4" long by 4" wide by 3 1/2 " high made in
Korea; and
one 10" twist tie made in Canada.
After importation, an 8' long piece of latex tubing and 4
"O" rings will be added.
-2-
ISSUE
Should the nylon bag be considered a container classifiable
in the same manner as its contents?
Does the "Pocket Gym" in its condition as imported
constitute a set for tariff purposes?
Is the "Pocket Gym" eligible for treatment as "goods
originating in the territory of Canada" for the purposes of the
U.S.- Canada FTA?
Is the nylon bag manufactured in Korea subject to visa
requirements and quota restraints.
Must the nylon bag be marked to indicate Korea as the
country of origin?
LAW AND ANALYSIS:
In applying the Harmonized Tariff Schedule of the United
States Annotated (HTSUSA), the Customs Service must follow the
terms of the statute. Classification of goods under the HTSUSA
is governed by the General Rules of Interpretation (GRI's). GRI
1 provides that "classification shall be determined according to
the terms of the headings and any relative section or chapter
notes, and, provided such headings or notes do not otherwise
require, according to [the remaining GRI's taken in order]." In
other words classification is governed first by the terms of the
headings of the tariff and any relative section or chapter notes.
GRI 5, HTSUSA, which is relevant in determining whether the
nylon bag should be classified in the same manner as its contents
reads as follows:
5. In addition to the foregoing provisions, the following
rules shall apply in respect of the goods referred therein:
(a) Camera cases, musical instrument cases, gun cases,
drawing instrument cases, necklace cases and similar
containers, specially shaped or fitted to contain a
specific article or set of articles, suitable for long-
term use and entered with the articles for which they
are intended, shall be classified with such articles
when of a kind normally sold therewith. This rule does
not, however, apply to containers which give the whole
its essential character;
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(b) Subject to the provisions of rule 5(a) above, packing
materials and packing containers entered with the goods
therein shall be classified with the goods if they are
of a kind normally used for packing such goods.
However, this provision does not apply when such
packing materials or packing containers are clearly
suitable for repetitive use.
Rule 5(a) does not apply here because the nylon bag is not
specially shaped or fitted to contain the exercise articles.
Further, Rule 5(b) is inapplicable because the nylon bag is
clearly suitable for repetitive use. Consequently, the bag is
not considered a container classifiable with its contents.
GRI 3, HTSUSA, is relevant in determining whether the
"Pocket Gym" is a set for tariff purposes. It reads in pertinent
part as follows:
3. 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:
(a) 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 . . . 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.
(b) 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.
GRI 3(b), HTSUSA, is relevant here because GRI 3(a), HTSUSA,
cannot be used in determining classification. The Explanatory
Notes for GRI 3, HTSUSA, state that the term "goods put up in
sets for retail sale" means goods that:
(a) consist of at least two different articles prima facie
classifiable in different headings (or, by GRI 6,
subheadings);
-4-
(b) consist of products or articles put together to meet a
particular need or carry out a specific activity; and
(c) are put up in a manner suitable for sale directly to
users without repacking (e.g., in boxes or cases or on
boards).
It is our opinion that the components comprising the "Pocket
Gym" meet the criteria set forth above for being considered a set
for tariff purposes.
Since we have concluded that the components of the "Pocket
Gym" constitute a set for tariff purposes, it is necessary to
determine which component of the set imparts the essential
character thereto. The Explanatory Notes for GRI 3(b), HTSUSA,
state in pertinent part as follows:
VIII The factor which determines essential character
will vary as between different kinds of goods. It
may, for example, be determined by the nature of
the material, its bulk, quantity, weight or value,
or by the role of a constituent material in
relation to the use of the goods.
It is our observation that the exercise equipment in the
"Pocket Gym" imparts the essential character to the set. Our
rationale for this position is that these components are
dedicated to the specific activity for which the set was designed
viz., exercise. Consequently, this set is classifiable under
subheading 9506.91.0030, HTSUSA, as articles and equipment for
gymnastics, athletics, other sports (including table-tennis) or
outdoor games, not specified or included elsewhere in this
chapter, other, gymnasium or other exercise articles and
equipment, parts and accessories thereof, other.
A determination as to whether the set qualifies as "goods
originating in the territory of Canada" is governed by General
Note 3(c)(vii) HTSUSA, which reads in pertinent part as follows:
United States-Canada Free Trade Agreement Implementation Act
of 1988
(B) For the purposes of subdivision (c)(vii) of this note,
goods imported into the customs territory of the United
States are eligible for treatment as "goods originating in
the territory of Canada" only if--
(1) they are goods wholly obtained or produced in the
territory of Canada and/or the United States, or
-5-
(2) they have been transformed in the territory of Canada
and/or the United States, so as to be subject--
(1) to a change in tariff classification in Canada as
described in the rules of subdivision (c)(vii)(R)
of this note, or . . .
The set is eligible for treatment as "goods originating in
the territory of Canada" because a substantial transformation has
occured here. Specifically, the nylon bag imported into Canada
was classified under Chapter 42 while the nylon bag with the
exercise equipment is considered a set classifiable under Chapter
95, TSUSA.
Merchandise which is classifiable per se under Chapter 95,
HTSUSA, is not subject to visa requirements or quota restraints.
However, the nylon bag is not classifiable per se under that
chapter. It is only classifiable therein by virtue of its being
a component of the set. Thus, the nylon bag is subject to visa
requirements and quota restraints.
With respect to marking requirements, it should be noted
that Section 304 of the Tariff Act of 1930, as amended (19 U.S.C.
1304), provides that every article of foreign origin (or its
container) imported into the United States shall be marked in a
conspicuous place as legibly, indelibly and permanently as the
nature of the article (or container) will permit, in such a
manner as to indicate to the ultimate purchaser in the United
States the English name of the country of origin of the article.
Section 134.1(b), Customs Regulations (19CFR 134.1(b)),
defines "country of origin" 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" within
the meaning of marking laws and regulations. The case of U.S. v.
Gibson-Thomsen Co., Inc., 27 CCPA 267, C.A.D. 98 (1940), stands
for the principle that an article used in manufacture which
results in an article having a name, character or use differing
from that of the constituent article will be substantially
transformed.
You suggest that the country of origin marking should be
consistent with the tariff classification of an article. We do
not agree that the classification of an article must control the
country of origin marking of the nylon bag. Courts have
acknowledged the reality that the application of differing laws
-6-
relating to the importation of goods into the U.S. can result in
differing origins for the same product. In discussing the
differences between the marking laws, drawback laws and the
Generalized System of Preferences (GSP), the court in National
Juice Products Association v. United States, 10 CIT 48, 628 F.
Supp. 978 (1986), concluded, "[t]hus, although the language of
the tests applied under the three statutes is similar, the
results may differ where differences in statutory language and
purpose are pertinent." National Juice, Note 14, at 58-59. We
maintain that the differing purposes of the marking laws compared
with the classification schedules justify a different result in
the present instance; one for country of origin, one for tariff
classification.
The pertinent statutory purpose involved in application of
the marking laws was explained in United States v. Friedlaender &
Co., 27 CCPA 297, C.A.D. 104 (1940) as follows:
Congress intended that the ultimate purchaser should be
able to know by an inspection of the marking on
imported goods the country of which the goods is the
product. The evident purpose is to mark the goods so
that at the time of purchase the ultimate purchaser
may, by knowing where the goods were produced, be able
to buy or refuse to buy them, if such marking should
influence his will.
In view of the foregoing, it is our position that since the
nylon bag is made in Korea and is not subjected to any processes
in Canada that would permit waiver of marking requirements, the
bag must be marked "Made in Korea." We suggest a sewn-in label
would be acceptable. The handles and tubes may be marked with a
sticker "Made in Canada." The printed sheets and poster should
state "Printed in Canada."
HOLDING:
The "Pocket Gym" is classifiable under subheading
9506.91.0030, HTSUSA, with duty at the rate of 4.1 percent ad
valorem.
The nylon bag is subject to visa requirements and quota
restraints under subheading 4202.92.3030, HTSUSA. The textile
category is 670.
-7-
Due to the changeable nature of the statistical annotation
(the ninth and tenth digits of the classification) and the
restraint (quota/visa) categories, you should contact your local
Customs office prior to importation of this merchandise to
determine the current status of any import restraints or
requirements.
Sincerely,
John Durant, Director
Commercial Rulings Division
6cc A.D. NY Seaport
1cc Dist Dir Buffalo
1cc Kevin Gorman
1cc Mike Tomenga NY Seaport
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