CIT Rules Certain Holiday and Special Occasion Bakeware is Duty-Free as Chapter 95 "Festive Articles
In Wilton Industries, Inc., v. U.S., the Court of International Trade ruled that certain bakeware, cookie cutters, cooking tools, etc. imported by Wilton to be used in baking and cake decorating (the "bakeware") should be classified under HTS 9505.90 (duty-free), a provision covering festive, carnival or other entertainment articles.
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Wilton sold and marketed the imported bakeware to be used in connection with traditional holidays, such as Christmas, Valentine's Day, or Halloween, or for special occasions such as birthdays, weddings or anniversaries. In both instances, the merchandise was designed and intended specifically for use in connection with a specific holiday or on such occasion.
Customs classified and liquidated the bakeware under several tariff numbers as "Table, kitchen or other household articles". Wilton contended that the bakeware should be classified as "festive articles" and as such, was expressly excluded from the classifications used by Customs.
Bakeware's utilitarian nature. The government's principal arguments against classifying the bakeware as "festive articles" were (1) that the functional or utilitarian nature of the bakeware precluded its treatment as a "festive article", and (2) that "festive articles" should be designed to be used only for traditional holidays.
2003 EN amendment excludes utilitarian articles from 9505. In addition, the government contended that the Explanatory Note to 9505 (which the CIT agreed could be consulted for guidance in classifying goods), including its 2003 clarifying amendment, should be controlling. This amendment clearly excludes "festive" articles that have a utilitarian function from classification in 9505.
Bakeware imported before 2003 EN amendment. CIT ruled 2003 EN does not apply. While the CIT acknowledged this amendment, they ruled that it had no relevance in this case, since it was enacted after the 1999 importation of the bakeware.
CIT relies on and expands court criteria. In making its decision, the CIT looked to the following criteria, which had been established by the courts in classifying goods as "festive articles" under heading 9505, (1) articles must be closely associated with a festive occasion, and (2) articles must be used or displayed principally during that festive occasion.
The CIT left any decision as to whether an article must be non-utilitarian to litigation over imports which occurred after the effective date of the amendment to the Explanatory Note.
In ruling that the bakeware should be classified as "festive articles", the CIT expanded the term "festive" under HTS 9505 to include not only traditional holidays, but also such non-holiday private occasions as birthdays, weddings, anniversaries, and baptisms.
(See ITT's Online Archives or 04/25/06 news, 06042505 for BP summary of CBP's revised guidance on the classification/protest of textile and non-textile festive articles, which listed seven pending court cases involving the classification of various articles as "festive", including this Wilton case.)
CIT Slip Op. 07-94 (dated 06/11/07) available at http://www.cit.uscourts.gov/slip_op/Slip_op07/07-94.pdf