In ruling NY N320523 (August 3, 2021), Customs and Border Protection (CBP) discussed the tariff classification of two hanging kits from China. The first hanging kit, identified as the “Home Lightweight Décor Hanging Kit/Starter Décor Kit,” consists of 43 items. This includes 28 picture hangers made of steel, 6 small poster strips which are rubber tabs with adhesives on both sides, 8 pieces of Velcro, and 1 plastic box that serves as the kit’s package. The picture hangers vary in holding capacity, being described as 10-pound, 30-pound, and 50-pound holding power nail and hook combinations. The second product is identified as the “Lightweight Hangers,” consisting of 51 items. This item includes 6 décor pins made of steel and polystyrene, 6 picture clips made of steel and polystyrene, 20 push pins made of steel and polystyrene, 2 hooks made of steel and suction cups made of silicon rubber, 16 screw hooks made of nickel-plated steel, and 1 polyproline box to hold and package the kit. Both kits are sold and marked as lightweight hanger kits for the purpose of hanging pictures, posters, and other lightweight house décor items.
CBP turned to the General Rules of Interpretation (GRIs) in order to classify the hanging kits under the Harmonized Tariff Schedule of the United States (HTSUS). GRI 1 could not be used as a basis for classification because there is no single heading in the tariff schedules that could cover all the components of the hanging kits. Alternatively, GRI 3(b) states that “mixtures, composite goods consisting of different materials or made up of different components, and 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.” Because the kits consist of different components and no essential character for the composite good can be determined, CBP referred to GRI 3(c) – which states that “classification will be determined by the heading which occurs last in numerical order among those headings which equally merit consideration.”
For the first kit, CBP found that all 43 items perform a similar function and thus merit equal consideration. For that reason, under the application of GRI 3(c), the first kit is classified according to its steel component and would be classified under subheading 7326.90.8688, HTSUS, which provides for “other articles of iron or steel, other, other…other.” The rate of duty is 2.9% ad valorem. For the second kit, CBP found that the 51 items all performed a similar function and that, under the application of GRI 3(c), the item would be classified according to its metal component. CBP determined that the second kit would be classified under 8302.50.0000, HTSUS, which provides for “Hat racks, hat pegs, brackets and similar fixtures and parts thereof, of base metal.” The rate of duty is free.
Additionally, pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, Chinese products under subheading 7326.90.8688 and 8302.50.0000, HTSUS, unless specifically excluded, are subject to an additional 25% ad valorem duty rate. As such, the chapter subheading 9903.88.03 must be reported in addition to subheading 7326.90.8688 and 8302.50.0000, HTSUS.