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HQ 081763


October 3, 1988

CLA-2 CO:R:C:G 081763 SM

CATEGORY: CLASSIFICATION

TARIFF NO.: 4202.22.8050

Steven W. Baker, Esq.
Bellsey and Baker
Suite 670
100 California Street
San Francisco, CA 94111

RE: Classification of certain handbags

Dear Mr. Baker:

Your letter of December 11, 1987, on behalf of Esprit de Corp, requests a tariff classification ruling under the pro- posed Harmonized Tariff Schedule of the United States Anno- tated (HTSUSA) for certain handbags. The submitted samples are marked "Made in Korea" or "Made in Hong Kong."

FACTS:

Samples of four different styles of handbags, 17096, 17070, 17121, and 17001, were received. No specific informa- tion is provided about any of them. You state that they are representative of similar additional styles. You also state that the various styles are constructed of leather, textile, and plastic with metal buckles and catches; and that each bag is both in chief value and in chief weight of the leather, which is used for the straps, edgings, flaps, and certain trim.

You believe that the bags should be classified as leather handbags under heading 4202, HTSUSA, for the following reasons: the current tariff and textile category treatment would be preserved; the bags are in chief weight of leather; and GRI 3(b) requires that the bags be classified according to the material which gives them their essential character, i.e., leather.

ISSUE:

How are the handbags, of mixed materials, classified under the proposed HTSUSA?

LAW AND ANALYSIS:

In the course of developing the conversion of the Tariff Schedules of the United States Annotated (TSUSA) to the HTSUSA, efforts were made to avoid tariff rate changes to the extent practicable and to simplify the tariff where possible without rate changes significant for U.S. industry, workers, or trade. Hearings were held under the direction of the Office of the United States Trade Representative, and negoti- ations were held among GATT partners to work out compensation for duty changes where necessary.

It was not possible to develop the conversion without any changes at all. The proposed HTSUSA is a new statute; it groups articles in different ways from the TSUSA in some cases; and it uses different rules of classification. Chief value is not part of the law; neither is the TSUSA distinction between ornamented and not ornamented textile articles. Many articles now classified separately are specifically provided for as sets. These and other major changes incorporated into the law will affect tariff classification.

In applying the HTSUSA, the Customs Service must follow the terms of the proposed statute. Classification of goods under the HTSUSA is governed by the General Rules of Inter- pretation (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.

The second part of heading 4202, HTSUSA, provides for handbags, among other articles, of certain specified mater- ials. Considering the general appearance of the submitted samples, we agree that they are handbags.

The Explanatory Notes, the official interpretation of the HTSUSA at the international level, state that, as the heading itself specifies, "articles covered by the second part of the heading must . . . be only of the materials specified therein or must be wholly or mainly covered with such materi- als . . . ." Since the specified materials include leather and textile materials, the bags are classified under heading 4202.

Subheadings 4202.21 and 4202.22, HTSUSA, provide for handbags, whether or not with shoulder strap, including those without handle. Subheading 4202.21 covers those with outer surface of leather, or composition leather, or of patent leather; subheading 4202.22 includes those with outer surface of plastic sheeting or of textile materials. Thus, classifi- cation depends on the composition of the outer surface.

The outer surface of all four bags is partly leather and partly textile materials. Style 17001 has an outer surface of leather and a textile material coated, covered, or laminated with plastic on one side. No subheading under heading 4202 provides for handbags consisting of both leather and textile materials; thus, classification cannot be determined under GRI 1.

GRI 2(a) does not apply, since it refers to articles in- complete or unassembled. GRI 2(b) provides:

Any reference in a heading to a material or sub- stance 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 con- sisting of more than one material or substance shall be according to the principles of rule 3.

Following GRI 6, GRI 2(b) also applies to classification of goods in the subheadings of a heading. Thus, subheading 4202.21, HTSUSA, for handbags with outer surface of leather, is taken to include handbags with outer surface of leather and other materials. Subheading 4202.22, HTSUSA, for handbags with outer surface of textile materials, is taken to include handbags with outer surfaces of these materials together with other materials. Classification of the bags will therefore be in accordance with GRI 3.

Under GRI 3(a), since each subheading on its face refers to part only of the materials in the bags, the two subheadings are regarded as equally specific, and therefore classification cannot be determined with reference to relative specificity.

GRI 3(b) provides that composite goods consisting of different materials, such as these leather and textile bags, that cannot be classified by reference to GRI 3(a) shall be classified as if they consisted of the material that gives
them their essential character, if that can be determined. The Explanatory Notes for GRI 3(b) state:

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 mater- ial . . . its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.

Examination of the bags reveals that the most signifi- cant leather portion of each is the shoulder strap. While the largest dimension of any of the bags is eight inches, the straps are four to five feet long. On the body of the bags themselves, leather is used as piping or as binding on the raw edges. Additionally, Style 17070 has a three-quarter-inch- wide leather strip on the flap. Style 17001 has a one-and- three-eighths-inch-wide leather strip bearing the name "Esprit" across one side. Style 17096 has a leather draw- string and flap, and a three-quarter-inch-wide strip down each side and across the front. The outer surface of the actual bag in each case--the portion used to contain and carry per- sonal effects--consists almost entirely of textile materials.

The leather is used to make the trim and straps. The bags are essentially textile, with leather trim. In our view, the essential character of the bags is not determined by the material of the trim and straps, and we conclude that the goods are not classifiable as bags that are essentially leather.

No heading, legal note, explanatory note, or GRI re- quires that the bags be classified as leather if the leather in each weighs more than the textile materials. In general, when an article that is essentially textile is composed of more than one textile material, it will be classified as if it consisted solely of that textile material that predominates by weight over any other single textile material. Section XI, Note 2; Subheading Note 2. However, there is no general rule that goods composed of more than one material are classified according to the material of which they are in chief weight. GRI 3(b) generally requires that such goods be classified according to the material that gives them their essential character, if they are not first classifiable according to GRI 1.

HOLDING:

The submitted samples are classified under subheading 4202.22.8050, HTSUSA, textile category 670, as handbags with outer surface of textile materials, assuming that the textile materials are of man-made fibers. This classification repre- sents the present position of the Customs Service under the HTSUSA. If there are changes before the effective date of January 1, 1989, this advice may not continue to be applic- able.

Sincerely,

John Durant, Director
Commercial Rulings Division

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