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HQ 083201


October 30, 1989

CLA-2 CO:R:C:G 083201 JMH

CATEGORY: CLASSIFICATION

TARIFF NO.: 8482.10.50; 9801.00.10

Ms. Jeannine Daigle
F.W. Myers & Co., Inc.
P.O. Box 369
Madawaska, Maine 04756

RE: Love Seat Kit and Stationary Rocker Kit

Dear Ms. Daigle:

Your letter of October 14, 1988, regarding a classification ruling for your love seat kit and your stationary rocker kit has been referred to this office for a reply.

FACTS:

The merchandise in question are two kits imported from Canada. The first is a love seat kit which includes blue prints for wooden chairs and the bearings, bolts, and nuts. All of the pieces are made in Canada. The second item, the stationary rocker kit, includes Canadian made blue prints, cover plates, bolts, nuts and washers, and U.S.A. made bearings.

ISSUES:

Under which heading of the Harmonized Tariff Schedule of the United States (HTSUSA) should the Love Seat Kit and the Stationary Rocker Kit be classified? Will the American ball- bearings in the stationary rocker kit affect the classification?

LAW AND ANALYSIS:

The classification of merchandise under the HTSUSA is governed by the General Rules of Interpretation (GRI's). 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...according to the following provisions."

The "following provisions" includes GRI 3 which addresses mixed and composite goods and sets. GRI 3(b) states that "goods put up in sets for retail sale...shall be classified as if they consisted of the material or component which gives them their essential character..."

"Goods put up in sets for retail sale" are those goods which (1) consist of at least two different articles which are classifiable in different headings, (2) consist of articles put together to meet a particular need or specific activity, and (3) the combined articles are sold directly to users without repacking. Harmonized Commodity Description and Coding System, Explanatory Notes, Vol.1, p. 4.

The present kits are "goods put up in sets for retail sale" within the meaning of GRI 3(b). Therefore, the kits' classifications are determined by the component which gives them their essential character.

It is the opinion of this office that the essential character of the stationary rocker kit is imparted by the ball bearings. The ball bearings facilitate the rocking mechanism without which the chair would not rock. Although the information submitted lacked descriptive literature for the love seat kit, this office assumes that it functions similarly to the stationary rocker. Therefore the ball bearings also lend the love seat kit its essential character.

Ball bearings are classified within heading 8482, HTSUSA, which describes "Ball or roller bearings, and parts thereof..." Thus, the stationary rocker kit and the love seat kit are classified within this heading since the ball bearings impart the kits' essential characters.

An additional issue is raised by the ball bearings within the stationary rocker kit which are of U.S. origin. Products of the U.S. that are exported and returned without having been advanced in value or improved in condition by any means while abroad are eligible for duty-free entry under subheading 9801.00.10, HTSUSA. In determining the eligibility of an article for this tariff treatment, the question is whether the article meets "the conditions and requirements" of the tariff provision (i.e., is the article a product of the U.S. which is returned without having been advanced in value or improved in condition while abroad). Chapter 98, U.S. Note 1, HTSUSA. Subheading 9801.00.10, HTSUSA, does not allow for the constructive segregation of the items or components which make up the article and, thus, requires an "all or nothing" application.

Since the stationary rocker kit to be imported in this case consists of foreign components, it is not a product of the U.S. The stationary rocker kit, therefore, fails to meet the
conditions and requirements of subheading 9801.00.10, HTSUSA, and is ineligible for duty-free entry under this tariff provision.

HOLDING:

The stationary rocker kit and the love seat kit are classified within subheading 8482.10.50, HTSUSA, as "Ball or roller bearings, and parts thereof...Ball bearings...Other," because the ball bearings within each kit give the kits their essential character. The rate of duty is 9.9 percent ad valorem, as provided in the special rate column for goods subject to the Canada-United States Free Trade Agreement.

The American made ball bearings are ineligible for duty-free treatment under subheading 9801.00.10, HTSUSA, as they are combined with foreign components. Therefore, the stationary rocker kit is not a "product of the United States."

Sincerely,

John Durant, Director
Commercial Rulings Division

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