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HQ 961935




September 25, 1998

CLA-2 RR:CR:GC 961935 PH

CATEGORY: CLASSIFICATION

TARIFF NOs.: 7013.39.20; 7323.93.00; 7323.91.50; 7323.99.90

Port Director
U.S. Customs Service
555 Battery Street
San Francisco, CA 94111
Laredo, Texas 78044

RE: Protest 2809-98-100091; spice rack and jars; glass; metal; chrome-plated; glassware used for kitchen purposes; kitchen articles of iron or steel; essential character; goods put up in sets for retail sale; GRI 3(b); ENs 70.23; Rule 3(b)(VIII); Rule 3(b)(X); Better Home Plastics Corp. v. United States; HQ 087727; NY 840647

Dear Port Director:

This is our decision on protest 2809-98-100091, against your classification under the Harmonized Tariff Schedule of the United States (HTSUS) of certain wire spice racks with glass jars.

FACTS:

The merchandise is invoiced as "WIRE SPICE RACK WITH 12-PC GLASS JARS". The invoice "unit price" is between $3 and $5. According to advertising literature provided with the protest, "[t]his chrome rack holds 12 glass bottles with chrome lids which are included in the set [and] [m]easures 13" x 5" x 7"." The illustration of the article shows a wire rack similar in construction to a sink drying rack in which are placed jars.

The entry was filed on September 8, 1997, with classification of the merchandise in subheading 7323.91.50, HTSUS. The entry was liquidated on March 6, 1998, with classification in subheading 7013.39.20, HTSUS. The importer's counsel filed this protest on April 28, 1998. The protestant states that the merchandise is more specifically provided for in subheading 7323.93.00, HTSUS, or, alternatively, in subheading 7323.91.50, HTSUS, than as liquidated. The protestant contends that the merchandise is classifiable as claimed by virtue of General Rule of Interpretation (GRI) 1 and/or 3(a), (b), and (c), as appropriate. The protestant also cites Harmonized Commodity Description and Coding System Explanatory Note (EN) 70.23 as supporting classification as claimed, in that the presence of the glass jars does not alter the character of the metal spice rack which retains its character as an article of iron or steel. The protestant contends that New York Ruling Letter (NY) 840647 dated May 19, 1989, as modified by Headquarters Ruling Letter (HQ) 087727 dated September 28, 1990, is not applicable to the merchandise because the rack and lids of the jars are chrome-plated in this case.

The HTSUS subheadings under consideration are as follows:

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: ... Other: Valued not over $3 each.

The 1997 general column one rate of duty for goods classifiable under this provision is 27.8% ad valorem.

7323.91.50 Table, kitchen or other household articles and parts thereof, of iron or steel; ...: ... Other: Of cast iron, not enameled: ... Other.

The 1997 general column one rate of duty for goods classifiable under this provision is 5.3% ad valorem.

7323.93.00 Table, kitchen or other household articles and parts thereof, of iron or steel; ...: ... Other: ... Of stainless steel.

The 1997 general column one rate of duty for goods classifiable under this provision is 2.6% ad valorem.

7323.99.90 Table, kitchen or other household articles and parts thereof, of iron or steel; ...: ... Other: ... Other: Not coated or plated with precious metal: ... Other.

The 1997 general column one rate of duty for goods classifiable under this provision is 3.4% ad valorem.

ISSUE:

Whether the spice rack with spice jars is classifiable as other glassware of a kind used for kitchen purposes in subheading 7013.39.20, HTSUS, or other kitchen articles of iron or steel in subheading 7323.91.50, 7323.93.00, or 7323.99.90, HTSUS.

LAW AND ANALYSIS:

Initially, we note that the protest was timely filed (i.e., within 90 days after but not before the notice of liquidation; see 19 U.S.C. 1514(c)(3)(A)) and the matter protested is protestable (see 19 U.S.C. 1514(a)(2) and (5)).

Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in accordance with the General Rules of Interpretation (GRIs). GRI 1 states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6. Pursuant to GRI 3(b), when goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows:

(b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a) [by reference to the heading which provides the most specific description], shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.

The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not legally binding on the contracting parties, and therefore not dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and are thus useful in ascertaining the classification of merchandise under the System. Customs believes the ENs should always be consulted. See T.D. 89-80, published in the Federal Register August 23, 1989 (54 FR 35127, 35128).

The spice rack and spice jars are goods put up in sets for retail sale. See EN Rule 3(b)(X), which provides that such sets must consist of at least two different articles which are, prima facie, classifiable in different headings (the rack is classifiable in heading 7323, HTSUS, and the jars are classifiable in heading 7013, HTSUS), consist of products or articles put up together to meet a particular need (i.e., storing spices), and are put up in a manner suitable for sale directly to users without repacking (for purposes of this ruling, we assume this to be true). Under GRI 3(b), classification of such sets is determined on the basis of the component which imparts the essential character.

Recently, there have been several Court decisions on "essential character" for purposes of GRI 3(b). Better Home Plastics Corp. v. United States, 916 F. Supp. 1265 (CIT 1996), affirmed 119 F.3d 969 (Fed. Cir. 1997), involved the classification of shower curtain sets, consisting of an outer textile curtain, inner plastic magnetic liner, and plastic hooks. Customs had classified the sets on the basis of the textile curtain under the "default rule of GRI 3(c)", after determining that neither the relative specificity test nor the essential character test was applicable (119 F.3d at 971). The CIT found that the plastic liner performed the indispensable function of keeping water inside the shower and therefore held that the plastic liner imparted the essential character upon the set. In its decision affirming the CIT decision, the CAFC stated:

The [CIT] carefully considered all of the facts, and, after a reasoned balancing of all the facts, concluded that Better Home Plastics offered sufficient evidence and argument to overcome the presumption of correctness. The court concluded that the indispensable function of keeping water inside the shower along with the protective, privacy and decorative functions of the plastic liner, and the relatively low cost of the sets all combined to support the decision that the plastic liner provided the essential character of the sets. ... The court's decision did not rely solely, or even hinge, on the indispensability of the water-retaining function. The decision was substantially based on the importance of the other functions as well as the cost of the entire set. [119 F.3d at 971]

Other decisions in which the Court looked primarily to the role of the constituent material in relation to the use of the goods to determine essential character include Mita Copystar America, Inc. v. United States, 966 F. Supp. 1245 (CIT 1997), motion for rehearing and reconsideration denied, 994 F. Supp. 393 (CIT 1998), and Vista International Packaging Co., v. United States, 19 CIT 868, 890 F. Supp. 1095 (1995). See also, Pillowtex Corp. v. United States, 983 F. Supp. 188 (CIT 1997), in which the Court found that, although GRI 3(b) could not be applied, if a GRI 3(b) analysis were performed, the essential character would be based upon the composite good's function.

Based on the foregoing, we conclude that in an essential character analysis for purposes of GRI 3(b), the role of the constituent materials or components in relation to the use of the goods is generally of primary importance, but the other factors listed in EN Rule 3(b)(VIII) should also be considered, as applicable. In this case, the "indispensable function" (Better Home Plastics, supra) of the set is to store spices. The glass jar component directly performs that function (i.e., spices are stored inside the jars), whereas the function of the stand is subsidiary, to hold the glass jars. The jars could store spices without the stand, but the stand could not store spices without the jars. Moreover, the other factors listed in EN Rule 3(b)(VIII), support the conclusion that the glass jar component establishes the essential character of the set. Insofar as quantity is concerned, there is one stand and there are 12 jars. Bulk and weight also appear to support the glass jar component as providing the essential character. In regard to value, we note that the stated value of the set is relatively small, and that in both Better Home Plastics decisions, the Court took note of value as a factor in the determination of essential character (see, in particular, 119 F.3d at 971, where the CAFC noted that the CIT had taken into consideration "the relatively low cost of the sets" combined with all the other relevant factors).

Accordingly, particularly on the basis of the recent Court decisions looking primarily to the role of the constituent materials or components in relation to the use of the goods in determining essential character, we conclude that the essential character of the merchandise is provided by the glass jar component. The merchandise is classified as other glassware of a kind used for kitchen purposes in subheading 7013.39.20, HTSUS (classification is in subheading 7013.39.20 and not subheading 7013.39.50, HTSUS, on the basis of the unit value of the component which provides the essential character of the set (i.e., the unit value of a single glass jar); see EN Rule 3(b)(X), last paragraph). We note that this is consistent with HQ 087727 dated September 21, 1997, modifying NY 840647 dated May 19, 1989. This conclusion is not inconsistent with EN 73.23, cited by the protestant (i.e., classification is in heading 7013, HTSUS, instead of heading 7323, HTSUS, not because the set is more specifically covered elsewhere or because the rack loses its character as an iron or steel article, but because the set cannot be classified by reference to GRI 3(a) and the components of the set are, prima facie, classifiable in different headings and, therefore, must be classified in accordance with GRI 3(b)).

HOLDING:

The spice rack with spice jars is classifiable as other glassware of a kind used for kitchen purposes in subheading 7013.39.20, HTSUS.

The protest is DENIED. 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, with the Customs Form 19, 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 the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the 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 the public via the Diskette Subscription Service, Freedom of Information Act, and other public access channels.

Sincerely,

John Durant, Director,

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