Revocation of NY N302855; Classification of textile covered high-density fiberboard boxes

HQ H305320 June 8, 2020 OT:RR:CTF:FTM H305320 MJD CATEGORY: Classification TARIFF NO.: 4420.90.65 Mr. Alan R. Klestadt Ms. Maria T. Vanikiotis Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP 599 Lexington Ave, 36th floor New York, NY 10022 - 7648 RE: Revocation of NY N302855; Classification of textile covered high-density fiberboard boxes Dear Mr. Klestadt and Ms. Vanikiotis: This is in response to your letter of September 3, 2019, on behalf of The Container Store (“TCS”), requesting reconsideration of New York Ruling Letter (“NY”) N302855 issued to TCS by U.S. Customs and Border Protection (“CBP”) on March 5, 2019. The ruling pertained to the tariff classification under the Harmonized Tariff Schedule of the United States (“HTSUS”) of two textile covered storage boxes, a drawer organizer and a drop front storage bin. In NY N302855, CBP classified both storage boxes under subheading 6307.90.9889, of the Harmonized Tariff Schedule of the United States Annotated (“HTSUSA”), which provides for “Other made up articles, including dress patterns: Other: Other: Other: Other: Other.” We have reviewed NY N302855 and found it to be incorrect. Accordingly, CBP is revoking NY N302855 for the reasons set forth below. Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. §1625(c)(1)), as amended by section 623 of Title VI, notice of the proposed action was published in the Customs Bulletin, Vol. 54, No. 16, on April 29, 2020, proposing to revoke NY N302855 and to revoke any treatment accorded to substantially identical transactions. No comments were received in response to this notice. FACTS: NY N302855 pertains to two styles of storage boxes. Each storage box is made with high-density fiberboard (“HDF”) and covered in textile. The first box is an opened faced drawer organizer that contains multiple divider panels inside of it. The second box is a closed box sweater organizer with a drop front panel that is see through so consumers can view the contents inside of the box. The drop front panel can be opened to provide access to the stored items. Both storage boxes come in a variety of sizes and can be used to store clothes, accessories, hosiery, and lingerie. In NY N302855 the subject boxes were classified in heading 6307, HTSUS. They were specifically classified in subheading 6307.90.9889, HTSUSA, which provides for “Other made up articles, including dress patterns: Other: Other: Other: Other: Other.” ISSUE: Whether the subject boxes are classified under heading 4420, HTSUS, which provides for “Wood marquetry and inlaid wood; caskets and cases for jewelry or cutlery and similar articles, of wood; statuettes and other ornaments, of wood; wooden articles of furniture not falling within chapter 94” or heading 6307, HTSUS, which provides for “Other made up articles, including dress patterns.” LAW AND ANALYSIS: Classification of goods under the HTSUS is governed by 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 GRIs 2 through 6 may then be applied in order. GRI 3 states, in pertinent part: When, by application of rule 2(b) or for any other reason, 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), 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 2020 HTSUS headings under consideration are as follows: 4420: Wood marquetry and inlaid wood; caskets and cases for jewelry or cutlery and similar articles, of wood; statuettes and other ornaments, of wood; wooden articles of furniture not falling within chapter 94: * * * * 6307: Other made up articles, including dress patterns: * * * * Note 7 to Section XI, which includes Chapters 50-63, provides that: For the purposes of this section, the expression “made up” means: Cut otherwise than into squares or rectangles; Produced in the finished state, ready for use (or merely needing separation by cutting dividing threads) without sewing or other working (for example, certain dusters, towels, tablecloths, scarf squares, blankets); Cut to size and with at least one heat-sealed edge with a visibly tapered or compressed border and the other edges treated as described in any other subparagraph of this note, but excluding fabrics the cut edges of which have been prevented from unraveling by hot cutting or by other simple means; Hemmed or with rolled edges, or with a knotted fringe at any of the edges, but excluding fabrics the cut edges of which have been prevented from unraveling by whipping or by other simple means; Cut to size and having undergone a process of drawn thread work; Assembled by sewing, gumming or otherwise (other than piece goods consisting of two or more lengths of identical material joined end to end and piece goods composed of two or more textiles assembled in layers, whether or not padded); or Knitted or crocheted to shape, whether presented as separate items or in the form of a number of items in the length. * * * * In addition, in interpreting the HTSUS, the Explanatory Notes (“ENs”) of the Harmonized Commodity Description and Coding System may be utilized. The ENs to the Harmonized Commodity Description and Coding System represent the official interpretation of the tariff at the international level. While neither legally binding nor dispositive, the ENs 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). The EN to heading 44.20 provides, in pertinent part, the following: The articles of this heading may be made of ordinary wood or of particle board or similar board, fibreboard, laminated wood or densified wood (see Note 3 to this Chapter).   It also covers a wide variety of articles of wood (including those of wood marquetry or inlaid wood), generally of careful manufacture and good finish, such as: small articles of cabinetwork (for example, caskets and jewel cases); small furnishing goods; decorative articles. Such articles are classified in this heading, even if fitted with mirrors, provided they remain essentially articles of the kind described in the heading. Similarly, the heading includes articles wholly or partly lined with natural or composition leather, paperboard, plastics, textile fabrics, etc., provided they are articles essentially of wood.   The EN to heading 63.07 provides, in pertinent part, the following: This heading covers made up articles of any textile material which are not included more specifically in other headings of Section XI or elsewhere in the Nomenclature. * * * * In this case, no single heading describes the boxes at issue in their entirety. Each box is a composite good made of two materials, the fiberboard and the textile fabric. The fiberboard is prima facie classified in heading 4420, HTSUS, and the textile covering is prima facie classified in heading, 6307, HTSUS. As such, the tariff classification of these boxes must be determined by applying GRI 3(b). According to GRI 3(b), composite goods must be classified according to the material or component that imparts the good’s essential character. In order to identify a composite good’s essential character, the U.S. Court of International Trade (“CIT”) has stated that the “essential character” of an article is “that which is indispensable to the structure, core or condition of the article, i.e., what it is.” Structural Industries v. United States, 360 F. Supp. 2d 1330, 1336 (Ct. Int’l Trade 2005). EN VIII of GRI 3(b) also provides guidance on the meaning of “essential character.” EN VIII to GRI 3(b) explains that “[t]he factor which determines essential character will vary as between different kinds of goods. It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of the constituent material in relation to the use of the goods.” Several court decisions on the essential character for GRI 3(b) purposes have looked primarily to the role of the constituent material in relation to the use of the goods. See Estee Lauder, Inc. v. United States, 815 F. Supp. 2d 1287, 1296 (Ct. Int'l Trade 2012); Structural Industries, 360 F. Supp. 2d 1330; Conair Corp. v. United States, 29 C.I.T. 888 (2005); Home Depot USA, Inc. v. United States, 427 F. Supp. 2d 1278 (Ct. Int'l Trade 2006), aff'd 491 F.3d 1334 (Fed. Cir. 2007). In NY N302855, CBP found that the fabric covered drawer organizer and drop font sweater organizer made with HDF and covered in fabric were products of 6307, HTSUS. However, the boxes are products of 4420, HTSUS because the essential character of the boxes is the HDF, it is what makes the boxes function as a box. The HDF is greater in weight and bulk than the textile fabric, it gives the boxes its structure, support and rigidity, without which the boxes would not be able to stand on its own, hold any contents inside of it, or be recognized as a box. Essentially, the box would not be a box without the HDF. Although, the textile is important to the box – it may enhance the marketability of the box - the textile fabric is not an integral part of what makes the box function as a box. The textile covering is an aesthetic feature that does not change the essential character of the box or its use as a box. In addition, we note that prior CBP rulings have classified similar items made of wood material and covered in textile fabric as merchandise classified in heading, 4420, HTSUS. See, for example, NY 851879, dated May 14, 1990 (classifying, in part, a wood trinket box covered on the outside with textile. CBP stated that “[e]essentially, this product is a decorated wood box. The simple textile covering on it is not any more unusual than a paper covering, a plastic covering or any other decorative finishing applied to the box.”); NY N012065, dated July 2, 2007 (classifying a “Brown Suede Candy Box” constructed of Medium density wood fiberboard and covered with imitation suede fabric. CBP explained that “[t]he role the wood plays in the functioning of the product as a box is more important than the role the fabric plays in providing its decorative appeal.”); NY N013058, dated July 19, 2007 (classifying a shoe storage box constructed of wood fiberboard and covered on the top and sides in a woven tweed fabric); NY N021907, dated January 28, 2008 (classifying a fabric covered medium density wood fiberboard box. CBP stated that the “[t]he essential character of the box is imparted by the wood because of the role the wood plays in the functioning of the article.”); NY N224320, dated July 31, 2012 (classifying four various storage boxes constructed of medium density fiberboard, covered on the outside with a woven linen textile, and lined with woven cotton textile); and, NY N238344, dated March 12, 2013, (classifying two trunks made with medium density fiberboard and covered in woven textile). Accordingly, we conclude that the boxes in NY N302855 are properly classified in heading 4420, HTSUS. HOLDING: By application of GR1 3(b) and GRI 6, the articles at issue in NY N302855 are classified in heading 4420, HTSUS, specifically under subheading 4420.90.6500, HTSUS, which provides for “wood marquetry and inlaid wood; caskets and cases for jewelry or cutlery and similar articles, of wood; statuettes and other ornaments, of wood; wooden articles of furniture not falling within chapter 94: Other: Jewelry boxes, silverware chests, cigar and cigarette boxes, microscope cases, tool or utensil cases and similar boxes, cases and chests, all the foregoing of wood: Other: Lined with textile fabrics.” The 2020 column one duty rate is free. Duty rates are provided for your convenience and subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided for at www.usitc.gov. EFFECT ON OTHER RULINGS: NY N302855, dated March 5, 2019, is hereby REVOKED. In accordance with 19 U.S.C. § 1625(c), this ruling will become effective 60 days after its publication in the Customs Bulletin. Sincerely, Craig T. Clark, Director Commercial and Trade Facilitation Division