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HQ 952894

September 9, 1993

CLA-2 CO:R:C:F 952894 GGD


TARIFF NO.: 9503.70.80; 9902.71.13

District Director of Customs
619 South Canal Street, Suite 217
Chicago, Illinois 60607

RE: Decision on Application for Further Review of Protest No. 3901-92-101204, filed September 3, 1992, concerning the classification of a plastic combat set and a plastic cowboy and Indian set

Dear Sir:

This is a decision on a protest filed September 3, 1992, against your decision in the classification and liquidation of plastic combat sets and plastic cowboy and Indian sets from China.


You classified the merchandise under subheading 9503.70.80, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), the provision for other toys, put up in sets. The protestant claims, through counsel, that the merchandise should be classified under subheading 9503.90.60, HTSUSA, the provision for other toys, not having a spring mechanism; and that the goods should be duty-free under subheading 9902.71.13, HTSUSA, the provision for articles of heading 9503, valued not over 5 cents per unit.

The sample articles submitted, identified as item nos. 04427 (20 soldiers, 2 tanks, 1 jeep, and one helicopter, all plastic and small in size) and 04428 (10 Indians, 6 horses, and 6 cowboys, all plastic and small in size), are imported in clear plastic packages measuring approximately 6 inches by 11 inches, -2-
with paperboard headers that are perforated for hanging display. The soldiers, cowboys, and Indians have various positions and weapons.


Whether the articles should be classified in subheading 9503.70.80, HTSUSA, the provision for other toys put up in sets, or in subheading 9503.90.60, HTSUSA, the provision for other toys not having a spring mechanism.

Whether, for purposes of duty-free treatment under subheading 9902.71.13, HTSUSA, the term "unit" means each separate article or individual toy comprising a toy set, or means the entire retail package of a toy set.


Classification under the HTSUSA is made in accordance with the General Rules of Interpretation (GRI's). The systematic detail of the harmonized system is such that virtually all 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 GRI's may then be applied. The Explanatory Notes (ENs) to the Harmonized Commodity Description and Coding System, which represent the official interpretation of the tariff at the international level, facilitate classification under the HTSUSA by offering guidance in understanding the scope of the headings and GRI's.

The proper heading in this case is clear, i.e., heading 9503 for toys. The subheadings at issue essentially differentiate between toys that are put up in sets, and toys which do not make up sets.

Through counsel, the protestant notes that "sets" are specifically mentioned in GRI 3, are comprised of goods put up to meet a particular need or accomplish a specific activity, and are packaged for retail sale. The protestant asserts that for purposes of, and explicit throughout, the HTSUS, the concept of "sets" requires that the goods comprising any set, be of two or more headings or subheadings. Protestant points out numerous headings and subheadings in several chapters of the HTSUS, in which the diverse goods making up certain sets, including toy chemistry and sewing sets, support protestant's assertion. -3-

Heading 9503, HTSUSA, applies to "other toys," i.e., all toys not specifically provided for in the other headings of chapter 95. Although the term "toy" is not defined in the tariff, the EN to chapter 95 indicates that a toy is an article designed for the amusement of children or adults. The ENs to heading 9503 indicate that, among other toys, the heading covers "[t]in soldiers and the like, and toy armaments." The ENs relate that certain toys, including "toy arms...tin soldiers, etc." are often put up in sets.

Although the ENs further indicate that toy sets may be comprised of collections of articles, the individual items of which, if presented separately, would be classified in other headings (e.g., toy chemistry and sewing sets), such articles are not the subject of this protest. While those separately classifiable items must be put up in a form which clearly indicates their use as toys, the subject items are toys, are designed to amuse, and individually would be classified only in heading 9503. Collectively, these toys complement each other and are readily combined to represent or accomplish the myriad scenarios, missions, or battles created and carried out by a child at play.

A condition precedent to the application of GRI 3 with respect to sets is that there be at least two different articles which are prima facie classifiable in different headings. Unless this condition is met, the analysis directed by GRI 3 is not triggered. The subject items clearly comprise toy sets without the analysis protestant draws from GRI 3, while asserting its applicability to the classification of all sets. Only reference to GRI 1 is necessary here. It is our determination that the subject items are collections of toys put up in sets, and are classifiable by GRI 1 in subheading 9503.70.80, HTSUSA.

With respect to whether the term "unit" means each individual toy comprising a toy set, or means the entire retail package containing a toy set, protestant relies upon Mattel, Inc. v. United States, Appeal No. 90-1279 (Fed. Cir., decided February 13, 1991). In reversing the decision of the U.S. Court of International Trade, the Court of Appeals for the Federal Circuit interpreted the term "unit" in item 912.20 Tariff Schedules of the United States (TSUS), to mean each separate article or individual toy, rather than meaning "retail package." -4-

The protestant points out that the text of the TSUS duty exemption (item 912.20) is essentially identical to the text of the corresponding HTSUS exemption, subheading 9902.71.13 (which provides in pertinent part that, if subject to a general column one rate of duty, articles [except parts] provided for in heading 9503, valued not over five cents per unit, are duty free). Protestant contends that in light of the identical provisions, there can be no doubt that the appellate court would apply the same definition of "unit" to the individual toys of this case, and that there is no legal or logical basis for Customs to find the Court's definition of "unit" inapplicable to the merchandise in this case.

While there may have been some legal or logical basis to Customs position in the Mattel case, as evidenced by the decision of the trial court and the dissenting judge on the appellate court, we are obliged to determine whether the logic of the majority in the Mattel case applies to the facts of the present protest. Upon consideration it appears that the now-expired, temporary duty-free provision in subheading 9902.71.13, provides for a wide variety of articles valued not over 5 cents per unit. If the retail package or the condition as imported is not relevant to the application of this subheading, as the Mattel appellate court majority seems to suggest, then this subheading, with virtually identical language to the provision under consideration in Mattel, supra, would likewise apply.


The plastic combat set and plastic cowboy and Indian set are classifiable in subheading 9503.70.80, HTSUSA, as "Other toys;...Other toys, put up in sets or outfits, and parts and accessories thereof: Other: Other." The general column one rate of duty is 6.8 percent ad valorem.

With respect to the application of subheading 9902.71.13, HTSUSA, Customs here interprets the term "unit" to mean the separate articles or individual toys which comprise the toy sets. Duty-free treatment of the toy sets is determined accordingly and does apply to the subject merchandise.

The protest should be denied as to the chapter 95 classification, but should be allowed with respect to the chapter 99 claim, with corresponding refund. A copy of this decision should be attached to the Form 19 to be returned to the protestant.


John Durant, Director

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