Revocation of Headquarters Ruling Letter (HQ) 960938;Insulated Casserole Dish Caddie Bag; SGI, Incorporated v.United States, 122 F.3d 1468 (Fed. Cir. 1997); Outer Layerof Fabric-backed, Compact Plastics

HQ 962296 March 17, 1999 CLA-2 RR:CR:TE 962296 GGD CATEGORY: Classification TARIFF NO.: 6307.90.9989 Ms. Cindy Shahamat Schenker International, Inc. 4700 Lima Street Denver, Colorado 80239-0945 RE: Revocation of Headquarters Ruling Letter (HQ) 960938; Insulated Casserole Dish Caddie Bag; SGI, Incorporated v. United States, 122 F.3d 1468 (Fed. Cir. 1997); Outer Layer of Fabric-backed, Compact Plastics Dear Ms. Shahamat: In Headquarters Ruling Letter (HQ) 960938, issued to you November 14, 1997, on behalf of Tops of Rockies Marketing, Customs classified an insulated casserole dish caddie bag in subheading 3924.10.50, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), the provision for “Tableware, kitchenware, other household articles...of plastics: Tableware and kitchenware: Other.” We have reviewed that ruling and have found it to be in error. Therefore, this ruling revokes HQ 960938. 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 (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed revocation of HQ 960938 was published on February 3, 1999, in the Customs Bulletin, Volume 33, Number 5. FACTS: By letters dated September 17 and November 3, 1997, you requested reconsideration of HQ 960184, issued to you September 4, 1997, in which this office had classified the insulated casserole dish caddie bag in subheading 4202.92.9060, HTSUSA. In your request, you described the composition of the merchandise at issue as “100% pvc” (polyvinyl chloride - a noncellular, compact plastic). In HQ 960938, based in part upon the belief that the outer layer of the caddie bag was composed solely of PVC, this office stated that a change in the classification of the caddie bag had been effected by the decision of the Court of Appeals for the Federal Circuit (CAFC) in SGI, Incorporated v. United States, 122 F.3d 1468 (Fed. Cir. 1997), hereinafter SGI, in which the CAFC held that certain soft-sided, insulated cooler bags with outer surface of plastics were properly classified in subheading 3924.10.50, HTSUSA. We have recently become aware, however, that the PVC outer surface of the casserole dish caddie bag actually comprises the outward facing surface of a layer composed of a textile woven fabric that is coated, covered or laminated with PVC plastic. The casserole dish caddie bag measures approximately three inches in height by 16 inches in width by ten inches in depth. It features webbed textile carrying handles, a zippered closure extending along the top front and sides, and an interior pouch pocket (for insertion of a removable cold pack) with hook and loop fabric fasteners. The bag is a portable, soft-sided, insulated container that is primarily designed to store and preserve foodstuffs. ISSUE: Whether the insulated casserole dish caddie bag is classified under heading 3924, HTSUSA, as a container with outer surface of plastics, or under heading 6307, HTSUSA, as an other made up (textile) article with outer surface of fabric-backed compact plastics. 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 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. As in HQ 960938 and above, the classification of certain portable, soft-sided, insulated cooler bags with outer surface of plastics, was examined by the CAFC in SGI. 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 Court 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 September 10, 1998 (and approved for dissemination to members of the importing community), by which the principles of the CAFC’s decision were expressly extended to portable, hard or soft-sided, insulated coolers and similar insulated containers (whose primary purpose is to store and preserve food and/or beverages), with outer surface of plastics and with outer surface of textile materials (classified in subheading 6307.90.9905, 6307.90.9907, or 6307.90.9909, HTSUSA, depending upon whether the outer surface is composed of cotton, man-made fibers, or other textile materials, respectively). The instruction issued on September 10, 1998, expressly extended the principles of the CAFC’s decision to foodstuff-related, insulated containers whose exterior layer is composed of a textile fabric that is coated, covered or laminated with compact plastics, with the plastic surface of the layer facing outward. Such containers are classified in subheading 6307.90.9989, HTSUSA, a provision which is currently not subject to quota/visa requirements. In light of the principles of the SGI decision, the instructions noted above, and the fact that the casserole dish caddie bag has an outer layer that is composed of fabric-backed compact plastics, the article is classified in subheading 6307.90.9989, HTSUSA. HOLDING: The soft-sided, insulated, casserole dish caddie bag is classified in subheading 6307.90.9989, HTSUSA, the provision for “Other made up [textile] articles, including dress patterns: Other: Other: Other, Other: Other.” The general column one duty rate is 7 percent ad valorem. HQ 960938, issued November 14, 1997, 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, John Durant, Director Commercial Rulings Division