HQ 0081095 - Tariff classification of moon boots - United States International Trade Commision Rulings

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HQ 081095

July 21, 1988

CLA-2 CO:R:C:G 082095 DSN

CATEGORY: CLASSIFICATION

TARIFF NO.: 700.5700

Mr. Keith Burdette
K.C. Burdette Company, Inc.
45 John Street, Suite 801
New York, New York 10038

RE: Tariff classification of moon boots

Dear Mr. Burdette:

This is in response to your inquiry of January 14, 1988, in which you requested tariff classification under the Tariff Schedules of the United States Annotated (TSUSA), and the Harmonized Tariff Schedule of the United States Annotated (HTSUSA), for seven products from Korea on behalf of Hi-Grade System Corp. Classification of six of the items was provided by our New York office. The remaining item, a moonboot, was submitted for examination to determine classification under the TSUSA only.

FACTS:

The sample, labelled number six, has an outer surface of woven fabric with a layer of non-transparent polyurethane plastic. The coated fabric is considered to be wholly of rubber or plastic. The inside of the fabric is bonded to a layer of foam plastic which is bonded on the other side to an open mesh tricot fabric. The bottom insole is sewn to the upper. The moonboot features a bootie-liner which is also sewn to the upper. The bootie-liner is composed of a foam plastic core bonded on the outside to a open mesh tricot fabric, and is bonded on the inside to a woven fabric. We do not know how the article will be completed, but we assume either by a one-color molded bottom or by a two-color molded bottom.

ISSUE:

Whether the article is unfinished footwear, and if so, is the method of completion relevant for classification purposes.

LAW AND ANALYSIS:

General Interpretative Rule 10(h) TSUSA, provides that a tariff description for an article covers such article, whether assembled or not assembled, and whether finished or not finished. A leading case interpreting 10(h) with respect to whether an article is unfinished, is Daisy-Heddon, Div. Victor Comptometer Corp. v. United States, 66 CCPA 97, C.A.D. 1228 (1979). The court listed five factors to help determine whether an article should be considered unfinished for tariff purposes. The five factors are as follows:

1. Comparison of the number of omitted parts with the number of included parts;

2. comparison of the time and effort required to complete the article with the time and effort required to place it in its imported condition;

3. comparison of the cost of the included parts with that of the omitted parts;

4. the significance of the omitted parts to the overall functioning of the completed article; and

5. trade customs, i.e., does the trade recognize the importation as unfinished article or as merely part of the article.

The court recognized that these factors are merely guidelines and that fewer than all the above factors, or additional factors may come into play depending on the particular merchandise.

With respect to factor number one, this merchandise consists of three parts; the upper, bootie-liner, and a bottom. The part that is omitted to fully complete the article is the molded bottom. However, the merchandise is still recognizable as a boot, having an upper and a closed bottom that covers the entire foot.

We do not have the relevant information to address factors two and three. With respect to factor four, the significance of the omitted part, namely the type of molded bottom, is important to the overall functioning of the completed footwear but not in determining whether the article is substantially complete, because the complete upper with a full bootie-liner has been processed to the point of being identified as a boot.

An article is unfinished if it has been so far processed toward its ultimate completed form as to be dedicated to the making of that article. American Import Co. v. United States, 26 CCPA 72, TD 49612 (1938).

The above case was cited as authority in T.D. 86-144, which dealt with the issue of whether duck-type footwear was considered unfinished. We held that the duck-type footwear in its imported condition was substantially complete footwear because it was so far processed as to be dedicated to the making of a class of articles alone, namely, footwear. In that case, the duck-type footwear upper needed to be stitched and in some instances an insole inserted. In the instant case, the article has a full bootie-liner but lacks the molded bottom. We believe that the above case and the instant case are similar, in that both articles are substantially complete, because they give the overall visual impression of finished footwear, despite their omissions. As previously stated, the instant merchandise has the shape and look of a boot with an upper and a closed bottom that covers the foot. Therefore, applying Daisy-Heddon, classification of this article would be as unfinished footwear. We note that with respect to factor five, there is no consensus in the trade as to what constitutes unfinished footwear.

Having established that the merchandise is to be treated as unfinished footwear, we look to various methods of completion in order to determine classification. The article may be completed by applying either a one or a two color molded rubber bottom. If a one color molded bottom is applied, classification would be under item 700.5600 TSUSA. If a two color molded bottom is applied, we must consider the possibility of a foxing-like band being present. In such a case, classification would be under item 700.5700 TSUSA. General Interpretative Rule 10(d), states that if two or more tariff descriptions are equally applicable to an article, such article shall be subject to the duty under the description for which the original statutory rate is highest. The orginial statutory duty rate is determined by looking at column two in the tariff. Item 700.5600 has an original statutory rate of 35 percent ad valorem. Item 700.5700 has an original statutory rate of 66 percent ad valorem. Since item 700.5700 has the highest duty rate, that provision is applicable.

HOLDING:

In view of the foregoing, the moonboots are properly classified under the provision for footwear which is over 50 percent by weight of rubber or plastics or over 50 percent by weight of fibers and rubber or plastics with at least 10 percent by weight being rubber or plastics, other footwear designed to be worn over, or in lieu of, other footwear as a protection against water, oil, grease, or chemicals or cold or inclement weather, item 700.5700 TSUSA, dutiable at the rate of 37.5 percent ad valorem.

Sincerely,

John Durant, Director

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