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HQ 963638




November 2, 2001

CLA-2 RR:CR:GC 963638 JGB

CATEGORY: CLASSIFICATION

TARIFF NO.: 4202.32.9550

Mr. Joel K. Simon
Serko & Simon, LLP c/o Baker & Hostettler
666 5th Ave., 16th Floor
New York, NY 10103

RE: Rugrats™ Novelty Coin Purse, Style H51147

Dear Mr. Simon:

This is in reference to your letter of October 18, 1999, to the Customs National Commodity Specialist Division, New York, on behalf of Worldwide Dreams, LLC, and its division, East End Accessories, in which you request a classification ruling, under the Harmonized Tariff Schedule of the United States (HTSUS), of a novelty coin purse. We regret the delay in responding.

The samples, all designated as Style H51147, are described as miniature representation of "Angelica," "Tommy", "Chuckie", and "Reptar" figures from the television show "Rugrats." The items measure approximately 7 inches in height. A zipper measuring approximately 1-¾ inches in "Angelica", 2-½ inches in "Tommy" and "Chuckie" and 3 inches long in "Reptar" secures a cavity large enough to hold coins, some folded bills, keys, or other "treasures." According to the "Rugrat" design, the heads are disproportionately larger than the bodies. At the top of each of the human figures' head is a sturdy textile loop on which is attached a metal 7-link chain which is, in turn, attached to a metal split ring that has a small safety clasp attached to it. The safety clasp allows the article to be attached to a belt loop, backpack, etc. The "Reptar" figure, the only non-human in the group, has a similar attachment at the back of its head. The coin purses, generally, have an exterior surface of 100 percent polyester plush fabric with a textile interior lining. Minor deviations exist in the "Tommy" model because the figure wears "training pants" of textile material coated with a shiny plastic material.

ISSUE:

Whether the article is a novelty coin purse under heading 4202, HTSUS, or is a stuffed doll of heading 9502, or a toy representing animals or non-human creatures, under heading 9503, HTSUS?

LAW AND ANALYSIS:

Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRI). GRI 1 provides that the classification of goods shall be determined 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 may then be applied.

The following HTSUS provisions are under consideration:

Heading 4202, HTSUS, provides for:

Trunks, suitcases, vanity cases, attache cases, briefcases, school satchels, spectacle cases, binocular cases, camera cases, musical instrument cases, gun cases, holsters and similar containers; traveling bags, toiletry bags, knapsacks and backpacks, handbags, shopping bags, wallets, purses, map cases, cigarette cases, tobacco pouches, tool bags, sports bags, bottle cases, jewelry boxes, powder cases, cutlery cases and similar containers, of leather or of composition leather, of sheeting of plastics, of textile materials, of vulcanized fiber or of paperboard, or wholly or mainly covered with such materials or with paper.

Heading 9502, HTSUS, provides for "Dolls representing only human beings and parts and accessories thereof."

Heading 9503, HTSUS, provides for "Other toys; reduced–size (“scale”) models and similar recreational models, working or not; puzzles of all kinds; parts and accessories thereof:."

Legal Note 1(l) to Chapter 42 excludes articles of Chapter 95 such as toys, games or sports equipment. Similarly, Legal Note 1(d) to Chapter 95 excludes sports bags or other containers of heading 4202, HTSUS. Two legal notes such as these do not mutually exclude each other, but rather instruct that classification be made in the one chapter that properly includes the article under consideration. See Headquarters Ruling Letter (HQ) 088665, dated June 14, 1991, and Avenues in Leather v. United States, 11 F. Supp. 2d 719 (CIT 1998), affirmed, 178 F.3d 1241 (CAFC 1999). Accordingly, we must determine whether Chapter 42 or Chapter 95 as either doll or toy properly includes the article under consideration.

The Harmonized Commodity Description and Coding System, Explanatory Notes (EN), represent the official interpretation of the Harmonized System at the international level and facilitate classification under the HTSUS by offering guidance in understanding the scope of the headings and GRI. The EN, although not dispositive or legally binding, provide a commentary on the scope of each heading of the HTSUS, and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).

There would be no question that the instant samples would be classified either in the doll provision, heading 9502 for "Angelica", "Tommy" and "Chuckie" and in the toy provision for "Reptar", if they did not incorporate a functional pouch for coins, bills, and the like. This decision is concerned with the change in classification occasioned by the inclusion of the zippered pouch.

The EN for heading 9502 state that the “heading includes not only dolls designed for the amusement of children, but also dolls intended for decorative purposes (e.g., boudoir, dolls, mascot dolls).” As stated, infra, the "Rugrat" figures besides "Reptar", do not provide the principal function of the article. With inclusion of the pouch and zipper, Customs cannot ignore its apparent purpose and is forced to conclude that the principal use of the would-be doll articles is neither the amusement of children nor the decorative purposes listed in the EN.

Although the term "toy" is not defined in the tariff, the EN to chapter 95, HTSUS, states, in pertinent part, that "this Chapter covers toys of all kinds whether designed for the amusement of children or adults." Although not set forth as a definition of "toys", this term has been interpreted by Customs as equating "toys" with articles "designed for the amusement of children and adults."

In the tariff context, "amuse" is mainly used in contrast to some utilitarian or functional quality and the focus is not how the toys are used, but whether they are designed to amuse. It has been Customs position that the "amusement" requirement means that a toy should be designed and used principally for amusement and should not serve a utilitarian purpose. In this case, the utilitarian function of both the would-be dolls and toy is not merely incidental. Instead, the manufacturer expended additional cost and effort to construct the articles so that they have a pouch with a zipper, and so that they can be easily carried by a young child by means of the safety clasp.

While the comical features of the “Rugrats” are entertaining, as constructed and offered for sale, they have little play value. Moreover, “Customs has ruled on several occasions that articles having toy like features such as animal shapes are not classified as toys, but in provisions that recognized their use as functional items despite a novelty appearance (for example, backpacks and sleeping bags).” HQ 088665, dated June 14, 1991.

In HQ 088665, Customs ruled that a “Wrist Rascal” was a novelty coin purse classifiable under heading 4202, HTSUS. The “Wrist Rascal” was a full-figured representation of a baby chick worn on the wrist which primarily functioned as a key-case or coin purse. Customs found that the “Wrist Rascal” was not a toy because it was not used for the amusement of children or adults, but rather as a container to carry personal items that had ornamental features. Like the “Wrist Rascal,” the primary function of the "Rugrats" coin purses is to serve as a container to carry personal items. The pouch is sufficiently large to function for the young age group at which the articles are marketed.

Customs rulings on similar merchandise guides the result in this case. In HQ 950752, dated January 9, 1992, Customs considered whether a stuffed animal that had a sealable compartment and that could be worn as a backpack, was a toy or a backpack. Customs reasoned:

Although the whimsical characters are designed to appeal to children, the presence of a functional compartment, shoulder straps and hook and loop closures indicate an intent for use as a carrying case, a use which characterizes the article at issue. The compartment which forms the animal body is functionally relevant and capable of use by a small child for the storing of small toys or supplies.

The primary function of the articles under consideration, like that of the stuffed animal backpack, is to act as a container for personal items of a small child, e.g., coins, bills, and keys. Like the stuffed animal backpack, the whimsical nature of the “Rugrat” characters is designed to appeal to children, but is outweighed by the item’s utility.

In support of your arguments, you cite NY C89828, dated July 9, 1998. That ruling involved the classification of a "Teletubby" attached to a keychain. However, unlike the instant article, the "Teletubby" had a “insignificant storage/coin compartment" also characterized as a ""tiny cavity" and consequently it functioned more as a toy than as a container to carry personal items. Customs has ruled that the small carrying capacity of a pouch, due to small size or overstuffing, will reduce the utilitarian value of the item. See, HQ 964737, dated January 4, 2001, (ruling that the small flat pocket on a “Hello Kitty” keychain was insufficient to find that the primary use was that of a novelty coin purse); and HQ 962670, dated April 20, 1999 (ruling that the small pocket on a “Rugrats” doll did not provide sufficient space to find that the article’s primary use was that of a “novelty backpack.”) Unlike those items, the pouch of the instant article is large enough so that its utilitarian value is not diminished.

This ruling is consistent with prior rulings on similar articles. See NY D83544, dated February 1, 1999 ("Grinch" with a 2-¾” pouch sewn into the back is a coin purse); NY E80540, dated April 20, 1999 (plush duck with a zippered pocket measuring approximately 3-¾” by 2-½” sewn into the back is a coin purse); and PD D86561, dated February 4, 1999, (6” stuffed animal with pouch and keychain is a coin purse).

The instant articles present useable and functioning pouches that are useful in carrying personal items. Consequently they are classifiable in subheading 4202.32.9550, HTSUS, which provides for "other articles of a kind normally carried in the pocket or handbag."

HOLDING

The Rugrats™ Novelty Coin Purse, Style H51147 is classified under subheading 4202.32.9550, HTSUSA, textile category 670, which provides for “Trunks, suitcases . . . knapsacks and backpacks, . . . wallets, purses, of textile materials . . .: Articles of a kind normally carried in the pocket or in the handbag: With outer surface of sheeting of plastic or of textile materials: With outer surface of textile materials: Other: Other, Of man-made fibers."

The designated textile and apparel category may be subdivided into parts. If so, visa and quota requirements applicable to the subject merchandise may be affected. Since part categories are the result of international bilateral agreements which are subject to frequent negotiations and changes, we suggest that the importer check, close to the time of shipment, the Status Report On Current Import Quotas (Restraint Levels), an issuance of the U.S. Customs Service, which is updated weekly and is available at the local Customs office.

Due to the changeable nature of the statistical annotation (the ninth and tenth digits of the classification) and the restraint (quota/visa) categories, the importer should contact the local Customs office prior to importing the merchandise to determine the current status of any import restraints or requirements.

Sincerely,

John Durant, Director Commercial Rulings Division


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