Harmonized Tariff Schedule

R.T. Foods appealed a Harmonized Tariff Schedule classification case that resulted in its tempura battered vegetables being classified as vegetable preparations, dutiable at 11.2 percent, instead of as duty-free food preparations. The Court of International Trade said "vegetable preparations" specifically describes the product, which means it can’t fall into the “other” food preparations category. CIT’s ruling only applied to three of the 24 entries R.T. Foods had challenged, because the company waited too long to file its court challenge of 10 entries for which protests were denied, and lacked standing to challenge another 11 entries on constitutional grounds.

The Court of International Trade ruled that Customs correctly classified plaintiff The Pomeroy Collection’s decorative glass “pillar plates,” floor-, and wall-mounted vessels, designed for use as candle holders, as “Glassware of a kind used for . . . indoor decoration or similar purposes” under Harmonized Tariff Schedule heading 7013, dutiable at 4.3 to 18 percent. Pomeroy had attempted to argue that the merchandise was classifiable under heading 9405 (“Lamps and lighting”), or alternatively, heading 9403 (“Other furniture and parts thereof”), both of which enter duty-free from Mexico. CIT said heading 9405 did not apply because the merchandise was not shipped with candles and was not specifically designed to hold candles. Heading 9403 didn’t apply because the goods were decorative, not utilitarian, CIT said.

The International Trade Administration issued a Federal Register notice on its recently initiated countervailing duty investigation of certain frozen warmwater shrimp from China (C-570-988), Ecuador (C-331-803), India (C-533-854), Indonesia (C-560-825), Malaysia (C-557-814), Thailand (C-549-828), and Vietnam (C-552-815). The ITA will determine whether exporters of frozen warmwater shrimp from these countries to the U.S. receive countervailable subsidies.

The Court of Appeals for the Federal Circuit should uphold the lower court’s dismissal of the Rack Room Shoes v. U.S. test case on gender discrimination in Harmonized Tariff Schedule provisions, because male and female provisions in the HTS rationally differentiate between products, not people, and were put in place to meet trade policy objectives, said the government in its Jan. 17 reply brief. CAFC’s ruling on the challenge will have a hand in determining the outcome of over 160 similar cases currently before the Court of International Trade.

The International Trade Commission is asking for comments by March 4 in connection with the 2012 Annual Review of the Generalized System of Preferences. The ITC is considering the effects of adding four products to the list of articles eligible for GSP benefits, as well as competitive need limitation waivers on 12 Harmonized Tariff Schedule subheadings for certain countries. The ITC will hold a hearing in connection with its investigation on Feb. 27 in Washington, D.C.

The Court of International Trade granted the government’s motion to amend its complaint on the third try in an action seeking penalties from Active Frontier International for false country of origin statements on entry documentation. CIT denied the penalty action without prejudice in August, because the government didn’t prove that all of AFI’s misstatements were material, as required by 19 USC 1592 for imposition of a penalty. The government’s first motion to amend was denied in early October because it didn’t include the actual amended complaint, and its second motion to amend the complaint was withdrawn later that month.

CBP issued a CSMS message announcing the issuance of Harmonized System Update 1301 on changes to the 2013 Harmonized Tariff Schedule. This update contains 27,646 ABI records and 5,357 harmonized tariff records. Modifications include changes associated with the recent Informal Value Change legislation. Adjustments were made to applicable tariff numbers that no longer require a formal entry, if the value exceeds $250. The modified records are currently available to all ABI participants and can be retrieved electronically via the procedures indicated in the CATAIR. Contact Jennifer Keeling via email at Jennifer.Keeling@dhs.gov for all other questions.

The Court of International Trade ruled in favor of plaintiff GRK Canada in its challenge of CBP’s Harmonized Tariff Schedule Classification of its screws, arriving at General Rule of Interpretation 3(c) to do so. CBP had classified GRK’s screws under HTS subheading 7318.12.00 as “other wood screws,” dutiable at 12.5 percent. GRK protested, arguing its screws were instead correctly classified under HTS subheading 7318.14.10 as “self-tapping screws,” dutiable at 6.2 percent. CIT said the screws fit into both categories, and neither subheading more specifically describes the goods. So the tie went to the heading occurring last in numerical order per GRI 3(c), and GRK’s proposed “self-tapping screws” classification prevailed.

CBP issued a CSMS message reminding the trade of the recently published final rule that increased the limit for informal entries from $2,000 to $2,500. The increase takes effect Jan. 7 and applies to goods entered or released (including goods released under special privileges for immediate delivery under 19 U.S.C. 1448(b)) on or after Jan. 7.

The Court of International Trade granted the government’s motion for $1,826,531.80 in liquidated damages from lumber importer Millenium Lumber Distribution and its surety XL Specialty Insurance Co. The award was the result of a failure to obtain export permits from the Canadian government, as required by the Softwood Lumber Agreement. Millenium contended that the permits were only required because of CBP’s improper reclassification of the imported lumber through a Notice of Action, without the notice and comment period required by 19 USC 1625(c)(1). The court, however, found the ruling letters relied upon by Millenium did not apply because its merchandise was not identical, and so no notice and comment period was necessary to revoke or modify them.