Thursday, January 30, 2014

Complexities of "Coated" Textile Provision Cause CBP Reversal of Ruling, Resulting in 13.2% Additional Duty

Customs and Border Protection ("CBP") in Customs Bulletin Vol. 48 No. 4 (January 29, 2014) announced the revocation New York Ruling Letter N238691, dated February 26, 2013, with regard to the tariff classification of polyurethane coated gloves under the Harmonized Tariff Schedule of the United States ("HTSUS"). Similarly, CBP is revoking any treatment previously accorded by CBP to substantially identical transactions. Notice of the proposed action was published in the Customs Bulletin Vol. 46, No. 35, on August 22, 2012. Two comments were received in opposition to this notice. EFFECTIVE DATE: This action is effective for merchandise entered or withdrawn from warehouse for consumption on or after March 31, 2014.

At issue was whether the subject gloves are classified in heading 3926, HTSUS, as other articles of plastic, or heading 6116, HTSUS, as gloves. The gloves are described as string-knit work gloves constructed of 50% polyethylene, 29% polyester, 14% glass fiber and 7% spandex with a polyurethane coating which covers the entire palm as well as a portion of the palmside cuff and overlaps the fingers and sides of the wearer’s hands. A polyurethane coating has also been applied to the underside fabric of the palms. The glove features an elasticized cuff and an overlock stitch finish at the cuff bottom.


Classification of goods under the HTSUS is governed by the General Rules of Interpretation (GRI). GRI 1 provides that classification 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 GRIs 2 through 6 may then be applied in order.

The HTSUS provisions under consideration are as follows:

3926: Other articles of plastics and articles of other materials of headings
3901 to 3914:
3926.20: Articles of apparel and clothing accessories (including gloves, mittens and mitts): Gloves, mittens and mitts:
3926.20.10: Seamless . . . RATE OF DUTY ZERO

* * * * *

6116: Gloves, mittens and mitts, knitted or crocheted:
6116.10: Impregnated, coated or covered with plastics or rubber:
Without fourchettes:
6116.10.55: Containing 50 percent or more by weight of cotton, man-made fibers or other textile fibers, or any combination thereof . . . . RATE OF DUTY 13.2%

* * * * *

Legal Note 1 to Section XI provides, in pertinent part: 1. This section does not cover: (h) Woven, knitted or crocheted fabrics, felt or nonwovens, impregnated, coated, covered or laminated with plastics, or articles thereof, of chapter 39;

Note 2 to Chapter 39 provides as follows: 2. This chapter does not cover: (p) Goods of section XI (textiles and textile articles);

Note 2 to Chapter 59 provides, in pertinent part: 2. Heading 5903 applies to:

(a) Textile fabrics, impregnated, coated, covered or laminated with plastics, whatever the weight per square meter and whatever the nature of the plastic material (compact or cellular), other than (emphasis added):

. . .

(3) Products in which the textile fabric is either completely embedded in plastics or entirely coated or covered on both sides with such material, provided that such coating or covering can be seen with the naked eye with no account being taken of any resulting change of color (chapter 39);

. . .

(5) Plates, sheets or strip of cellular plastics combined with textile fabric, where the textile fabric is present merely for reinforcing purposes (Chapter 39).

* * * * *

Note 2(p) to Chapter 39, HTSUS, states that the Chapter does not cover goods of Section XI (textiles and textile articles). Note 1(h) to Section XI, however, excludes, inter alia, articles of knitted or crocheted fabrics coated, covered, impregnated or laminated with plastics, of Chapter 39. Although these notes would appear to conflict, Note 2 to Chapter 59, HTSUS, clarifies the scope of Chapter 39 with regard to textiles coated with plastics and sets out definitive criteria for the determination of which fabrics that have been impregnated, coated, covered, or laminated with plastics are classifiable in Chapter 39, HTSUS, at GRI 1, and thus excluded from Section XI.

Note 2(a)(3) to Chapter 59 directs the classification of textile articles in which the textile fabric is either “completely” embedded or “entirely coated or covered on both sides” by plastics to Chapter 39.

Customs found that the gloves are covered only on the inside and outside of the palmside, not including the wrist cuff, and on a portion of the backside fingers (inside and outside). The remainder of the gloves, including the entire back side, are composed of non-coated textile fabric. Thus, the gloves are only partially covered or coated with plastic and are not described by Note 2(a)(3) to Chapter 59 or heading 3926, HTSUS.

It was argued that the textile material of the instant gloves is present only for reinforcing purposes, and that the gloves should therefore be classified in Chapter 39 pursuant to Note 2(a)(5) to Chapter 39. Customs responded that the gloves are not subject to Note 2(a)(5) because they are not combined with cellular plastic. They are governed instead by Note 2(a)(3) to Chapter 59, HTSUS. In any case, however, the textile component of the instant gloves is present for more than mere reinforcement. The plastic coating may be said to reinforce the textile because it makes the textile substrate less permeable and more resistant to cuts or abrasions. However, it is meaningless to say that the textile fabric is reinforcing the plastic coating. The substrate of the gloves is entirely constructed of textile. The textile gives the gloves their form and shape, thickness, strength, etc. The textile material also provides stretch and give to the gloves, allowing them to be put on, used and removed without difficulty. In addition, the textile material, being more permeable than plastic, permits the gloves to be worn more comfortably, because it traps less perspiration than the plastic material.

Heading 6116, HTSUS, provides for gloves. Although heading 6116, HTSUS, is in Section XI, it is only the heading text which controls, not the Chapter or Section titles. Thus, heading 6116, HTSUS, is not limited to textile gloves only. Indeed, the heading text does not limit the classification of gloves of that heading by the material of their construction, only the method of construction (i.e., the glove must be knitted or crocheted). Thus, heading 6116, HTSUS, includes gloves of textiles and plastics, or textiles coated with plastics. The instant glove is made entirely of a knit textile material which is subsequently coated with plastic. At GRI 1, heading 6116, HTSUS therefore captures the merchandise in its entirety.

Even if the gloves were not excluded from Chapter 39 on the basis of Note 2(p) to that Chapter, the EN to heading 3926, HTSUS, indicates that the heading includes only plastic articles not described more specifically elsewhere in the tariff schedule. Heading 6116, HTSUS, provides for “gloves”, a considerably more specific description of the merchandise than “other article of plastic.” As the subject gloves are more specifically provided for in heading 6116, HTSUS, they are precluded from classification in heading 3926, HTSUS. Customs further noted that although subheading 3926.20, HTSUS, also provides for gloves of plastic, the instant articles must first meet the terms of the heading before we can consider the application of the accompanying subheadings. As the subject merchandise is not properly classifiable at the four digit level in heading 3926, HTSUS, it is improper to invoke subheading 3926.20, as only the four digit headings are comparable. Furthermore, subheading 6116.10, HTSUS, also provides for gloves impregnated or coated with plastics. It is therefore clear that gloves impregnated with plastics are not automatically or even primarily classified in heading 3926, HTSUS. The relevant chapter, section and explanatory notes clarify when it is appropriate to classify such merchandise in heading 3926, HTSUS—e.g., when they are coated entirely on both sides by plastic, or when the textile material is merely present for reinforcement. For the complete CBP announcement of revocation, including full analysis, click here, beginning at page 106

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