Monday, April 06, 2015

Late Ruling of the Week 2015.12: Quiver

If you read this blog regularly, you know I have a certain affinity for nerd culture and, in particular, comic book superheroes. For example, I very much like the CW incarnation of Oliver Queen's Green Arrow. I will admit that the Green Arrow books did not do much for me the last time I regularly read them. When I last checked in. Oliver/Green Arrow was fighting a mutant polar bear, or something.

If you follow Arrow on the CW, you might also like the podcast Quiver, which is both an episode recap and general discussion of the Arrow TV show. Amanda and Mike do a good job of commenting on the specific show and on the larger Arrow-related universe. Sometimes, they go a little off the deep end of fandom and "shipping" various romantic angles, but their podcast is informative and entertaining.

And, it is called "Quiver," which brings me to this post. As you likely know, a quiver is the device archers use to hold arrows. A company called Kinsey's Archery imports quivers and asked U.S. Customs and Border Protection how to classify them. The resulting ruling is NY N262341 (Mar. 25, 2015).

According to Customs, the quiver in question is a plastic container designed to provide storage, protection, organization, and portability to arrows. According to CBP, this item is classifiable in HTSUS item 4202.99.9000 as "containers or cases, other." That has a duty rate of 20% ad valorem, which is enough to hurt.

Oh the other hand, 9906.99.05 is the duty free provision for other archery articles and equipment. What gives?

The problem for Kinsey is General Rule of Interpretation 1, which requires that importers and CBP apply the relevant legal notes. Note 1(d) to Chapter 95 excludes from that chapter sports bags and other articles of Heading 4202. Thus, the question is whether anything excludes the quivers from 4202.

It turns out that Note 2(l) to Chapter 42 excludes sports equipment of Chapter 95. This creates a conundrum. Can the quiver be excluded from both headings by operation of conflicting notes? I don't think so. Rather, the way to address this is to start at the 4202. There, Note 2(l) tells us that this piece of archery equipment of Heading 9506 is excluded from Heading 4202. Since it cannot be in 4202, Note 1(d) of Chapter 95 does not preclude classification in Heading 9506. Thus, 9506 prevails.

Customs disagrees, which is why you should never treat anything you read here as legal advice. In a prior ruling, CBP directly faced this question, but only indirectly answered it. In NY N069455, Customs held that a quiver is  a case for holding arrows. From there, CBP applied Chapter 95, Note 1(d) to exclude the quiver and place it in Heading 4202.

Is CBP right? I suspect the argument goes that 9506 does not specify quivers. Thus, it is not clear that the heading was intended to cover containers of a sort specified in Heading 4202. That makes some sense. But, it strikes me as moving beyond GRI 1, which should resolve this. It is similar to a relative specify argument comparing the scope of headings. By reading the HTSUS from start to back, we stay in GRI 1 and first exclude the quiver from 4202, which means that it is not excluded from Chapter 95. End of story.

But, then why does Chapter 95 include the note excluding sports bags of Heading 4202? We can't interpret 4202 in a way that makes that exclusion meaningless. I suspect that Note is intended to exclude general purpose sports bags (think gym and yoga bags) as opposed to specialized pieces of sports equipment like quivers. That seems to be a reasonable argument to pursue.

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