FDRA Calls for CBP to Update Tariff Classification Definitions for Athletic Footwear
CBP should update its footwear definitions so that old-fashioned “athletic” shoes like Converse’s Chuck Taylor All-Stars and P-F Flyers, as well as infant shoes and even dress shoes, are no longer classified under tariff provisions for athletic footwear, the Footwear Distributors and Retailers of America suggested in a letter to CBP's Office of Regulations and Rulings (here). “At a point in the distant past, this footwear was in fact used for athletic purposes,” FDRA President Matt Priest said in the letter, alluding to those Converse brands. “However, at present, use for that purpose would be fugitive.”
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CBP's 2012 informed compliance publication on footwear defines athletic shoes as including "lightweight 'sneaker' type flexible soled footwear capable of being used in athletic activities requiring fast footwork or extensive running," FDRA noted. As a result of this definition and others handed down by the agency over the years, some shoes with flexible soles and an athletic appearance are consistently classified as athletic footwear under subheading 6404.11 of the U.S. tariff schedule. However, in other countries the same shoes are classified under subheading 6404.19, for “other footwear with outer soles of rubber or plastics.”
"This is incorrect and FDRA urges that CBP's understanding of what constitutes athletic footwear be updated and clarified," the letter said. Designation as athletic or non-athletic has varying overall effects on duty rates, so revenue isn’t a significant driver of FDRA’s inquiry, Priest said. For example, an athletic classification results in lower duties for textile upper athletic shoes providing protection against cold or inclement weather, but in higher tariffs for when the value of footwear is above $12.
To be classified as athletic, shoes must have features making them “particularly suitable” for such use, which doesn’t include the less strenuous activity of walking, Priest said. “CBP’s current approach leads to the classification as athletic footwear that is neither designed, intended, nor suitable for use in athletic pursuits,” he said. The mere fact that a shoe has a flexible sole and/or a “general athletic appearance” isn’t enough to deem footwear as athletic, Priest asserted. "The fact that a shoe has a flexible, lightweight sole is hardly an indication of athletic use," he said. "Even men's dress shoes are advertised as having a lightweight flexible sole." While “there is agreement” that an outsole can show suitability for athletic use, rulings broadly define what constitutes an “athletic outsole,” and at least some “textured,” non-treaded outsoles aren’t suitable for athletic purposes, Priest said. Furthermore, a foxing or “foxing-like band” doesn’t indicate suitability for athletic use, Priest said.
“FDRA’s view is that neither general appearance nor one or two characteristics shared with athletic footwear is a sufficient basis on which to classify footwear as athletic,” the letter says. “Other factors should be taken into consideration,” including how the footwear is marketed. FDRA acknowledged that its suggestion to change tariff classification would be “substantial” for the manner in which CBP designates footwear as athletic or non-athletic, and Priest said the association “would be happy” to meet with Myles Harmon, director of regulations and rulings at the Commercial and Trade Facilitation Division of CBP's Office of International Trade, or Harmon's designee, to discuss the proposal, give appropriate samples, and to “generally review the issue.” CBP didn’t comment.