Ceramic tableware, of porcelain or china, used in the rental industry; heading 6911, ceramic household tableware, of porcelain or china, versus ceramic hotel and restaurant tableware and other non-household tableware, of porcelain or china; HQ 082780; principal use, class or kind; Carborundum factors

HQ 959745 July 20, 1998 CLA-2 RR:CR:GC 959745 JRS CATEGORY: Classification TARIFF NO.: 6911.10.10 Ms. Marilyn-Joy Cerny Global Customs & Trade Specialists, Inc. Milltown Office Park - Suite B-202 Route 22 Brewster, New York 10509 RE: Ceramic tableware, of porcelain or china, used in the rental industry; heading 6911, ceramic household tableware, of porcelain or china, versus ceramic hotel and restaurant tableware and other non-household tableware, of porcelain or china; HQ 082780; principal use, class or kind; Carborundum factors Dear Ms. Cerny: This is in response to your letter dated May 22, 1996, requesting a ruling on behalf of Seneca-Delco Corporation, concerning the classification of ceramic tableware intended to be used in the tableware rental industry. We have taken into consideration additional information presented at the meeting held on January 8, 1997, and your further submissions dated January 16, May 15, and June 11, 1997, which present information on a GSA institutional standard for white, restaurant-grade, china dinnerware. We regret the delay in responding. FACTS: Seneca-Delco (hereinafter, SD) imports tableware designed exclusively for institutional use and sold expressly and exclusively to institutional buyers such as restaurants, hotels, airlines, nursing homes and hospitals. SD plans to import certain tableware designed especially for sale to rental companies and private caterers, who will in turn rent the tableware to individuals and others hosting parties at homes or other private locations. This merchandise will be marketed and sold at Rental Industry Trade Shows and will be priced based on individual 5-piece settings, not individual pieces. SD claims that the end users of rental chinaware are more concerned with appearance than durability, and consequently, the chinaware is thinner and lighter than institutional chinaware. SD will not provide the "non-chipping guarantee" that it traditionally offers for its institutional chinaware. A sample of the plate to be imported from Poland was substituted for the original prototype from Bangladesh (Ten Strawberry Street). A comparison sample of the standard commercial chinaware used in hotels, restaurants and other institutions also was presented. The dinner plate at issue measures 10 11/16 inches in diameter and weighs 531 grams (18.59 oz. or 1 lb. and 2.59 oz.). It is bright white in color with a high-gloss glaze. The "rim" portion of the plate measures 1 and 11/16 inches in width and is a little over 1/16ths of an inch in thickness. On the back of the plate, a label containing the following words appear: ZA ADY PORCELANY STO OWEJ "LUBIANA" S.A. POLAND #2038 The chinaware will be imported in either plain white or white with a single or double overglazed metal (i.e., gold, silver or platinum) band(s), to be located either on the outside rim of the plate or on both the outside and inside rims. No center designs, crests, or logos will be used. The subheadings under consideration are as follows: 6911 Tableware, kitchenware, other household articles and toilet articles, of porcelain or china: 6911.10 Tableware and kitchenware: 6911.10.10 Hotel or restaurant ware and other ware not household ware...doz.pcs. 31% ad valorem Other: Other: Other: 6911.10.52 Cups valued over $8 but not over $29 per dozen; ... plates not over 22.9 cm in maximum di- ameter and valued over $8.50 but not over $31 per dozen; plates over 22.9 but not over 27.9 cm in maximum diameter and valued over $ll.50 but not over $41 per dozen; ... doz PCs. 8% ad valorem ISSUE: Whether tableware used in the rental industry is classified as tableware for hotel or restaurant and other non-household ware, or as tableware for household ware. LAW AND ANALYSIS: 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. Chapter 69, HTSUS, provides for ceramic products. Heading 6911 covers all tableware, kitchenware, other household articles and toilet articles, of porcelain or china. Tableware and kitchenware is further subdivided into two distinct categories under subheading 6911.10: (1) articles for hotel or restaurant ware and other ware not household ware and (2) household ware. The household ware category is further subdivided by articles of bone chinaware and other than bone chinaware, and further subdivided by those available in specified sets and those that are not. SD contends that the rental chinaware falls within the class of goods principally used in the household and is therefore classifiable under the tariff provisions covering tableware "other" than hotel or restaurant ware. 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 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. In other words, the article's principal use at the time of importation determines whether it is classifiable within a particular class or kind. In Lenox Collections v. United States, 20 CIT , Slip Op. 96-30 (Feb. 2, 1996), the Court in its analysis referred to Additional U.S. Rule of Interpretation 1(a) and the need to focus on the principal use of the class or kind of goods to which an import belonged, not the principal use of a specific import, citing Group Italglass U.S.A., Inc. v. United States, 17 CIT 1177, 1178, 839 F. Supp. 866, 867 (1993). Headings 6911, 6912 and 6913, HTSUS, have been held to be "use" provisions both by the courts and Customs. See Lenox Collections v. United States, 19 CIT 345 (1995); HQ 084122; HQ 958999. Because both subheadings 6911.11.10 and 6911.11.52, HTSUS, are use provisions, Additional U.S. Rule of Interpretation 1(a), HTSUS, applies. "Principal use," for purposes of Additional U.S. Rule of Interpretation 1(a), means the use "which exceeds any other single use of the article." See U.S. International Trade Commission, Conversion of the Tariff Schedules of the United States Annotated Into the Nomenclature Structure of the Harmonized System: Submitting Report at 34-35 (USITC Pub. No. 1400)(June 1983). On a case-by-case basis, decisions under the Tariff Schedules of the United States (TSUS) - the HTSUS predecessor tariff - are deemed instructive in interpreting HTSUS provisions, provided the nomenclature remains unchanged and no dissimilar interpretation is required by the text of the HTSUS. See H. Rep. No. 100-576, 100th Cong., 2d Sess. 548, 550 (1988), a conference report to the Omnibus Trade & Competitiveness Act of 1988, Pub. L. No. 100-418. The nomenclature of the TSUS and the HTSUS are identical. Both provisions distinguish between "hotel or restaurant ware and other ware not household ware" and "household" ware. As the language of the two nomenclatures is identical, and the issue is essentially the same, we must consider HQ 082780, dated December 18, 1989, which was based on the TSUS. The only difference between the TSUS and the HTSUS in heading 6911 is the standard of use. "Principal use" replaced the prior standard of "chief use." While Additional U.S. Rule of Interpretation 1(a) 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; Lenox Collections v. United States, 20 CIT , Slip Op. 96-30 (Feb. 2, 1996). Generally speaking, commercial porcelain tableware (other than household) consists of two basic groups. The first is the traditionally thick and very heavy tableware used in institutional food services and the second is the thinner, not as heavy tableware used for finer or fancier dining. The "fine chinaware" is used by restaurants, hotels and caterers who want to offer their patrons fancier tableware. The American Hotel China is made in three grades based on wall thickness: Grade (1), Thick china,' 5/16 to 3/8 inch walls, is used for the more severely handled service, typically at lunch counters and military messes; Grade (2), Hotel (rolled edge) China,' 5/32 to 1/4 inch walls, is the normal type for hotel and restaurant service; and Grade (3), Medium-weight china,' less than 1/4 inch walls, is furnished for higher-class eating places where the service is handled with reasonable care, home usage, and also for numerous jars, trays, etc. in hospitals. See Felix Singer & Sonja S. Singer, Industrial Ceramics, Chemical Publishing Co., Inc., New York (1963) at p. 1096; see Rexford Newcomb, Jr., Ceramic Whitewares, Pitman Publishing Corp., New York (1947) at pp. 227-230; see Arthur E. Dodd & David Murfin, Dictionary of Ceramics, The Institute of Materials (3rd ed., 1994) at p. 11. As set forth in Industrial Ceramics (pps. 1089, 1096), commercial chinaware is made from the highest grade of raw materials (predominantly a mixture of kaolin, flint, feldspar and ball clay), selected to give the inside body as white a color as possible. It is very high in mechanical strength. The ware is not translucent in the normal hotel-china thickness, but it would be translucent if made as thin as other types of tableware. It is fired to complete vitrification (very low water absorption--under 0 - 3%), then covered with a fairly hard, resistant glaze. It has a high alumina content which gives its characteristic high strength. From the chapter on "Ceramics in the Home" in Industrial Ceramics (pps. 1089, 1096), there is also a class of dinnerware termed American Household China, which is a fine ware of very high strength (mechanical shock resistance) and translucency, but tending to cream instead of white. The body type is soft porcelain and it is used as high-grade domestic tableware. It uses the same raw materials (32% kaolin) as American Hotel China except for whiting and dolomite, and like the American Hotel China, has a low water absorption under 0 - 1%. Another class of dinnerware, Semi-Vitreous China, is the commonest type of lower priced tableware in the U.S. which is used for general household use and contains 19% kaolin, and which has little to no translucency, medium to high mechanical shock resistance, and a higher water absorption of 4 - 10%. Id. at pp. 1089, 1095. You have presented Federal Specification M-C-301L (June 21, 1976) used by the military which sets forth the requirements for chinaware specifically purchased for mess facilities. The GSA standard, Commercial Item Description No. A-A-2585A (GSA June 1, 1993), covers "white, restaurant-grade, china dinnerware" and establishes purchase requirements for performance, design, and construction requirements for restaurant-grade chinaware. It requires the article to pass several tests to be considered hotel grade. These include impact strength, chipping resistance and thermal shock as well as other requirements. Three samples each of a dinner plate, dessert dish, cup, and saucer were submitted to an independent laboratory for testing. The chinaware failed the impact strength requirement. On the basis of the lab report, you conclude that since the chinaware failed the impact strength criteria used by GSA, it must not be classified as hotel-grade but should be considered household ware. We note that information on the other GSA requirements listed on the GSA standard was not provided. The test results show that the chinaware in issue does not satisfy the impact and chipping resistance requirements (Paragraphs 4.5.1 and 4.5.2) of the GSA standard. However, it does not fall within the class of the traditional thick and heavy institutional ware to which M-C-301L is applicable. With regard to using a GSA standard to distinguish hotel/restaurant ware from household ware, the GSA standard applies to only chinaware of specific size and dimensions. The GSA standard dimension is for a dinner plate, 9 inches plus 1/4 inch or minus 1/16 inch, in outside diameter, which is considerably smaller than the 11 and 11/16 inches dinner plate at issue; the GSA rim width is 1/2 inch minimum to 3/4 inch maximum, which is much narrower than the 1 and 11/16 inch rim width of the prototype; the GSA height is 1 inch, plus 1/8 inch or minus 3/16 inch, while the prototype's height is less than 1 inch; the GSA bottom thickness is 1/8 inch minimum and the prototype is lower at 1/16 inch. The GSA standard is not useful because it requires specific dimensions for hotel grade ware, i.e., if the ware does not meet the dimensional requirements it will not be classified as hotel-grade. The GSA standards are also limited in usefulness because they are specifications for a narrow line of merchandise, to wit, china tableware for mess facilities. It is the use of the chinaware and not the physical composition that is critical for classification purposes. For example, in HQ 082780, Customs held that if a plate was emblazoned with a logo or crest of the hotel or restaurant, it was found to be hotelware regardless of the fact that without the logo, crest or symbol the chinaware would be classified as household chinaware. In HQ 082780, the Carborundum factors were applied to determine whether chinaware containing a variety of patterns was classifiable as hotel or restaurant ware (item 533.52, TSUS) or household ware (item 533.64, TSUS). That ruling involved imported fine household china intended for use by restaurants and hotels in their "finer dining areas." In addition, some of the household chinaware was modified (e.g., hotel/restaurant logos/names added to plate designs or patterns removed from the center of the plate) for sale to restaurants. Customs held that with the exception of the china containing hotel/restaurant logos or names, which are properly classified in the class of china used for hotels and restaurants, the patterned chinaware sold to and used by restaurants and hotels fell within the class of china "chiefly used" as household ware since the percentage of sales and amount of use of household china by restaurants and hotels did not exceed all other uses. On the facts presented, HQ 082780 is correct but is distinguishable from the chinaware at issue. A review of the literature and pictures of the chinaware in HQ 082780 reveals that of the 32 patterns, 12 were bone china (clearly within the household class) and the 20 other patterns of the "fine dining" chinaware were fully vitrified porcelain and would be considered either "hotel china" or "medium-weight" grade commercial china. The importer, Villeroy & Boch (hereinafter V&B), was both a hotel/restaurant and household supplier. V&B "fine dining" chinaware was stated to have more sophisticated decoration, color varieties and body shapes than typical institutional tableware and was oriented more towards specialty dining than coffee-shop or banquet type operations. The fine dining range of V&B's fully-vitrified porcelain chinaware was also suitable for hotel and restaurant use due to its use of body design and its "hotel" glaze (a durable, ivory-colored glaze which is exceptionally hard and both scratch and abrasion resistant). V&B stated in its "Hotel and Restaurant Division" brochure that the main difference between its "fine dining" tableware and its hotel ware was the fact that the cups do not contain the alumina additive. In its line of hotel pattern, banquet-weight tableware, the facts presented by V&B were that the plates and cups are reinforced with fully 38.5% alumina, which reduces chipping and breakage and improves the heat-retaining qualities and, that the plates have reinforced, rolled edges, glazed and polished feet to prevent abrasion and minimize wear when stacking. The weight comparison between the hotel patterns and the retail patterns given for two plate patters was 1 lb. and 11 oz. (hotel) and 1 lb. and 1.5 to 5 oz. (retail) and for cups was 7 to 8.5 oz. (hotel) and 5.5 oz. to 6 oz. (retail). The chinaware at issue in this case differs from and is distinguished from the tableware in HQ 082780 on principal use and on the Carborundum factors. This chinaware belongs to the "medium-weight" hotel china used for elegant dining. Due to technological advances, commercial ceramic dinnerware need not be bulky and lacking in style. Arguably, the differences may be in appearance but not in use. Thus, we are of the opinion that if the thickness of the chinaware is more than 1/4 inch, it is hotel-grade provided that the other characteristics are satisfied. If the thickness is less than 1/4 inch, it may be hotel ware or household ware depending on its use. As a general rule, an article's physical form will indicate its principal use and thus to what class or kind it belongs. Should, however, an exception arise so that 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 to determine to which class or kind the article belongs, as household chinaware or institutional chinaware. I. General Physical Characteristics You contend that the subject chinaware falls within the class of goods that is principally used in the household as that in HQ 082780, contending that the following physical characteristics support the position that the rental chinaware is household chinaware and not institutional. However, we note that "medium-weight" hotel china has also found an increasing market for home use; for this purpose it is usually given more elaborate decoration than is normal in restaurant use. See Ceramics Whitewares at 228. First, the chinaware in issue is lighter in weig