HQ 958452

July 3, 1996

CLA-2 RR:TC:FC 958452 ALS

CATEGORY: Classification

TARIFF NO.: 7315.89.5000

Port Director of Customs

U.S. Customs Service

1 E. Bay St., Room 104

Savannah, GA 31401

RE: Request for Further Review of Protest 1704-95-100237, Dated April
28, 1995, Concerning the Classification of a Bead Key Chain with a
Miniature Plastic Box Attached Thereto

Dear Mr. Richter:

This is in reference to a protest filed against decisions of

February 10 and March 17, 1995, concerning the classification of

an item invoiced as \"Storzalots Key Chain.\"

FACTS:

The product under consideration is a composite article

consisting of a plastic box with a lid which has an appendage on

both the lid and box through which is threaded a length of

beaded/ball chain with a clasp. The box measure approximately 2

inches by 1 1/4 inches by 5/8 inch. It is a miniature replica of

a full size container marketed by the importer. The box is a

promotional, advertising type of article which is generally given

away at sales demonstration meetings known as \"parties\" where the

importer\'s products are demonstrated and sold. The imported

article, which is identified on the invoice and other entry

documents as a key chain, is not sold.

ISSUE:

What is the classification of the subject article?

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LAW AND ANALYSIS:

Classification of merchandise under the Harmonized Tariff

Schedule of the United States Annotated (HTSUSA) is governed by

the General Rules of Interpretation (GRI\'s) taken in order.

GRI 1 provides that the classification is determined first in

accordance with the terms of the headings and any relative

section and chapter notes. If GRI 1 fails to classify the goods

and if the headings and legal notes do not otherwise require, the

remaining GRI\'s are applied, taken in order.

The subject article was entered under subheading

7117.90.5000, HTSUSA, as imitation jewelry. Both the importer

and Customs at the port of entry have agreed that such

classification was erroneous. The importer has suggested that

the article should be classified in subheading 7315.89.5000,

HTSUSA, which provides for \"Chain and parts thereof, of iron or

steel: other chain: Other: Other.\" The importer notes that the

relative Explanatory Notes (EN) indicate that beaded chain is

included in this provision. The importer has alternatively

suggested that the article should be classified in subheading

7326.20.0050, HTSUSA, as other articles of steel, other.

We note that while there is agreement that the article was

incorrectly entered and liquidated, the port of entry disagrees

with the importer\'s suggested classifications. It has suggested

that the plastic box, which is attached to the key chain, forms

the essential character of the product and that classification as

an article of plastic is appropriate.

The subject article, which is invoiced as a key chain, is

similar to other promotional key chains distributed by the

importer. They are miniature replicas of products distributed by

the importer and are too small to be functional. We note that

key chains frequently have attachments, whether decorative or

functional. Articles consisting of a key chain with a decorative

attachment have been considered to have the essential character

of the key chain and have been so classified in accordance with

the provisions of GRI 3(b).

When the attachment to the chain appears to be functional a

question arises as to which component, the chain or the

attachment, forms the essential character of the article. In

Headquarters Ruling Letter 950636, dated January 16, 1992, which

covered a plastic photo frame attached to a metal key ring, we

indicated that \"the steel element of the subject key rings is

what makes up the utilitarian portion of the key rings. It is

the part that keeps keys together, which is the primary purpose

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of key rings. The plastic element is present for decorative

purposes and to add bulk to the entity.\"

Other Headquarters rulings, e.g., HRL 950980, dated January

21, 1992, regarding chains with plastic holders for credit cards

or charms attached thereto, and HRL 089282, dated August 2, 1991,

regarding a key ring with a pencil and miniature memo pad

attached thereto, held that the key chain/ring formed the basis

for classification although the attachments had functional

capabilities. However, such functional capabilities may cause a

question to arise as to which component of the product, if any,

form the essential character of the product, e.g., HRL 081193,

dated August 2, 1988, in which the attachment was a calculator

with a built-in timekeeping mechanism. In that ruling we held

that the essential character was equally dependent on the

calculator and the key chain.

A question arises as to whether the instant article has any

functional capabilities because its lid can be opened and snapped

shut. It has been suggested that the article could be used to

hold a few pills or coins. The broker, however, has advised us

that the article, which is given away as a free promotional item,

is not intended for this purpose, that the plastic hinges would

break if the article was used in such fashion and that the only

reason the plastic box opens is because it is designed to

replicate the importer\'s full-sized article. We note that if the

article were to be used as a pill box, one would have to presume

that the user would use the chain to attach the article to a belt

or some other article. We do not believe that this is the normal

course of action for the adult female consumer, to whom the

importer markets it product, or a male consumer. Our observation

is that the user of a pill box would keep it in another

container, such as a purse, or a pocket, and not attach it to a

belt of other article. In this regard, we note that the importer

has distributed other miniature replicas of its products as

promotional items and that these items are too small to be

functional. Thus, we believe that it was intended that the ball

chain function as a key chain rather than an attaching device,

that the chain is the primary functional component of the article

and that the plastic article merely serves as a reminder of the

availability of certain of the importer\'s products. Accordingly,

we have concluded that the chain is the focus for the proper

classification of the composite article and that it is not

classifiable as an article of plastic.

Since it is agreed that the article is not an article of

imitation jewelry, the questions remains as to under which of two

subheadings in chapter 73, HTSUSA, the article should classified.

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The suggested alternatives are subheading 7315.89.5000, HTSUSA,

which provides for chain and parts thereof, of iron or steel:

other chain and subheading 7326.90.8585, HTSUSA, which provides

for other articles of iron or steel. We note that subheading

7315.89.5000, HTSUSA, more specifically describes the article

under consideration. Further, the Explanatory Notes to the

Harmonized System (EN), which represent the view of the

international classification experts, specifically notes that

heading 73.15 covers ball chain. Accordingly, we have concluded

that the subject article should be classified thereunder.

HOLDING:

Ball/beaded chain with a clasp to which a miniature plastic

box is attached is considered to be a key chain and is

classifiable in subheading 7315.89.5000, HTSUSA, which provides

for Chain and parts thereof, of iron or steel: Other chain:

Other: Other.

Since reclassification of the merchandise as indicated above

will result in a lower rate of duty than the liquidated or

claimed rate you are instructed to allow the protest in full.

A copy of this ruling should be attached to the Customs Form

19 and provided to the protestant as part of the notice of action

on the protest.

In accordance with Section 3A(1)(b) of Customs Director 099

3550-065, dated August 4, 1993, Subject: Revised Protest

Directive, this decision should be provided by your office to the

protestant no later than 60 days from the date of this letter.

Any reliquidation of the entries in accordance this decision must

be accomplished prior to the mailing of the decision. Sixty days

from the date of the decision the Office of Regulations and

Rulings will take steps to make the decision available to Customs

personnel via the Customs Rulings Module in ACS and the public

via the Diskette Subscription Service, Freedom of Information Act

and other public access channels.

Sincerely,

John Durant, Director

Tariff Classification

Appeals Division