HQ 957960 - Protest 1401-95-100045; Candy filled jar; EN GRI 3(b); HRLs 957246, 956386, 956577, 955781, 0871280, 956368, 955857, 957327, 085326, 082954, 954479; NYRL 856591; T.D. 96-7, 61. Fed. Reg. 223,229 (January 3, 1996); Fontana Hollywood Corp. v. U.S., Group Italglass v. U.S., G. Heilman Brewing Co. v. U.S., U.S. v. Carborundum, Kraft Inc. v. U.S. - United States International Trade Commision Rulings

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HQ 957960

February 5, 1996

CLA-2 RR:TC:MM 957960 MMC

CATEGORY: CLASSIFICATION

TARIFF NO.: 1704.90.20; 7013.39.20

Port Director
U.S. Customs Service
200 Granby St.
Norfolk, VA 23510

RE: Protest 1401-95-100045; Candy filled jar; EN GRI 3(b); HRLs 957246, 956386, 956577, 955781, 0871280, 956368, 955857, 957327, 085326, 082954, 954479; NYRL 856591; T.D. 96-7, 61. Fed. Reg. 223,229 (January 3, 1996); Fontana Hollywood Corp. v. U.S., Group Italglass v. U.S., G. Heilman Brewing Co. v. U.S., U.S. v. Carborundum, Kraft Inc. v. U.S.

Dear Port Director:

The following is our response to Protest 1401-95-100045 concerning your actions in classifying and assessing duty on candy filled jars, under the Harmonized Tariff Schedule of the United States (HTSUS). Samples, as well as pictures of the subject articles, were submitted for our review. In preparing this ruling, consideration was given to supplemental submissions made by counsel on behalf of the protestant dated October 10 and 18, 1995, as well as arguments presented at a meeting on October 11, 1995, at Customs Headquarters.

FACTS:

The subject article consists of flavored hard candies packed in glass jars. The jars are made of clear glass and hold 750 milliliters, have mold seams, knurling, and a fired lip finish. Additionally, a molded, 2 digit number appears on the outer surface of the side of each jar and a paper label is glued to the jar which contains a brand name, product description, list of ingredients, and inventory bar code. Their matching glass lids have molded knobs that serve as handles to open and close the jars. In addition, a rubber gasket surrounds the outside bottom lip of the lid. When the lid is placed into the jar, it fits into the neck and body, creating a seal with the gasket. A decorative resealable bow is affixed between the jar and lid. The candy filled jars are imported on pallets covered with shrink wrap, which are purchased by mass merchandisers in the U.S. and then displayed and sold, in their condition as imported, at retail stores.

Protestant entered the candy filled jars under subheading 7010.90.50, HTSUS. The entries were liquidated on December 2, 1994, under subheading 7013.39.20, HTSUS. A protest was timely filed on March 2, 1995. The subheadings under consideration are as follows:

7010.90.50 Carboys, bottles, flasks, jars, pots, vials, ampoules and other containers, of glass, of a kind used for the conveyance or packing of goods; preserving jars of glass; stoppers, lids and other closures, of glass: Other containers (with or without their closures ) .........................................................Free

7013.39.20 Glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes (other than that of heading 7010 or 7018): Glassware of a kind used for table (other than drinking glasses) or kitchen purposes other than that of glass-ceramics:Other:Valued not over $3 each.... 28.5%

1704.90.20 Sugar confectionery (including whitechocolate), not containing cocoa, other, confections or sweet meats ready for consumption, other .........6.8%
ISSUE:

Is the candy filled jar classifiable as glass containers of a kind used for the conveyance or packing of goods, or as glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes? Is the candy classifiable separately or together with the jar?

LAW AND ANALYSIS:

The classification of merchandise under the HTSUS is governed by the General Rules of Interpretation (GRI's). GRI 1, HTSUS, states, in pertinent part, that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes. GRI 6 provides that for legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.

Protestant suggests that the candy and jar should be classified together under the provision for glass containers of a kind used for the packing and conveyance of goods or in the alternative, under the provision for candy. Protestant asserts that the article is a composite good or a set, and the candy provides the essential character of the whole.

In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, although not dispositive, or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See, T.D. 89-90, 54 Fed. Reg. 35127, 35128 (August 23, 1989). EN IX to GRI 3(b) , pg. 4, states, in pertinent part, that:

(IX) For purposes of this Rule, composite goods made up of different components shall be taken to mean not only those in which the components are attached to each other to form a practically inseparable whole but also those with separable components, provided these components are adapted one to the other and are mutually complementary and that together they form a whole which would not normally be offered for sale in separate parts.

EN IX to GRI 3(b) also sets forth two examples of articles regarded as composite goods:

1) Ashtrays consisting of a stand incorporating a removable ash bowl;

2) Household spice racks consisting of a specially designed frame (usually of wood) and an appropriate number of empty spice jars of suitable shape and size.

The EN to GRI 3(b) include as composite goods components which are attached to one another so as to form a whole, as well as those components which are separable so long as they are "mutually complementary," "form a whole" and would "not normally be offered for sale in separate parts." In determining whether the subject articles meet the definition of "composite good," we apply the criteria set forth in the EN to the candy and jar.

The candy and jar are not attached to one another. We must, however, further examine the merchandise to determine whether the articles are "mutually complementary," "form a whole" and whether the goods would "not normally be offered for sale in separate parts." With regard to the first criterion, this office has not been presented with substantiating evidence that the candy and jar are mutually complementary. The jar is not specially shaped or fitted to accommodate the candy. Rather, it is of a dimension similar to, and has the capacity to hold the sort of items typically stored or transported in jars described by the class or kind " glass storage jars" provided for under subheading 7013.99, HTSUS. For a further explanation of the class or kind "glass storage jars" See, T.D. 96-7, 61. Fed. Reg. 223,229 (January 3, 1996).

Protestant states that the candy and jar are mutually complementary to each other because they are intended to be used together. We do not agree. While, in this instance, these articles may be sold together, each functions independently of the other. The function of the candy as it relates to the jar is very different from the exemplars of composite goods set forth in the EN to GRI 3(b). The exemplars describe items that have no real function independent of one another e.g.: spice rack/jars and stand/ashtray. In this case, the candy and jar may be sold together, but they also have independent functions and are normally offered to the consumer separately. Headquarters Ruling Letter 957246, dated March 29, 1995, states that:

"the phrase would not normally be sold in separate parts' does not refer to how the components are actually marketed. Rather, it pertains to whether the components would normally or principally be sold independently of one another."

Candy is not normally sold with storage jars. Catalogs as well as retail displays indicate that, candy can be sold and packaged in a variety of ways, such as paper boxes, plastic bags, in bulk, individually wrapped pieces, etc. and that in a significant amount of instances, jars are sold to the consumer empty. We find this persuasive evidence that candy and jars are normally sold separately and, on this basis, Customs does not consider the subject merchandise to constitute a composite good for classification purposes.

In support of the contention that the subject articles are composite goods, protestant cites HRL 956386 dated July 7, 1994, and HRL 956577 dated April 17, 1995, which held, respectively, that a candle poured into a tin and a candle poured into a bail and trigger closure jar were classifiable together under the provision for candles. Although HRLs 956386 and 956577 appear similar to the subject merchandise, there are significant factors which distinguish their analysis and holdings. In both of the rulings, the candle, in hot wax form, was poured into the container where it took on that container's shape as it cooled. Once it took on the container's shape, it was no longer removable from the container and therefore, incapable of an independent use. This same principle applies to HRL 955781 dated April 26, 1994, HRL 087280 dated July 16, 1990, and HRL 086344 dated July 5, 1990. All of these ruling determined that various types of clothing with carrying bags were composite goods because the bags did not have an independent use. See also HRL 956368 dated July 7, 1994, holding a glass bottle and its wooden "cradle" to be a composite good.

The distinguishing feature between the "containing" articles in each of the cited cases and the jar in this case, is that this type of jar is usually sold separately. This distinction controls whether components are composite goods or not. See HRL 955857 dated August 11, 1994, classifying non-removable potpourri in a jar as a composite good.

Finally, Protestant asserts that articles imported with food are classifiable under the respective food provision. As support for this assertion, Protestant cites New York Ruling Letter (NYRL) 856591 dated October 4, 1990, which classified butter cookies in a metal tin that played music when opened under the provision for butter cookies. The ruling provides only a general description of the article and no analysis concerning the classification. Therefore, Customs finds it unpersuasive.

Protestant submits that the subject merchandise may be considered "goods put up in sets for retail sale" and cites to HRL 085326 dated September 22, 1989, HRL 082954 dated December 20, 1989, and HRL 954479 dated October 6, 1993, all of which classified liquor accompanied by glasses as sets for retail sale. EN X to GRI 3(b) provides, in pertinent part, that:

For purposes of this Rule, the term goods put up in sets for retail sale' shall be taken to mean goods which:

(a) consist of at least two different articles which are, prima facie, classifiable in different headings;

(b) consist of products or articles put up 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.

However, unlike the liquor and glasses rulings cited above, the candy and jar are not goods that consist of products or articles put up together to meet a particular need or carry out a particular activity. There is no affinity between the candy and the jar. Although the jar in this instance acts as a holder for the candy, its normal function is to act as an all purpose general household storage jar. Consequently, as the candy and glass jar do not meet the requirement of part (b), they do not compromise a "set" within the meaning of GRI 3(b). For further analysis, see HRL 957327 dated February 13, 1995, holding that a coffee mug and candy did not meet the GRI 3(b) set requirement.

Protestant suggests that classification of the candy filled jar is governed by GRI 5(b). We disagree. GRI 5(b) states:

(b) Subject to the provisions of rule 5(a)..., 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 is not binding when such packing materials or packing containers are clearly suitable for repetitive use.

Rule 5(b) requires packing materials entered with the goods to be classified with those goods if the packing materials are of a kind normally used for packing of such goods.

The Customs Court, in Fontana Hollywood Corp. v. United States, 64 Cust. Ct. 204 (1970) (Fontana), determined that a gallon cammelloni bottle, standing four feet tall with an elongated tube-like neck extending three feet from the conical bottom part dressed in raffia, imported filled with wine was, for General Headnote 6(b) purposes, an "unusual" bottle subject to tariff treatment as an imported article separate from the wine content. Congress has indicated that earlier tariff decisions must not be disregarded in applying the HTSUS. The conference report to the Omnibus Trade Bill of 1988, states that "on a case-by-case basis prior decisions should be considered instructive in interpreting the HTS[US], particularly where the nomenclature previously interpreted in those decisions remains unchanged and no dissimilar interpretation is required by the text of the HTS[US]." H. Rep. No. 100-576, 100th cong., 2d Sess. 548, 550 (1988). General Headnote 6(b) of the Tariff Schedules of the United States (TSUS), is the predecessor to GRI 5(b) HTSUS.

In Fontana, the court determined that a bottle can be found "unusual"/ not of a kind normally used for the packing of such goods, on any number of grounds. The court further stated that proof that imported bottles containing wine are not designed for, or capable of reuse, and are sold at retail with their contents, is insufficient to overcome the presumption that they are otherwise unusual bottles, subject to separate tariff treatment as imported articles. Finally, the court stated that even if a container was found to be chiefly used for the packing, transportation or marketing of wine, that finding would not be inconsistent with the fact that it is "unusual", i.e., of a kind not usually or ordinarily employed to ship, transport, or market wine. Like the wine bottle, the storage jars are not usually or ordinarily employed to ship, transport, or market candy. This belief is strengthened by protestant's lack of evidence to the contrary. Candy is generally sold in bulk, individually wrapped or packaged in boxes or bags.

Protestant suggests that subheading 7010.90.50, HTSUS, which provides, in pertinent part, for containers of a kind used for the conveyance or packing of goods, describes the jar component of the article, not subheading 7013.39.20, HTSUS, which provides, in pertinent part, for the class or kind "glass household articles". We disagree.

Both subheadings 7010.90.50 and 7013.39.20, HTSUS, are use provisions. There are two principal types of classification by use:

(1) according to the actual use of the imported article; and

(2) according to the use of the class or kind of goods to which the imported article belongs.

Use according to the class or kind of goods to which the imported article belongs is more prevalent in the tariff schedule. A few tariff provisions expressly state that classification is based on the use of the class or kind of goods to which the imported article belongs. In Group Italglass U.S.A. v. U.S., USITR, 17 CIT ____, Slip Op. 93-46 (Mar. 29, 1993), the CIT held that: "the language in heading 7010, "of a kind used for" explicitly invokes use as a criterion for classification and in heading 7010, principal use is controlling."

As subheadings 7010.90.50 and 7013.39.20, HTSUS, contain the language "of a kind used for" the principal use of a particular article will determine whether it belongs to one of the classes or kinds described by heading 7010, or heading 7013.

When an article is classifiable according to the use of the class or kind of goods to which it belongs, Additional U.S. Rule of Interpretation 1(a), HTSUS, provides 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 U.S. 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. In other words, the article's principal use at the time of importation determines whether it is classifiable within a particular class or kind.

While Additional U.S. Rule of Interpretation 1(a), HTSUS, provides general criteria for discerning the principal use of an article, it does not provide specific criteria for individual tariff provisions. However, the U.S. Court of International Trade (CIT) has provided factors, which are indicative but not conclusive, to apply when determining whether particular merchandise falls within a class or kind. They include: general physical characteristics, the expectation of the ultimate purchaser, channels of trade, environment of sale (accompanying accessories, manner of advertisement and display), use in the same manner as merchandise which defines the class, economic practicality of so using the import, and recognition in the trade of this use. See: Kraft, Inc, v. U.S., USITR, 16 CIT 483, (June 24, 1992)(hereinafter Kraft); G. Heilman Brewing Co. v. U.S., USITR, 14 CIT 614 (Sept. 6, 1990); and U.S. v. Carborundum Company, 63 CCPA 98, C.A.D. 1172, 536 F. 2d 373 (1976), cert. denied, 429 U.S. 979.

Because both subheadings 7010.90.50 and 7013.39.20, HTSUS, are use provisions, Additional U.S. Rule of Interpretation 1(a), HTSUS, applies. This necessitates the application of the Kraft characteristics to the subject glassware. Application of the characteristics will determine to which class or kind the article belongs; indoor decoration or packing or conveying containers. Customs is of the opinion that the physical characteristics of the subject article, as well as the manner in which it is used, prevents it from being described by subheading 7010.90.50, HTSUS. As a general rule, a glass article's physical form will indicate its principal use and thus to what class or kind it belongs. Should, however, an exception arise and an article's physical form does not indicate to what class or kind it belongs or its physical form indicates it belongs to more than one class or kind, Customs considers the other enumerated principal use criteria.

The physical characteristics, the fact that the subject articles while not by this importer, are nonetheless sold empty in the retail market as well as the fact that they are not used in the same manner as is defined for the class, indicates that the subject glass jars do not belong to the class "containers for the packing and conveying of goods" in heading 7010, HTSUS.

The subject jars have a fired lip finish rather than a standard conveyance finish, lids with knob handles molded in them and a "rubber seal" that fits into the neck of the jar and seals in freshness. This seal also allows for repetitive, extremely easy, opening and closing of the jar, and is a feature which clearly indicates reusability. In contrast, containers belonging to this class usually have a threaded or beaded finish, and lids without handles molded into them. Jars with the same physical characteristics are sold empty at retail outlets for ultimate purchasers to reuse in the home.

Finally, the manner in which containers belonging to the class "containers of a kind used for the conveyance and packing of goods" are principally used, is to convey a product to the consumer who uses the product in the container and then discards the container. The glass jars at issue are not the kind of container generally used to commercially convey candy. Paper/plastic bags or boxes, bulk storage bins, and individual wrappings are more commonly used to commercially convey candy. Additionally, the glass jars are not merely used as containers to convey the candy to the consumer who then discards the jar but they also serve display, and disbursing purposes when filled. Therefore, the jars are described by subheading 7013.39.20, HTSUS.

The candy filled jar is not classifiable as a composite good or a set in accordance with GRI 3, nor as packaging in accordance with GRI 5. Candy and jars are normally sold separately and they do not serve to carry out a single activity. Accordingly, the components are to be classified separately. The candy is classifiable under subheading 1704.90.20, HTSUS, as sugar confectionery (including white chocolate), not containing cocoa, other, confections or sweet meats ready for consumption, other. The glass jar is classifiable under subheading 7013.39.20, HTSUS, as glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes (other than that of heading 7010 or 7018): glassware of a kind used for table (other than drinking glasses) or kitchen purposes other than that of glass-ceramics:other:valued not over $3 each.

HOLDING:

The protest should be DENIED. The components are to be classified separately. The candy is classifiable under subheading 1704.90.20, HTSUS, as sugar confectionery (including white chocolate), not containing cocoa, other, confections or sweet meats ready for consumption, other with a column on duty rate of 6.8 % ad valorem. The glass jar is classifiable under subheading 7013.39.20, HTSUS, as glassware of a kind used for table, kitchen, toilet, office, indoor decoration or similar purposes (other than that of heading 7010 or 7018) glassware of a kind used for table (other than drinking glasses) or kitchen purposes other than that of glass-ceramics:other:valued not over $3 each with a column one duty rate of 28.5 % ad valorem.

In accordance with section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed by your office to the Protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with this decision must be accomplished prior to the mailing of the decision. Sixty days from the date of this decision, the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS and to the public via the Diskette Subscription Service, Freedom of Information Act and other public access channels.

Sincerely,

John Durant, Director
Tariff Classification and

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