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HQ 089956


May 11, 1992

CLA-2 CO:R:C:F 089956 STB

CATEGORY: CLASSIFICATION

TARIFF NO.: 9503.90.5000

District Director of Customs
P.O. Box 619050
1205 Royal Lane
Dallas, Texas 75261

RE: Decision on Application for Further Review of Protest No. 5501-90-100482, filed July 26, 1990, concerning the classification of metallic balloons.

Dear Sir:

This is a decision on a protest filed July 26, 1990, against your decision on the classification and liquidation of twenty- nine (29) different entries of metallic balloons that were made between the dates of July 7, 1989 and February 23, 1990. The entries were all liquidated on April 27, 1990.

FACTS:

You classified the subject metallic balloons in subheading 9503.90.5000, Harmonized Tariff Schedule of the United States (HTSUSA), the provision for other toys, other, other, inflatable toy balls, balloons and punch balls. The applicable duty rate for that provision is 6.8 percent ad valorem. Protestant claims that the merchandise should be classified under subheading 9505.90.6000, HTSUSA, the provision for festive, carnival or other entertainment articles, other, other, dutiable at 3.1 percent ad valorem.

The balloons in question are described by the protestant as "aluminum-coated mylar envelopes of various shapes and sizes." They are sold at the retail level for a variety of uses but, according to the importer, they are primarily marketed as greetings and as decoration for festive occasions. The importer's submission states that the subject merchandise consists of aluminum-coated mylar envelopes imprinted with such legends as "Happy Birthday" and "Happy Anniversary" while others display stylized drawings of licensed characters such as Garfield and Snoopy. Counsel for the importer stated in a meeting with

Customs Headquarters personnel that the importer does not possess the rights to licensed characters such as Garfield, and therefore invents its own characters but concentrates mostly on festive and greeting themes. A review of the entries under protest indicates many types of balloons, including balloons described as "Welcome Back" balloons, "Thank You" balloons, "Be My Valentine" balloons, "Teddy Beddy Boy" balloons, and plain, red balloons. The three samples that were submitted to Customs all convey Christmas/Holiday related messages and are predominantly decorated in Christmas related colors. Counsel also stated that the aluminum construction of this merchandise helps the items maintain inflation for a long period of time and thus sets them apart from latex balloons.

ISSUE:

Whether the subject merchandise should be classified under subheading 9503.90.5000, HTSUSA, the provision for balloons or under subheading 9505.90.6000, HTSUSA, the provision for festive, carnival or other entertainment articles?

LAW AND ANALYSIS:

Classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) is made in accordance with the General Rules of Interpretation (GRI's). The systematic detail of the harmonized system 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 GRI's may then be applied. The Explanatory Notes (EN's) to the Harmonized Commodity Description and Coding System, which represent the official interpretation of the tariff at the international level, facilitate classification under the HTSUSA by offering guidance in understanding the scope of the headings and GRI's.

The protestant has claimed classification in heading 9505, HTSUSA. Heading 9505 provides, in pertinent part, for "[f]estive, carnival or other entertainment articles." The EN's to heading 9505 indicate that the heading covers:

(A) Festive, carnival or other entertainment articles which in view of their intended use are generally made of non-durable material. They include:

(1) Decorations such as festoons, garlands,

Chinese lanterns, etc., as well as various decorative articles made of paper, metal foil, glass fibre, etc., for Christmas trees (e.g., tinsel, stars, icicles), artificial snow, coloured balls, bells, lanterns, etc. Cake and other decorations (e.g., animals, flags) which are traditionally associated with a particular festival are also classified here.

(2) Articles traditionally used at Christmas festivities, e.g., artificial Christmas trees (these are sometimes of the folding type), nativity scenes, Christmas crackers, Christmas stockings, imitation yule logs.

Articles classifiable in heading 9505, HTSUSA, tend to have no function other than decoration.

Heading 9505 is generally regarded as a use provision. Consequently, Additional U.S. Rule of Interpretation 1(a) must be reviewed. That rule indicates that:

In the absence of special language or context which otherwise requires--
(a) a tariff classification controlled by use (other than actual use) is to be determined in accordance with the use in the United States at, or immediately prior to the date of importation, of goods of that class or kind to which the imported goods belong, and the controlling use is the principal use.

It is our determination that this merchandise is not classified in heading 9505, HTSUSA. The various items that are the subject of this protest display different motifs, including not only Christmas and other holiday related themes but also general greeting motifs and "themeless" motifs that could be considered cute, humorous, or amusing, but are not related to any specific festive occasion or greeting. Some of the balloons have no message or picture. Regardless of motif, however, these items are basically balloons. Balloons, as a class or kind of merchandise, are not "traditionally associated with a particular holiday" as required by the EN's; they are sold year-round in a variety of motifs, as illustrated by the variety of balloons that are the subject of this protest. Additionally, balloons are not "traditionally used at Christmas festivities", also mentioned by the EN's as a possible mode of inclusion in heading 9505, HTSUSA.

The protestant discusses several prior Customs rulings in which various items were classified as festive articles in heading 9505, HTSUSA, and argues that these rulings are analogous to the current protest. Examination of those rulings, however, reveals that the merchandise discussed therein can be readily distinguished from the balloons presently considered.

We next consider classification in heading 9503, HTSUSA, and specifically in subheading 9503.90.5000, HTSUSA, which provides eo nomine for "Other toys...Inflatable toy balls, balloons and punchballs." The EN's to Chapter 95 indicate that "this chapter covers toys of all kinds whether designed for the amusement of children or adults." The phrase "designed for the amusement of" is generally understood to indicate the use of an article will be a factor when classification in Chapter 95 is being considered. We again refer to Additional U.S. Rule of Interpretation 1(a), supra. It is our determination that balloons as a class or kind of merchandise, as well as the particular balloons at issue here, are indeed designed for the amusement of children or adults and that obtaining amusement is the principal use of this merchandise.

As described above, many of the subject balloons have no greeting or festive related message/picture and thus have little use other than amusement. The balloons that do display such messages and pictures are not transformed from their basic status as balloons. The protestant contends that the balloons are indeed transformed by the printed material in those instances and cites Headquarters Ruling Letter (HRL) 086745, dated July 3, 1990, in which Customs classified a plastic, business-like card as "other printed matter" rather than as a toy. That merchandise consisted of a piece of plastic resembling a credit card in size and composition. One side of the card contained information similar to that found on a business or calling card. The other side of the card contained a temperature and pressure sensitive thumb-print size square of plastic sheeting, for use as a novelty device to "measure" body temperature to determine stress, tenseness, etc. Customs determined that "the printed information on the cards provides the essential purpose and use for the goods" and that the "stress-test" is just a gimmick to draw attention to the cards.

HRL 086745 can be distinguished from the present matter, however, in that the plastic cards described in that ruling would have little value were it not for the printed messages that could be displayed thereon. Balloons, on the other hand, have a well known and established use for amusement purposes regardless of the message or picture displayed. This distinction is supported in two prior Customs rulings, HRL 062114, dated April 12, 1979,
and New York Ruling (NY) 814645, (1985). These rulings held that various balloons, although imprinted with advertising messages, were nevertheless classified in the TSUSA provision for toys. Although the rulings were based on the TSUSA language, it is very similar to the language of the present EN. We thus conclude that the messages and pictures displayed on a portion of the subject balloons do not remove the merchandise from classification as balloons in the toy provision. This question does not arise, of course, in the consideration of the plain balloon entries. As for the balloons that display only some type of cute character, their amusement value, and thus their identity as a toy, is increased by the picture.

HOLDING:

The metallic balloons are classified in subheading 9503.90.5000, HTSUSA, the provision for other toys, other, other, inflatable toy balls, balloons and punchballs, dutiable at the column 1 rate of duty of 6.8 percent ad valorem.

The protest should be denied. A copy of this decision should be attached to the Form 19 to be returned to the protestant.

Sincerely,

John Durant, Director

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