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August 13, 1996

HQ 958482


CLA-2 RR:TC:FC 958482 ASM

CATEGORY: CLASSIFICATION

TARIFF NO.: 3926.40.0000

Ms. Mary Ann Day
Import Department
Spearhead Industries, Inc.
Suite 502
401 Adams Ave.
Scranton, PA 18510

RE: Modification of HRL 555610 concerning the tariff classification of "Lite Stik Glowing Ghost Decoration"

Dear Ms. Day:

This letter concerns the modification of Headquarters Ruling Letter (HRL) 555610, dated February 1, 1991, in which you were advised of the classification of a "Lite Stik Glowing Ghost Decoration (Item No. 24100) under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). Pursuant to section 625, Tariff Act of 1930 (19 U.S.C. 1625), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. 103-182, 107 Stat. 2057, 2186 (1993) (hereinafter section 625), notice of the proposed modification of HRL 555610, was published July 3, 1996, in the Customs Bulletin, Volume 30, Number 27.

FACTS:

The subject article is known as a "Lite Stik Glowing Ghost Decoration." It consists of a plastic ghost decoration, made in China, and a 4-inch lite stick in a foil wrapper, made in the U.S. These articles are exported to Hong Kong where they are blister packaged together. The consumer uses this item by placing the glowing lite stick on top of a stand inside the ghost decoration.

In HRL 555610, dated February 1, 1991, this item was held to be classifiable under subheading 9505.90.6000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for "Festive, carnival or other entertainment articles, including magic tricks and practical joke articles; parts and accessories thereof: Other: Other."

ISSUE:

Whether the "Lite Stik Glowing Ghost Decoration" is properly classified as a "festive article" under heading 9505, HTSUSA, or under the provision for "Other articles of plastics" heading 3926 , HTSUSA.

LAW AND ANALYSIS:

Classification of merchandise under the 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 to the Harmonized Commodity Description and Coding System (EN's), 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.

Heading 9505, HTSUSA, includes articles which are for "Festive, carnival, or other entertainment purposes." The EN's to 9505, state 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.

Although the "Lite Stik Glowing Ghost Decoration" appears to function primarily as a decoration, we have determined that it does not meet the criteria established for classification as a "festive" article within subheading 9505.90, HTSUSA. The fact that the article is identified as a "ghost decoration" does not, in and of itself, convey the requisite association with Halloween. Ghosts and goblins are not particularly Halloween related since they often appear in mythology, movies or cartoons of no significance to Halloween.

This product is retail packaged consisting of two items: a plastic ghost and 4 inch lite stick in a foil wrapper which is intended to illuminate the ghost. The lite stick produces illumination by way of a cyalume chemical. The lite stick, if imported separately, would be classifiable under heading 3823, HTSUSA, which provides, in pertinent part, for "chemical products and preparations of the chemical or allied industries... not elsewhere specified or included." The EN's to heading 3823, HTSUSA, indicate that the preparations and chemical products of this heading include, inter alia:

(34) Articles producing a lighting effect by the phenomenon of chemiluminescence, e.g., lightsticks in which the lighting effect is obtained by a chemical reaction between oxalic acid type esters and hydrogen peroxide in the presence of a solvent and fluorescent compound.

GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRI's taken in order. Inasmuch as the product, as packaged, contains two items that may be classified under more than one heading, it is not classifiable pursuant to GRI 1. In this case, we regard the product for classification purposes as a composite good derived from the assembly of the two components, the ghost shell and the lite stick. See GRI 2(a). As a composite good, classification is determined according to GRI 3.

The text of GRI 3 provides, in pertinent part, that composite goods, made up of different components, shall be classified as if they consisted of the component which gives them their essential character. In this case, we regard the ghost component as providing the essential character of the article, following GRI 3(b) and its EN's. Therefore, our position as to which component, the ghost or the lite stick, provides the essential character has not changed from HRL 555610. However, our understanding of the correct scope of heading 9505 has changed, leading us to a different classification of the whole article.

The lite stick is intended to insert into the plastic ghost, thereby providing the plastic figurine with illumination when fully assembled. Thus, it is the plastic ghost which should govern classification of this product because the luminescent lite stick merely enhances the ghost. Further, the plastic ghost would continue to provide ornamentation after the light stick is consumed. Accordingly, the subheading which most specifically describes the assembled article is 3926.40.0000, HTSUSA, which provides for "Other articles of plastics... Statuettes and other ornamental articles." The EN's to heading 3926, provide that the heading covers articles, not elsewhere specified or included, of plastics (as defined in Note 1 to the Chapter) or of other materials of headings 39.01 to 39.14, including statuettes and other ornamental articles. Furthermore, we have already indicated that the lite stick would be classifiable in heading 3823, HTSUSA, if imported separately. When imported with the ghost, this product would not be precluded from classification under Chapter 39 pursuant to Legal Note 2(b), as a separate chemically defined organic compound classifiable under Chapter 29.

HOLDING:

The product identified as the "Lite-Stik Glowing Ghost Decoration" (Item No. 24100) is properly classifiable within subheading 3926.40.0000, HTSUSA, which provides for "Other articles of plastics and articles of other materials of headings 3901 to 3914: Statuettes and other ornamental articles." This provision is dutiable under the general column one rate at 5.3 percent ad valorem.

HRL 555610, dated February 1, 1991, is hereby modified. In accordance with section 625, this ruling will become effective 60 days after its publication in the Customs Bulletin. Publication of rulings or decisions pursuant to section 625 does not constitute change of practice or position in accordance with section 177.10(c)(1), Customs Regulations (19 CFR 177.10(c)(1)).

Sincerely,

John Durant, Director
Tariff Classification
Appeals Division

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