Tariff classification of keychains and a carabiner with lights

HQ H025877 June 11, 2009 CLA-2 OT:RR:CTF:TCM H025877 JRB CATEGORY: Classification TARIFF NO.: 8513.10.20 Mr. Kyu Hur Zen Design Group, Ltd. 2850 Coolidge Highway Berkley, Michigan 48072 RE: Tariff classification of keychains and a carabiner with lights Dear Mr. Hur: This is in response to your letters dated March 19, 2008, and December 19, 2008, in which you requested that U.S. Customs and Border Protection (CBP) reconsider Headquarters Ruling Letter (HQ) H020454 issued to you on behalf of Zen Design Group on February 14, 2008. At issue in that ruling was the classification of novelty products known as “Zoolights” under the Harmonized Tariff Schedule of the United States (HTSUS). CBP classified them under heading 8513, HTSUS, as flashlights. You believe reconsideration is warranted because “certain facts were not properly presented in the original request, and certain other facts have subsequently changed.” Due to these changed facts, we have decided to treat your request as a request for a prospective ruling on new and different products. FACTS: Your letter dated March 19, 2008, requested that we consider the classification of three different product lines. The first line, the “Zoolight Keychain”, is made up of approximately twenty-five different plastic figures representing various animals. These products feature a u-shaped ratchet lever located on the back of the plastic figure’s body, through which a metal keychain is permanently affixed. The keychain measures approximately two inches in length and has a metal c-shaped hook at the end, closed by a spring-loaded clasp. When the ratchet lever on the figure’s back is depressed, the creature’s mouth opens, and a red light emitting diode (LED) illuminates. The second product line is the Zoolight keychain with sound, which is available in ten different animal figures. They are the same as the Zoolight Keychains described above, except that when the ratchet lever on the back of the plastic figure’s body is depressed, the figure emits various sounds when the mouth opens and the LED illuminates. In your request you included a sample product, a “Rat Zoolight Keychain with Sound”, which emits sounds that are similar to a rat’s along with other sounds, including actual speech. The third product line that you asked us to classify is the “Zoolight Carabiner”. This product is available in six different animal shapes. You stated in your letter to us that the tail “folds over onto the animal’s body, forming the hook of a carabiner” (i.e., a coupling device). A spring loaded hinge keeps the hook closed. In addition, there is a lever on the back of the figure that when depressed, causes the figure’s mouth to open and an LED to illuminate. You described all three of these products as follows: The main feature of each of these products is its animal figure. Despite their small size, each figure is meticulously detailed. The sound feature, where included, is similarly, true to the sound the animal actually makes, or as in the case of the dinosaur, which our best research indicates it might have made. These items are sold as toys in animal-themed stores, such as gift shops at zoos. ISSUE: What is the classification of the Zoolight keychains and carabiner under the HTSUS? LAW AND ANALYSIS: Merchandise is classifiable under the HTSUS in accordance with the General Rules of Interpretation (GRIs). The systematic detail of the HTSUS is such that most goods are classified by application of GRI 1, that is, 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 6 provides: For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires. The HTSUS provisions under consideration are as follows: 8513 Portable electric lamps designed to function by their own source of energy (for example, dry batteries, storage batteries, magnetos), other than lighting equipment of heading 8512; parts thereof: 8513.10 Lamps: 8513.10.20 Flashlights 8513.10.40 Other 9503.00.00 Tricycles, scooters, pedal cars and similar wheeled toys; dolls’ carriages; dolls, other toys; reduced scale (“scale”) models and similar recreational models, working or not; puzzles of all kinds; parts and accessories thereof, Note 1(p) to Section XVI (which includes headings 8513 and 8543), HTSUS, excludes articles of Chapter 95 from classification in that section. The Harmonized Commodity Description and Coding System Explanatory Notes (EN’s) constitute the official interpretation of the HTSUS. While not legally binding or dispositive, the ENs provide commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings at the international level. CBP believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127 (Aug. 23, 1989). In your initial request on March 19, 2008, and in your follow-up letter on December 19, 2008, you asserted that the Zoolights should be classified in heading 9503, HTSUS, as a toy because they are being sold with toys in gift shops. In particular you state “[b]ecause of the detailed depiction of each animal figure, these items are intended to be enjoyed in daylight, when the user can see the animal figure.” You contend that the light merely adds to the customer’s interest in the item and that consumers would still be interested in the items without the light because of the meticulous detail that is put into every Zoolight. You also contend that consumers in the market for a flashlight would not purchase this item because they are a poor comparison to reasonably priced flashlights. In support of classification in heading 9503, HTSUS, you brought to our attention New York Ruling Letter (NY) N020200, dated November 10, 2007, in which CBP classified a plastic toy transformer that could be transformed into a working flashlight in heading 9503 as a toy. The U.S. Court of International Trade (CIT) construes heading 9503, HTSUS, as a "principal use" provision, insofar as it pertains to toys. See Minnetonka Brands v. United States, 110 F. Supp. 2d 1020, 1026 (Ct. Int’l Trade 2000). Classification in a principal use provision “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”. See Additional U.S. Rule of Interpretation 1(a), HTSUS. To be a toy, the "character of amusement involved [is] that derived from an item which is essentially a plaything." Wilson's Customs Clearance, Inc. v. United States, 59 Cust. Ct. 36, C.D. 3061 (1967). Similarly, the EN for heading 9503, HTSUS, provides that toys are articles “intended essentially for the amusement of persons (children or adults)”. EN 95.03(D). Accordingly, a toy of heading 9503, HTSUS, is a plaything that is principally used for amusement. All the articles at issue incorporate a functional light. In addition, the keychains have sound effects, which are incidental to their light functions. Heading 8513, HTSUS, provides for portable electric lamps designed to function by their own source of energy. The EN to heading 8513 provides: This heading covers portable electric lamps designed to function by means of a self contained source of electricity (e.g., dry cell, accumulator or magneto). They comprise two elements (i.e., the lamp proper and the source of electricity) which are usually mounted and directly connected together, often in a single case. In some types, however, these elements are separate and are connected by wires. The term "portable lamps" refers only to those lamps (i.e., both the lamp and its electricity supply) which are designed for use when carried in the hand or on the person, or are designed to be attached to a portable article or object. They usually have a handle or a fastening device and may be recognized by their particular shapes and their light weight. The term therefore excludes lighting equipment for motor vehicles or cycles (heading 85.12), and lamps which are connected to a fixed installation (heading 94.05). The lamps of this heading include: …. (7) Fancy torches in the shape of pistols, lipsticks, etc. Composite articles composed of a lamp or torch and a pen, screwdriver, key ring, etc., remain classified here only if the principal function of the whole is the provision of light. For articles that are both amusing (e.g. articles of heading 9503) and functional (e.g. articles of heading 8513), we look to Ideal Toy Corp. v. United States, 78 Cust. Ct. 28, 33 (1977), in which the court stated that "when amusement and utility become locked in controversy, the question becomes one of determining whether amusement is incidental to the utilitarian purpose, or whether the utility purpose is incidental to the amusement." We tested the sample that you submitted to us, the rat keychain with sound, and found that the light is strong enough to illuminate a lock in a dark room or to read labels on packages in that room. While the product does not emit the amount of light that a typical flashlight emits, it emits enough light to function as a source of illumination. The carabiner or keychain component allows the users of these articles to conveniently attach them to their keychains, backpacks, or person. In addition, the name under which these articles are marketed and sold is “Zoolights”. We believe that this name causes purchasers to expect that these items will function as lights. In our view, the fact that Zoolights may be sold in animal-themed gift shops would not detract from this expectation. Based on the foregoing, we find that the Zoolights cannot be classified as a toy in heading 9503, HTSUS, because their amusement function is incidental to their utilitarian function as a portable lamp and is not their principal function. This finding is consistent with our prior classification decisions on articles that are novelties but that are also functional. See HQ 959473, April 8, 1997; NY D81433, September 18, 1998; HQ 962692, August 31, 2000; and HQ 959043, April 11, 1997. Moreover, we find that both the keychains and the carabiners fall within the scope of heading 8513, HTSUS, as explained by EN 85.13. They are fancy torches that are designed to be attached to a portable article or object. See EN 85.13. With regard to NY N020200, dated December 10, 2007, the relevant good in that ruling was described as “a plastic toy that can be transformed into a robot, a skorox and a flashlight.” The subject article had a playful characteristic to it, in that it was able to transform into many different objects that a person could play with. The manipulative qualities of the article made it a plaything, even though one of the objects into which it could transform was a real flashlight. The Zoolight does not have similar characteristics. As such, we do not believe that NY N020200 is persuasive in classifying Zoolights. After classifying the Zoolights in heading 8513, HTSUS, GRI 6 is implicated because we must determine whether the good falls under subheading 8513.10.20, HTSUS, as flashlights or subheading 8513.10.40, as an “other” lamp. The judicially determined definition of a flashlight is “a small battery-operated, portable electric light.” See Sanyo Electric Inc. v. United States, 496 F. Supp. 1311, 1315 (Cust. Ct. 1980). Applying this definition to the present case, we find that the Zoolight is a small battery-operated electric light because it has an LED, is powered by a battery and it is portable. Therefore, the Zoolights are classified under heading 8513.10.20, HTSUS, as flashlights. HOLDING: By application of GRI 1, the Zoolight Carabiner and Zoolight Keychains are classified under heading 8513, HTSUS. They are specifically provided for in subheading 8513.10.20, HTSUS, which provides for “Portable electric lamps designed to function by their own source of energy …: Lamps: Flashlights”, by application of GRI 6. The 2009 column one general rate of duty is 12.5% ad valorem. Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the Internet at www.usitc.gov/tata/hts/. A copy of this ruling letter should be attached to the entry documents filed at the time the goods are entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the CBP officer handling the transaction. Sincerely, Gail A. Hamill Chief, Tariff Classification and Marking Branch