In ruling NY N320329 (July 16, 2021), Customs and Border Protection (CBP) discussed the classification of an electric surfboard from China that is put up in a set for retail sale. The surfboard is a designed to surf in water without it needing waves or boats to pull or push it. Rather, it is propelled by a small motor mounted underneath the board on a three-foot mast and a fin that goes into the water. The entire item is made up of the surfboard, a hydrofoil (which is the mast and fin), a battery, and a motor that is controlled by a handheld remote. Additionally, the product comes with the tools and hardware to connect the mast and fin to the surfboard.

Customs defines the term “goods put up in sets for retail sale” as goods which:

  • Consist of at least two different articles which are, prima facie, classifiable in different headings;
  • Consist of products or articles put up together to meet a particular need or carry out a specific activity; and
  • Are put up in a manner suitable for sale directly to users without repacking.

To determine the essential character of the good, CBP referred to General Rule of Interpretation (GRI) 3(b), which states “in part, that goods put up in sets for retail sale shall be classified as if consisting of the component that gives them their essential character.” CBP found that in this case the surfboard imparts that essential character of the set.

CBP determined that the applicable subheading for the electric surfboard is 9506.29.0030, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Articles and equipment for general physical exercise, gymnastics, athletics, other sports…or outdoor games…; Water skis, surf boards, sailboards and other water-sport equipment; parts and accessories thereof: Other…Surf-boards.” The rate of duty is free. Additionally, pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, Chinese products under subheading 9506.29.0030, HTSUS, unless specifically excluded, are subject to an additional 7.5% ad valorem duty rate. As such, the chapter subheading 9903.88.15 must be reported in addition to subheading 9506.29.0030, HTSUS.

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Photo of Frances P. Hadfield Frances P. Hadfield

Frances P. Hadfield is a counsel in Crowell & Moring’s International Trade Group in the firm’s New York office. Her practice focuses on forced labor and withhold release orders (WRO), import regulatory compliance, and customs litigation. She regularly advises corporations on matters involving…

Frances P. Hadfield is a counsel in Crowell & Moring’s International Trade Group in the firm’s New York office. Her practice focuses on forced labor and withhold release orders (WRO), import regulatory compliance, and customs litigation. She regularly advises corporations on matters involving customs compliance, audits, customs enforcement, as well as import penalties.

Frances represents clients before the U.S. Court of International Trade and the U.S. Court of Appeals for the Federal Circuit, as well as in proceedings at the administrative level. She advises corporations on both substantive federal and state regulatory issues that involve U.S. Customs and Border Protection, the Federal Trade Commission, Food and Drug Administration, and U.S. Fish & Wildlife in matters pertaining to product admissibility, audits, classification, import restrictions, investigations, marking, licenses, origin, penalties, and tariff preference programs.

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Photo of Martín Yerovi Martín Yerovi

Martín Yerovi is an international trade analyst in Crowell & Moring’s Washington, D.C. office. He provides practice support to the International Trade Group on import regulatory matters pending before the Office of the U.S. Trade Representative (USTR) and U.S. Customs and Border Protection…

Martín Yerovi is an international trade analyst in Crowell & Moring’s Washington, D.C. office. He provides practice support to the International Trade Group on import regulatory matters pending before the Office of the U.S. Trade Representative (USTR) and U.S. Customs and Border Protection (CBP). He works closely with attorneys developing courses of action for clients impacted by investigations under Section 301 of the Trade Act of 1974 and Section 232 of the Trade Expansion Act of 1962. He also supports unfair trade investigations, including antidumping (AD) and countervailing duty (CVD) investigations, sunset reviews, and changed circumstance reviews before the Department of Commerce and the International Trade Commission (ITC).

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