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HQ 964860

August 20, 2001

CLA-2 RR:CR:TE 964860 JFS


TARIFF NO.: 4820.10.2010, HTSUSA

Port Director
U.S. Customs Service
C/O Chief, Residual Liquidation and Protest Branch 6 World Trade Center, Room 761
New York, NY 10048-0945

RE: Decision on Application for Further Review of Protest No. 1001-00-100981; Classification of Diary/Clutch; Exclusionary note 1(h) to Chapter 48; Composite Good.

Dear Madam:

This is a decision on an application for further review (AFR) of a protest timely filed on March 2, 2000, by Serko & Simon, LLP, on behalf of Westport Corporation. The Protest concerns the classification and liquidation of an entry of diary/clutch composite goods entered in October 1999.


You classified the merchandise in subheading 4202.22.8050, Harmonized Tariff Schedule United States Annotated (HTSUSA), the provision for “Trunks, suitcases . . . knapsacks and backpacks, handbags,. . . wallets, purses, . . . and similar containers . . .: Handbags, whether or not with shoulder strap, including those without handle: With outer surface of sheeting of plastic or of textile materials: With outer surface of textile materials: Other: Other: Other, Of man made fibers” with a general column one duty rate of 18.8 percent ad valorem.

The protestant claims that the goods should be classified in subheading 4820.10.4000, HTSUSA, the provision for “Registers, account books, notebooks, order books, receipt books, letter pads, memorandum pads, diaries and similar articles: Other.” Alternatively, the protestant claims that the goods should be classified in subheading 4820.10.2050, HTSUSA, the provision for “Registers, account books, notebooks, order books, receipt books, letter pads, memorandum pads, diaries and similar articles: Diaries, notebooks and address books, bound; memorandum pads, letter pads and similar articles; Other,” with a general column one duty rate of 2 percent ad valorem.

The item under consideration, style #302996/653, measures approximately 7-½ inches by 5 inches by 2 inches in depth, in the closed position. It is comprised of a man-made textile case with a six-ring binder permanently affixed at the spine. It is secured by a snap closure. The binder secures paper inserts that form the “Super Mundex Planner” which is a daily planning system. The planning system has tabs and inserts for: (1) a “Daily Planner” that consists of yearly calendars for 1999, 2000, and 2001, a large foldout yearly calendar, a list of important dates and a daily planner; (2) “Things To Do”; (3) “Health & Fitness”; (4) “Reference”; (5) “Web Sites”; and (6) a phone book.

The interior left side of the item has an almost full length open, flat, slot pocket, on top of which, at the bottom, is an open pocket. At the top of the slot pocket is a textile band that holds a nearly flat ballpoint pen.

The interior right side of the item has a zippered case affixed to it, over which are six slots and one mesh slot for an identification card. The case measures approximately 4-½ inches by 7-½ inches by ¾ inch when closed. It has a zippered closure that extends along three sides. When opened, gussets expand the case, allowing for easy access to the compartments inside. The inside is divided into two gusseted main compartments by a zippered pouch that runs the length of the center of the item. This zippered compartment is gusseted on one side which allows it to hold coins and other small, narrow items. Each of the main compartments has a four-slot compartment for credit cards or similar objects. Each of the main compartments also has a full-length pocket.


Is the diary/clutch classified as a handbag under heading 4202, HTSUSA, or as a diary or similar article of stationary under heading 4820, HTSUSA?


Classification under the HTSUSA 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.

Among other goods, heading 4202, HTSUSA, provides for handbags, traveling bags, and similar containers. Subheading 4202.22.8050, HTSUSA, provides for handbags with an outer surface of textile materials of man-made fibers. In Headquarters Ruling Letter (HQ) 961942, dated October 26, 1999, Customs ruled upon an “ensemble clutch” “that has a three-sided zippered compartment with a double gusseted full width pocket that creates an inner space suitable for carrying 3-dimensional objects.” Customs classified the clutch in subheading 4202.21.6000, HTSUSA, as a handbag with an outer surface of leather. The gussetted case attached to the right interior side of the planner is similar to the clutch described in HQ 961492, and if classified separately, it would be classified in subheading 4202.22.8050, HTSUSA, as a handbag with an outer surface of man-made fibers.

Customs has classified day planners or organizers similar to the diary portion of the instant article as diaries under heading 4820, HTSUSA. See HQ 955516, dated April 8, 1994. Heading 4820, HTSUSA, provides in part for diaries, notebooks, memorandum pads and other articles of stationery, of paper or paperboard. Because portions of the article under consideration are prima facie classifiable under headings 4202 and 4820, HTSUSA, we must decide under which heading the article should be classified.

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. Legal note 1(h) to Chapter 48 provides that: “This chapter does not cover: articles of heading 4202 (for example, travel goods).” Herein lies the conflict of this case. If GRI 1 is strictly construed, and chapter note 1(h) is applied prior to application of the remaining GRI, then the article cannot be classified under heading 4820, HTSUSA. This would be so without regard to which features of the article impart the essential character and which subheading more specifically describes the article.

In Avenues in Leather, Inc. v. United States, 11 F. Supp. 2d 719 (1998), the Court of International Trade (CIT) considered the proper classification of folios that were zippered on three sides, had gusseted compartments, and contained a three ring binder down the spine. The folios were imported with a paper pad inserted in one of the pockets. The competing provisions were subheading 4202.11.00, and subheading 4820.10.20, HTSUSA. Subheading 4202.11.00 provides for:

Trunks, suitcases, vanity cases, attache cases, briefcases, school satchels and similar containers: With outer surface of leather, of composition leather, or of patent leather.

Subheading 4820.10.20 provides for:

Registers, account books, notebooks, order books, receipt books, letter pads, memorandum pads, diaries and similar articles: Diaries, notebooks and address books, bound; memorandum pads, letter pads and similar articles.

The CIT conducted an analysis of the articles in accordance with GRI 1 and concluded that “given the articles’ similarity to the briefcase and attache cases exemplars in subheading 4202.11.00, HTSUSA, Customs’ classification [under heading 4202, HTSUSA,] was correct.” Id. at 724. Additionally the Court found that the articles “are not diaries or similar to diaries within the common understanding of that term. However, the CIT stated that even if the provisions in Chapter 48 described the articles, the merchandise would be excluded from classification in that Chapter. The Court applied note 1(g) (now note 1(h)) to Chapter 48, which provides that the chapter does not cover articles of heading 4202. The Court, strictly applying the provisions of GRI 1, concluded that “items that can be classified under Heading 4202 are specifically excluded from classification under all of Chapter 48. . . .” The CIT further stated that “the exclusionary note applies and precludes classification within Chapter 48 without the necessity of resorting to further GRIs.” Id, at 726.

The CIT, by stating that exclusionary note 1(g) to Chapter 48 prevented resolution pursuant to the remaining GRI, failed to consider the decision of the Court of Appeals for the Federal Circuit in Sharp Microelectronics Technology, Inc. v. United States, 122 F.3d 1446 (Fed. Cir. 1997). In Sharp, the CAFC was called upon to decide whether it is appropriate, when there is an exclusionary note similar to note 1(h) to Chapter 48, to conduct analysis by application of the remaining GRI. In finding for Appellant Sharp on this limited issue, the CAFC stated:

. . . the Court of International Trade in essence used Note 1(m) as a “tie-breaker” in concluding that subheading 9013.80.60 is more specific than the parts provision in subheading 8473.30.40. Sharp argues that such use of Note 1(m) means that whenever an article could fit under Chapter 90 or Chapter 84, Chapter 90 would prevail, even if the heading or subheading under Chapter 90 also included an article that is more specifically provided for in Chapter 84, and the particular article in dispute unquestionably is more specifically provided for under Chapter 84.

The CAFC rejected a strict application of the exclusionary note and concluded by stating that “[w]e prefer the complementary role which we assign to Note 1(m) in the setting of this case.”

The CAFC’s treatment of exclusionary notes in Sharp was raised on appeal by Avenues in Leather, Inc. The Appellant argued to the CAFC that the CIT committed reversible error when it used Note 1(g) to Chapter 48 to preclude classification of the folios in heading 4820, HTSUSA, in contravention of the CAFC’s decision in Sharp. Thus, the CAFC was faced with deciding whether its prior ruling in Sharp, that note 1(m) to section XVI is complementary as opposed to mandatory, applies, as well, to note 1 (g) to Chapter 48. The CAFC paraphrased its decision in Sharp, and applied it to exclusionary note 1(g), stating that “provisions such as Note 1(g) are simply interpretive tools that ‘complement the rule of relative specificity’ rather than obviate substantive analysis.” The CAFC then found that since the CIT had already determined that the folios were not properly classified under heading 4820, the Court’s citation to Note 1(G) did not contradict the CAFC’s decision in Sharp. Avenues in Leather, 178 F.3d at 1246.

Accordingly, pursuant to the CAFC’s decisions in Sharp and Avenues in Leather, note 1(h) to Chapter 48 does not preclude application of the remaining GRI. Consequently, classification of the article in heading 4820, HTSUSA, can be considered.

The CAFC’s decision in Avenues in Leather, by operation of law, modified Customs rulings that were contrary to, and that were issued prior to, the CAFC’s decision.

GRI 3 is utilized when, by application of GRI 2(b), a good consists of materials or components which are prima facie classifiable under two or more headings. In such a case, classification of the goods shall be effected as follows:

(a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods.

(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.

(c) When goods cannot be classified by reference to 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.

Headings 4202 and 4820, HTSUSA, are equally specific in relation to one another. Each heading encompasses a limited class of goods. Moreover, these headings describe only a portion of the physical characteristics incorporated into the article under consideration. Thus, we cannot resolve the classification of these items on the basis of GRI 3(a).

In HQ 963879, dated June 19, 2001, the importer contended that articles like the one under consideration are not prima facie classifiable in heading 4202, HTSUSA, because they are “more than” any of the articles enumerated in heading 4202, HTSUSA. The CAFC has explained the “more than” doctrine as follows: “When goods constitute more than a particular article because they possess additional significant features or perform additional nonsubordinate functions, they are not classifiable as that article.” JVC v. Company of America v. United States, 234 F.3d 1348, 1353 (Fed. Cir. 2000). This argument is consistent with the decision of the CAFC in Avenues in Leather, which applied the “more than” doctrine. The CAFC stated that “[t]hese folios are plainly far more than simply diaries or address books, and thus cannot properly be classified in heading 4820.” Avenues in Leather, 178 F.3d at 1246. However, the “more than” doctrine can no longer be applied when determining which component of an article imparts the essential character. In JVC, the CAFC ruled that “the ‘more than’ doctrine, having been supplanted by the GRIs, does not apply to cases arising under the HTSUS.” JVC, at 1353. Therefore, we must determine which component of the article imparts the essential character as required by the terms of GRI 3(b).

The Harmonized Commodity Description and Coding System Explanatory Notes (EN), represent the official interpretation of the Harmonized System at the international level (for the headings and the 6 digit subheadings) and facilitate classification under the HTSUSA by offering guidance in understanding the scope of the headings and GRI. The EN, although not dispositive or legally binding, provide a commentary on the scope of each heading of the HTSUSA, and are generally indicative of the proper interpretation of these headings.

According to Explanatory Note VIII to GRI 3(b):

The 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 a constituent material in relation to the use of the goods.

The EN to heading 4820 state, in pertinent part, that:

This heading covers various articles of stationery, other than correspondence goods of heading 4817 and the goods referred to in Note 9 to this Chapter. It includes:

(1) Registers, account books, note books of all kinds, order books, receipt books, copy books, diaries, letter pads, memorandum pads, engagement books, address books and books, pads, etc., for entering telephone numbers.

(3) Binders designed for holding loose sheets, magazines, or the like (e.g., clip binders, spring binders, screw binders, ring binders), and folders, file covers, files (other than box files) and portfolios.

(8) Book covers (binding covers and dust covers), whether or not printed with characters (title, etc.) or illustrations.

The goods of this heading may be bound with materials other than paper (e.g., leather, plastics or textile material) and have reinforcements or fittings of metal, plastics, etc.

The article under consideration, with its detailed and extensive inserts, contains many of the features of the items listed in the EN to heading 4820. The “daily planner” functions as an engagement book and diary. The “communication” insert is similar to a note pad or memorandum pad. The “projects” insert is similar to a notebook. The “expenses” insert is similar to an account book. The “goals” insert is similar to a note book and an engagement book. The alphabetized inserts for telephone numbers are similar to an address book. Additionally, the item comes with a note pad and pads are listed in the EN. Further, the six-ring binder designed for holding the inserts as well as the note pad, meets the description of “[b]inders designed for holding loose sheets . . . (e.g., . . . ring binders).” Finally, like the article under consideration, goods classifiable within the heading may be bound with textile materials and have reinforcements or fittings of metal or plastics.

Heading 4202, HTSUSA, provides in part for attache cases, briefcases and similar containers. In prior ruling letters, we have concluded that portfolio diaries, organizers, agendas or planners are not classifiable in heading 4202, HTSUSA. For example, in HQ 950325, dated December 27, 1991 (modified as to unrelated grounds in HQ 953143, dated January 11, 1993), we addressed the classification of an organizer consisting of a leather case enclosing a six-ring binder, with paper inserts for personal record keeping. In that decision, we stated:

We do not believe that heading 4202, HTSUS, describes a type of merchandise which would bring these goods within the "similar containers" of that heading. Although the "planner" may appear to be related to the containers of heading 4202, HTSUS, they are not similar in that they are not designed or intended for use in a similar manner, nor do they exhibit the requisite physical attributes that Customs has found common to goods of heading 4202, HTSUS.

See also HQ 950397, dated January 23, 1992. Thus, we have determined that diaries, organizers, agendas or planners are generally not classified in heading 4202 as they are not used in a manner similar to, nor do they possess the physical characteristics of, articles of that heading.

The EN to heading 4202, HTSUSA, state that “the heading covers only the articles specifically named . . . and similar containers.” Under the rule of ejusdem generis, where an enumeration of specific things is followed by a general word or phrase, the general word or phrase is held to refer to things of the same kind as those specified. With respect to the broad reach of the residual provision for “similar containers” in heading 4202, HTSUSA, the courts have found that the rule of ejusdem generis requires that the imported merchandise possess the essential characteristics or purpose that unite the articles enumerated in order to be classified under the general term. Totes, Inc. v. United States, 18 Ct. Int’l Trade 919, 865 F. Supp. 867, 871 (1994), aff’d, 69 F.3d 495 (1995). In Totes, the Court of Appeals for the Federal Circuit (CAFC) affirmed the Court of International Trade’s determination that the “essential characteristics and purpose of Heading 4202 exemplars are. . . to organize, store, protect and carry various items.”

The handbag component of the instant article shares the essential characteristics of the containers listed in heading, 4202, HTSUSA. Due to the large size of the diary/planner, however, it is unlikely that someone setting out to purchase a handbag like the one this article includes, will decide to purchase this article. On the other hand, the consumer who is looking to purchase a diary/planner, will view the added handbag feature as a bonus. It is unlikely that the handbag component would deter the purchase of the article. Thus, while the handbag component may be a selling factor, it is not the main reason for purchasing the article.

The physical characteristics that the article possesses conforms with those described in heading 4820, HTSUSA, are detailed in the EN, and have been relied upon in previous rulings to classify similar articles under heading 4820, HTSUSA. The diary component comprises most of the bulk and weight of the item, is the most visible and, most importantly, is the primary reason the item would be purchased. Accordingly, the diary/planner component imparts the essential character to the imported article. The subject article is classified in subheading 4820.10.2010, HTSUSA.


The planner, style #302996/653, is classified in subheading 4820.10.2010, HTSUSA, which provides for “Registers, account books, notebooks, order books, receipt books, letter pads, memorandum pads, diaries and similar articles: Diaries, notebooks and address books, bound; memorandum pads, letter pads and similar articles: Diaries and address books.” The general column one rate of duty (in 1999) is 2 percent ad valorem.

The protest should be ALLOWED. In accordance with Section 3A (11) (b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you are to mail this decision, together with the Customs Form 19, to the protestant no latter than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.

Sixty days from the date of the decision, the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.ustreas, by means of the Freedom of Information Act and other public access channels.


John Durant, Director
Commercial Rulings Division

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