Portable, Soft-Sided, Insulated Cooler Bags; SGI, Incorporated v. United States, 122 F.3d 1468 (Fed. Cir. 1997); Cooler bag with exterior layer composed of a textile fabric combined with plastic with the textile surface facing outward

HQ 961963 April 7, 1999 CLA-2 RR:CR:TE 961963 SS CATEGORY: Classification TARIFF NO.: 6307.90.9907 Janine Johnson Marlowe & Co., Inc. P.O. Box 90459 Los Angeles, CA 90009 Re: Portable, Soft-Sided, Insulated Cooler Bags; SGI, Incorporated v. United States, 122 F.3d 1468 (Fed. Cir. 1997); Cooler bag with exterior layer composed of a textile fabric combined with plastic with the textile surface facing outward Dear Ms. Johnson: This letter is in response to your request of March 3, 1998, on behalf of your client Kin Image, Inc., concerning the classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) of a portable, soft-sided, insulated cooler bag imported from China. A sample was submitted with your request. FACTS: The submitted sample is a cooler bag, designated as style 70D-VL, which is constructed of two distinct layers of material. The exterior or outer layer consists of a 100% nylon woven fabric which has been coated, covered or laminated with a layer of compact plastic which is said to be polyvinyl chloride. The textile surface of this material faces outward. The plastic surface, which is hidden on the interior, has been embossed to simulate a leather look. The inner layer of the product is a thin layer of plastic foam (1/8 inch thick) laminated to a metalized plastic sheet. This layer functions as an insulating and cushioning material as well as a waterproof layer which prevents spills from leaking. The cooler bag is rectangular in shape and measures approximately 6 inches high by 8.35 inches wide by 5.25 inches deep. The cooler bag features two woven nylon carrying straps and a zipper closure which runs 3/4 of the way around the top of the bag. The submitted cooler bag is said to be designed chiefly for preserving and carrying six (6) cans of a beverage. ISSUE: What is the proper classification for the portable, soft-sided, insulated cooler bag whose exterior layer is composed of a textile fabric combined with plastic with the textile surface facing outward? LAW AND ANALYSIS: Classification of goods under the HTSUS is governed by the General Rules of Interpretation (“GRIs”). GRI 1 provides that classification 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 Explanatory Notes (EN) to the Harmonized Commodity Description and Coding System, which represent the official interpretation of the tariff at the international level, facilitate classification under the HTSUS by offering guidance in understanding the scope of the headings and GRI. The classification of certain portable, soft-sided, insulated cooler bags with outer surface of plastics, was recently examined by the Court of Appeals for the Federal Circuit (CAFC) in SGI, Incorporated v. United States, 122 F.3d 1468 (Fed. Cir. 1997). The CAFC focused on whether food or beverages were involved with the eo nomine exemplars set forth in the tariff provisions at issue and, without discussion of heading 4202 exemplars that organize, store, protect, and/or carry food or beverages, the CAFC held that the appropriate classification for the cooler bags was subheading 3924.10.50, HTSUS, the provision for “Tableware, kitchenware, other household articles . . . of plastics: Tableware and kitchenware: Other.” The Court stated that this classification “does encompass exemplars that are ejusdem generis with the coolers because their purpose is to contain food and beverages.” The exemplars (specifically enumerated in subheading 3924.10.10) which the Court noted in particular were the “various household containers for foodstuffs such as salt, pepper, mustard, and ketchup dispensers and serving pieces for food.” This office concluded that the CAFC’s decision in SGI should be implemented. Instructions were issued to Customs field personnel on March 18, 1998 (and approved for dissemination to members of the importing community), which expressly extended the principles of the CAFC’s decision to portable, soft-sided, insulated coolers and similar insulated containers (whose primary purpose is to store and preserve food and/or beverages), with outer surfaces composed in whole or in part of textile materials. Such articles are classified in subheading 6307.90.9905, 6307.90.9907, or 6307.90.9909, HTSUSA, depending on whether the outer surface is composed of cotton, man-made fibers or other textile materials, respectively. The statistical annotations (the ninth and tenth digits) were created as subheadings of 6307.90.99, HTSUS, to provide for cooler bags with an outer surface of textile materials. They were also created to capture and continue the quota treatment of cooler bags which have migrated from heading 4202, HTSUS, as the result of litigation in SGI, Incorporated v. United States, 122 F.3d 1468 (Fed. Cir. 1997). In light of the principles of the SGI decision and the instructions noted above, the subject cooler bags with outer surface of textile materials are classified in subheading 6307.90.9907, HTSUSA. We note that Customs has previously classified similar cooler bags under subheading 6307.90.9907, HTSUSA. See Headquarters Ruling Letter (“HRL”) 961035, dated June 12, 1998; HRL 961207, dated June 18, 1998; HRL 961342, dated July 9, 1998; and HRL 961712, dated November 11, 1998. HOLDING: The portable soft-sided, insulated cooler bag identified as style 70D-VL is classified in subheading 6307.90.9907, HTSUSA, textile category 670, the provision for “Other made up articles, including dress patterns: Other: Other: Other, Cooler bags with an outer surface of textile materials: of man-made fibers.” The general column one duty rate is seven percent (7%) ad valorem. 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 renegotiations and changes, to obtain the most current information available, we suggest that you check, close to the time of shipment, the Status Report on Current Import Quotas (Restrain Levels), an internal issuance of the U.S. Customs Service, which is available for inspection at your 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 applicable to textile merchandise, you should contact your local Customs office prior to importation of this merchandise to determine the current status of any import restraints or requirements. Sincerely, John Durant, Director Commercial Rulings Division