[Federal Register Volume 62, Number 245 (Monday, December 22, 1997)]
[Notices]
[Pages 66891-66893]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-33291]


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DEPARTMENT OF THE TREASURY

Customs Service


Receipt of Domestic Interested Party Petition Concerning Tariff 
Classification of Textile Costumes

AGENCY: Customs Service, Treasury.

ACTION: Notice of receipt of domestic interested party petition; 
solicitation of comments.

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SUMMARY: Customs has received a petition submitted on behalf of a 
domestic interested party requesting the reclassification of certain 
imported textile costumes. The petitioner contends that Customs is 
incorrect in classifying textile costumes which are flimsy, not 
durable, and not normal articles of wearing apparel, under subheading 
9505.90.6090, Harmonized Tariff Schedule of the United States (HTSUS), 
as ``Festive, carnival or other entertainment articles, including magic 
tricks and practical joke articles; parts and accessories thereof: 
Other: Other: Other.'' The provision is duty free under the general 
column one rate and costumes classifiable under this provision are not 
subject to quota or visa restraints. The petitioner contends that all 
imported textile costumes should be classified in Chapters 61 or 62, 
HTSUS, asserting that textile costumes are excluded from classification 
under subheading 9505.90.6090, HTSUS, pursuant to Note 1(e), Chapter 
95, which states that the chapter does not cover sports clothing or 
fancy dress, of textiles, of chapter 61 or 62. If classified under 
Chapter 61 or 62 of the HTSUS, the costumes would be dutiable and may 
be subject to quota and visa restraints. This document invites comments 
with regard to the correctness of the current classification.

DATES: Comments must be received on or before February 20, 1998.

ADDRESS: Written comments (preferably in triplicate) are to be 
addressed to U.S. Customs Service, Office of Regulations and Rulings, 
Attention: Commercial Rulings Division, 1300 Pennsylvania Avenue, NW., 
Washington, D.C. 20229. Comments submitted may be inspected at the 
Commercial Rulings Division, Office of Regulations and Rulings, located 
at 1300 Pennsylvania Avenue., NW., 3rd Floor, Washington, D.C.

FOR FURTHER INFORMATION CONTACT: Ann Segura Minardi, Textiles Branch, 
(202-927-1368).

SUPPLEMENTARY INFORMATION:

Background

    A petition has been filed under section 516, Tariff Act of 1930, as 
amended (19 U.S.C. 1516), on behalf of an American manufacturer of 
textile costumes. The petitioner contends that virtually identical 
costumes to those manufactured by petitioner are being imported into 
the U.S. and some of these textile costumes are being erroneously 
classified by Customs under subheading 9505.90.6090, Harmonized Tariff 
Schedule of the United States (HTSUS), as ``Festive, carnival or other 
entertainment articles, including magic tricks and practical joke 
articles; parts and accessories thereof: Other: Other: Other.'' The 
provision is duty free under the general column one rate and costumes 
classified under this provision are not subject to quota or visa

[[Page 66892]]

restraints. The petitioner claims that all imported textile costumes 
should be classified in Chapters 61 or 62, HTSUS, asserting that 
textile costumes are excluded from classification under subheading 
9505.90.6090, HTSUS, pursuant to Note 1(e), Chapter 95. If classified 
under Chapters 61 or 62, the costumes would be dutiable and may be 
subject to quota and visa restraints.
    Classification under the HTSUS is made in accordance with the 
General Rules of Interpretation (GRIs). 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 GRIs 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 HTSUS by offering guidance in 
understanding the scope of the headings and GRIs.
    Heading 9505, HTSUS, includes articles which are for ``Festive, 
carnival, or other entertainment.'' However, Note 1(e), chapter 95, 
HTSUS, excludes articles of ``fancy dress, of textiles, of chapter 61 
or 62'' from chapter 95. The ENs to 9505, state, among other things, 
that the heading covers:

    (A) Festive, carnival or other entertainment articles, which in 
view of their intended use are generally made of non-durable 
material. They include:
* * * * *
    (3) Articles of fancy dress, e.g., masks, false ears and noses, 
wigs, false beards and moustaches (not being articles of postiche-
heading 67.04), and paper hats. However, the heading excludes fancy 
dress of textile materials, of chapter 61 or 62.

    In interpreting the phrase ``fancy dress, of textiles, of chapter 
61 or 62,'' Customs initially took the view that fancy dress included 
``all'' costumes regardless of quality, durability, or nature of the 
item. However, Customs has reexamined its view regarding the scope of 
the term ``fancy dress'' as it relates to costumes. On November 15, 
1994, Customs issued Headquarters Ruling Letter (HQ) 957318, which 
referred to the settlement agreement of October 18, 1994, reached by 
the United States and Traveler Trading in the case of Traveler Trading 
Co. v. United States, Civil Action, #91-02-00084. In HQ 957318, Customs 
stated that it had agreed to classify as festive articles in subheading 
9505.90.6090, HTSUS, costumes of a flimsy nature and construction, 
lacking in durability, and generally recognized as not being normal 
articles of apparel.

Description of Merchandise

    The imported costumes which are the subject of HQ 957318 are of the 
same class or kind of merchandise as the costumes manufactured by 
petitioner. Costumes, whether imported or domestically manufactured, 
are traditionally worn in conjunction with the celebration of the 
Halloween festival or to costume parties. The costumes at issue are 
constructed of fabric comprised of man-made or natural fibers, but not 
of paper. The costumes usually depict a character, creature, or 
professional person, and often include accessories.

Issues Raised

    Petitioner asserts that Customs interpretation of the term ``fancy 
dress'' is incorrect since the term ``fancy dress'' is synonymous with 
the word ``costume.'' In support of this assertion, petitioner cites 
the ``Cambridge International Dictionary of English'' (1995) as stating 
that the word ``costume'' is American for the British and Australian 
term ``fancy dress.'' In addition, petitioner cites the ``Oxford 
English Dictionary'' (2d ed. 1989) as stating that the definition of 
the term ``fancy dress'' is ``[a] costume arranged according to the 
wearer's fancy, usually representing some fictitious or historical 
character.''
    The petitioner states that the Nomenclature Committee of the 
Customs Cooperation Council (predecessor to the World Customs 
Organization) considered the scope of the term ``fancy dress'' and 
determined that the proper classification for costumes was in Section 
XI. Further, a recent decision by the Canadian International Trade 
Tribunal held that the language of Note 1(e) regarding ``fancy dress, 
of textiles'' included the inexpensive costumes before the Tribunal 
because the costumes were ``arranged or made to suit the wearer's fancy 
to represent fictitious characters'' and that subheading 9505, HTSUS, 
covered ``goods [that] are more indicative of face disguises than of 
actual clothing.''
    In citing the ENs to Chapter 95, petitioner argues that the 
examples set forth as ``articles of fancy dress'' in the ENs include 
only items that act as accessories to the fancy dress but are not 
themselves ``fancy dress'' because they do not clothe the body. 
Further, petitioner claims that the phrase in the ENs, ``articles of 
fancy dress'', does not include those articles made of textile material 
and that an item of ``fancy dress'' is the actual costume, not the 
accessories.
    Petitioner states that the durability of the costume is irrelevant 
to the determination of whether a costume is an item of apparel. 
Petitioner cites the case of Admiral Craft Equip Corp. v. United 
States, 82 Cust. Ct. 162, 164, C.D. 4796 (1979), in support of their 
position that Customs should apply a ``use'' test in classifying 
textile costumes and the case of Dynamics Classics, Ltd. v. United 
States, 10 CIT 666 (1986), as setting forth factors to be considered in 
applying the ``use'' test. In the Dynamics case the court cited United 
States v. Carborundum Co., 63 CCPA 98, 102, C.A.D. 1172, 536 F.2d 373 
(1976), for stating the elements used to establish the chief use of a 
class or kind of merchandise: ``(1) the general physical 
characteristics of the merchandise; (2) the expectations of the 
ultimate purchaser, (3) the channels of trade, and (4) how it is 
advertised and used.'' According to the petitioner, application of 
these factors would require that a Halloween costume be classified as 
an article of apparel in Chapter 61 or 62.
    Finally , petitioner states that Court of International Trade (CIT) 
decisions interpreting the Tariff Schedules of the United States 
(TSUS), are inapplicable when classifying costumes under the HTSUS. 
Petitioner argues that Customs should not consider the CIT's decisions 
in Traveler Trading Co. v. United States, 713 F.Supp. 409 (CIT 1989), 
and I.C.I. Worldwide, Inc. v. United States, 14 CIT 201 (1990), because 
both were decided under the TSUS. Specifically, it is petitioner's 
contention that the courts' decisions in those cases rested on the `` * 
* * very broad and preclusive nature of the TSUS's definition of 
`toys'.'' Petitioner further asserts that the classification of 
costumes under the HTSUS is very different from the TSUS because 
costumes are never classifiable as toys under the HTSUS and costumes 
are specifically excluded from classification as articles of fancy 
dress of textiles pursuant to Note 1(e) to Chapter 95.

Comments

    Pursuant to Section 175.21(a), Customs Regulations (19 CFR 
175.21(a)), before making a determination on the matter, Customs 
invites written comments on the petition from interested parties.
    The domestic party petition, as well as all comments received in 
response to this notice will be available for public inspection in 
accordance with the

[[Page 66893]]

Freedom of Information Act (5 U.S.C. 552), 1.4, Treasury Department 
Regulations (31 CFR 1.4), and Section 103.11(b), Customs Regulations 
(19 CFR 103.11(b)), between the hours of 9:00 a.m. to 4:30 p.m. on 
regular business days, at the: U.S. Customs Service, Office of 
Regulations and Rulings, Commercial Rulings Division, 1300 Pennsylvania 
Avenue, NW., 3rd Floor, Washington, DC.

Authority

    This notice is published in accordance with Section 175.21(a), 
Customs Regulations (19 CFR 175.21(a)), 19 U.S.C. 1516.
    Drafting information: The principal author of this document was Ann 
Segura Minardi, Textiles Branch, Office of Regulations and Rulings, 
U.S. Customs Service. However, personnel from other Customs offices 
participated in its development.

    Approved: December 5, 1997.
William F. Riley,
Acting Commissioner of Customs.
Dennis M. O'Connell,
Acting Deputy Assistant Secretary of the Treasury.
[FR Doc. 97-33291 Filed 12-19-97; 8:45 am]
BILLING CODE 4820-02-P