Rule 6 Subheading rule

For legal purposes, the classification of goods in the
subheadings of a heading shall be determined
according to the terms of those subheadings and any
related Subheading Notes and, mutatis mutandis, to
the above Rules, on the understanding that only
subheadings at the same level are comparable. For the
purposes of this Rule the relative Section and Chapter
Notes also apply, unless the context otherwise requires.

GRI 6 is the last of the GRIs. It prescribes that, for legal purposes, GRIs 1 to 5 govern,
mutatis mutandis (or with the necessary changes), classification at subheading levels
within the same heading. Or, in other words, GRIs 1 to 5 are to be reapplied to
determine the classification of goods at the subheading level. Goods are to be classified
at equal subheading levels (that is, at the same digit level) within the same heading
under the subheading that most specifically describes or identifies them (or as
otherwise required or directed under GRIs 1 to 5). Only subheadings at the same level
within the same heading are comparable (i.e., no consideration should be given to the
terms of any subheading within another subheading when considering the proper
classification of merchandise at the higher level subheading).

EXAMPLE 1: A framed glass mirror is found to be classified in heading
7009. Thereafter, it would have to be classified within the subheading
structure of that heading by application of GRIs 1 to 5 pursuant to GRI 6:

Initially, a determination would need to be made as to whether the framed
glass mirror is classified at the 5-digit (or “one-dash”) subheading level in
5-digit subheading 7009.1 (“rear-view mirrors for vehicles”) or in 5-digit
subheading 7009.9 (“other”). If the product is found to be classified in 5-
digit subheading 7009.1 (as a rear-view mirror for a vehicle), then the
classification analysis would end there and the product would be classified
in subheading 7009.10 (as 5-digit subheading 7009.1 is not further
subdivided). In the instant case, the framed glass mirror does not satisfy
the article description for 5-digit subheading 7009.1. Therefore, the
product would be classified at the 5-digit subheading level in 5-digit
subheading 7009.9 (as a glass mirror other than a rear-view mirror for a
vehicle). Next, a determination would have to be made as to whether the
product is classified at the 6-digit (or “two-dash”) subheading level within
5-digit subheading 7009.9 in 6-digit subheading 7009.91 (as an unframed
glass mirror other than a rear-view mirror for a vehicle) or in 6-digit
subheading 7009.92 (as a framed glass mirror other than a rear-view
mirror for a vehicle). The framed glass mirror would be classified in
subheading 7009.92 by application of GRI 1 pursuant to GRI 6.

EXAMPLE 2: A set consisting of a shovel, fork, and pick for use in
gardening would be classified in heading 8201 as each article is
specifically provided for in the terms to that heading. Within heading
8201, shovels are provided for in subheading 8201.10, forks in
subheading 8201.20, and picks in subheading 8201.30. Consequently,
one would need to resort to GRI 3 pursuant to GRI 6 in order to classify
the set at the subheading level within heading 8201. That is, one would
need to determine which of the three articles imparts the essential
character to the set pursuant to GRI 3 (b). If no one article is found to
impart the essential character to the set, then one would classify the set
under subheading 8201.30 because the subheading number for that
article occurs last in numerical order as provided for in GRI 3 (c).

As evident from the above discussion, the GRIs provide that goods must first be
classified by heading level, and only after the appropriate heading has been
determined, then by equal subheading levels (first by five-digit and then by six-digit
international levels) within that heading. When considering the appropriate
classification at a particular subheading level, no consideration should be given to any
of the terms of any lower-level subheading (as the analysis at each subheading level
should be conducted without consideration of the terms of any lower-level subheading
provision). This step-by-step analysis applies without exception throughout the
Harmonized System (and throughout any national subheading levels as found in a
particular country’s Harmonized System-based tariff system).

EXPLANATORY NOTE for RULE 6

(I) Rules 1 to 5 above govern, mutatis mutandis, classification at subheading
levels within the same heading.

(II)For the purposes of Rule 6, the following
expressions have the meanings hereby assigned to them :

(a) “subheadings at the same level” : one-dash subheadings (level 1) or
two-dash subheadings (level 2).

Thus, when considering the relative merits of two or more one-dash
subheadings within a single heading in the context of Rule 3 (a),
their specificity or kinship m relation to a given article is to be assessed
solely on the basis of the texts of the competing one-dash subheadings.
When the one-dash subheading that is most specific has been chosen
and when that subheading is itself subdivided, then, and only then,
shall the texts of the two-dash subheadings be taken into consideration
for determining which two-dash subheading should be selected.

(b)”unless the context otherwise requires” : except where Section or
Chapter Notes are incompatible with subheading texts or Subheading
Notes. This occurs, for example, in Chapter 71 where the scope assigned
to the term “platinum” in Chapter Note 4 (B) differs from that assigned to
“platinum” in Subheading Note 2. For the purpose of interpreting
subheadings ‘7110.11 and 7110.19, therefore, Subheading Note 2 applies
and Chapter Note 4 (B) is to be disregarded.

(III)The scope of a two-dash subheading shall not extend beyond that of the
one-dash subheading to which the two-dash subheading belongs; and the
scope of a one-dash subheading shall not extend beyond that of the heading
to which the one-dash subheading belongs.

Rule 5 Containers

IN ADDITION TO THE FOREGOING PROVISIONS, THE
FOLLOWING RULES SHALL APPLY IN RESPECT OF THE GOODS
REFERRED TO THEREIN:

GRI 5 has two sections: GRI 5 (a) and GRI 5 (b).
These two sections deal with various types of containers presented with
the articles for which they are intended.

Rule 5 (a) Special containers

(a) CAMERA CASES, MUSICAL INSTRUMENT CASES, GUN CASES,
DRAWING INSTRUMENT CASES, NECKLACE CASES AND SIMILAR
CONTAINERS, SPECIALLY SHAPED OR FITTED TO CONTAIN A
SPECIFIC ARTICLE OR SET OF ARTICLES, SUITABLE FOR LONGTERM
USE AND ENTERED WITH THE ARTICLES FOR WHICH THEY
ARE INTENDED, SHALL BE CLASSIFIED WITH SUCH ARTICLES
WHEN OF A KIND NORMALLY SOLD THEREWITH. THIS RULE DOES
NOT, HOWEVER, APPLY TO CONTAINERS WHICH GIVE THE WHOLE
ITS ESSENTIAL CHARACTER;

GRI 5 (a) deals with the treatment of long-term use cases, boxes, and similar containers
presented with the articles for which they are intended. Under this rule, long-term use
containers imported with articles for which they are intended to be used are to be
classified with the articles if they are of a kind of container normally sold with such
articles (e.g., camera cases with cameras and musical instrument cases with musical
instruments). This rule, however, does not apply to containers that give the imported
article its essential character (e.g., a silver tray or dish containing tea or a high-quality
ornamental ceramic bowl containing candies or sweets). Such merchandise is to be
classified under the heading for the container.

EXAMPLE1: Violin(HS9202) with case(4202)

Retrieved from: HARMONIZED COMMODITY DESCRIPTION and CODING SYSTEM or  HARMONIZED SYSTEM(HS)

Packing materials and packing containers entered with the
goods therein shall be classified with the goods if they are of
a kind normally used for packing such goods.

Violin with a case would be classified as Violin(HS9202) if the items
satisfie Rule 5(a).

 

EXAMPLE2:Gumball with toy packaging

Retrieved from: HS Classification by Japan customs

It seems that it satisfies Rule 5(a) but in this situation Gumball and toy packaging
should be classified separately because of Rule 5(a) states that,
THIS RULE DOES NOT, HOWEVER, APPLY TO CONTAINERS WHICH GIVE THE WHOLE
ITS ESSENTIAL CHARACTER;

Toy packaging gives the whole it’s an essential character.
Therefore Gumballs are classified HS1704
The toy packaging is classified HS9503 as Toy.

EXPLANATORY NOTE for RULE 5(a)

(I)This Rule shall be taken to cover only those containers which :

(1) are specially shaped or fitted to contain a specific article or set of
articles, i.e., they are designed specifically to accommodate the
article for which they are intended. Some containers are shaped in
the form of the article they contain;

(2) are suitable for long-term use, i.e., they are designed to have
durability comparable to that of the articles for which they are intended.
These containers also serve to protect the article when not in use
(during transport or storage, for example). These criteria enable them
to be distinguished from simple packings;

(3) are presented with the articles for which they are intended, whether
or not the articles are packed separately for convenience of transport.
Presented separately the containers are classified in their appropriate
headings;

(4) are of a kind normally sold with such articles; and

(5) do not give the whole its essential character.

(II)Examples of containers, presented with the articles for which they are intended,
which are tole classified by reference to this Rule are :

(1)Jewelry boxes and cases (heading 71.13);
(2)Electric shaver cases (heading 85.10);
(3)Binocular cases, telescope cases (heading 90.05);
(4)Musical instrument cases, boxes and bags (e.g., heading 92.02);
(5)Gun cases (e.g., heading 93.03).

(III) Examples of containers not covered by this Rule are containers such as a
silver caddy containing tea, or an ornamental ceramic bowl containing sweets.

 

Rule 5 (b) Packing materials & containers

(b) SUBJECT TO THE PROVISIONS OF RULE 5(a) ABOVE, PACKING
MATERIALS AND PACKING CONTAINERS ENTERED WITH THE
GOODS THEREIN SHALL BE CLASSIFIED WITH THE GOODS IF
THEY ARE OF A KIND NORMALLY USED FOR PACKING SUCH
GOODS. HOWEVER, THIS PROVISION IS NOT BINDING WHEN SUCH
PACKING MATERIALS OR PACKING CONTAINERS ARE CLEARLY
SUITABLE FOR REPETITIVE USE.

GRI 5 (b) states that packaging containers and materials not normally intended to be
reused are classified with the articles in which they are presented or imported (e.g.,
cardboard boxes or containers containing food products). This rule, however, does not
apply to packaging materials or packing containers clearly suitable for repetitive use
(e.g., certain metal drums or containers of iron or steel for compressed or liquefied gas).
Such containers are to be classified separately from the materials that they hold.

Example1: Men’s shirts individually sealed in a polybag then packed in cardboard boxes

Retrieved from: HARMONIZED COMMODITY DESCRIPTION and CODING SYSTEM or  HARMONIZED SYSTEM(HS)

In this situation, Men’s shirts with the cardboard box are entirely classified
as shirts.

 

EXAMPLE2: Gumball dispensing machine

Gumball dispensing machine (predominantly of zinc alloy) imported with gumballs.
It is designed to accept a coin and release a candy.

It seems that it satisfies Rule 5(b), but in this situation Gumball and dispensing machine
should be classified separately because of Rule 5(b) states that,
HOWEVER, THIS PROVISION IS NOT BINDING WHEN SUCH
PACKING MATERIALS OR PACKING CONTAINERS ARE CLEARLY
SUITABLE FOR REPETITIVE USE.

Dispensing machine is considered as a container which suitable for repetitive use.
Therefore Gumballs are classified HS1704
The dispenser is classified HS7907.

EXPLANATORY NOTE for RULE 5(b)

(IV) This Rule governs the classification of packing materials and packing containers
of a kind normally used for packing the goods to which they relate. However, this
provision is not binding when such packing materials or packing containers are clearly suitable for repetitive use, for example, certain metal drums or containers of iron or
steel for compressed or liquefied gas.

(V) This Rule is subject to Rule 5 (a) and, therefore, the classification of cases, boxes
and similar containers of the kind mentioned in Rule 5 (a) shall be determined by the application of that Rule.

Rule 4 Most akin

GOODS WHICH CANNOT BE CLASSIFIED IN
ACCORDANCE WITH THE ABOVE RULES SHALL BE CLASSIFIED
UNDER THE HEADING APPROPRIATE TO THE GOODS TO WHICH
THEY ARE MOST AKIN.

If goods cannot be classified according to GRIs 1 to 3, then resort must be made to GRI
4. GRI 4 requires that goods are to “be classified under the heading appropriate to the
goods to which they are most akin.” This rule should be applied very infrequently as
GRIs 1 to 3 will cover the classification of almost all goods. When attempting to apply
this rule, however, any determination regarding “kinship” should depend on such factors
as description, character, purpose or intended use, designation, production process and
the nature of the goods.

EXAMPLE: Exhaust Air Jack (heading 84.25)

EXPLANATORY NOTE for RULE 4

(I) This Rule relates to goods which cannot be classified in accordance with Rules
1 to 3. It provides that such goods shall be classified under the heading appropriate
to the goods to which they are most akin.

(II)In classifying in accordance with Rule 4, it is necessary to compare the presented
goods  with similar goods in order to determine the goods to which the presented
goods are most akin. The presented goods are classified in the same heading as the
similar goods to which they are most akin.

(Ill) Kinship can, of course, depend on many factors, such as description, character,
purpose.

Rule 3 “two or more headings”

WHEN, BY APPLICATION OF RULE 2(b) OR FOR ANY
OTHER REASON, GOODS ARE, PRIMA FACIE, CLASSIFIABLE
UNDER TWO OR MORE HEADINGS, CLASSIFICATION SHALL BE
EFFECTED AS FOLLOWS:

GRI 3 provides for the classification of goods that are prima facie (or when initially
considered) classifiable under two or more headings. In such instances, the goods are
classified pursuant to this rule based on three criteria, taken in order:

EXPLANATORY NOTE for RULE 3

(I) This Rule provides three methods of classifying goods which, prima facie,
fall under two or more headings, either under the terms of Rule 2 (b) or for
any other reason.
These methods operate in the order in which they are set out in the Rule.
Thus Rule 3 (b) operates only if Rule 3 (a) fails in classification, and if both Rules 3 (a)
and (b) fail, Rule 3 (c) will apply. The order of priority is, therefore (a) specific description; (b) essential character; (c) heading which occurs last in numerical order.

(II) The Rule can only take effect provided the terms of headings or Section or
Chapter Notes do not otherwise require. For instance, Note 4 (B) to Chapter 97
requires that goods covered both by the description in one of the headings 97.01 to
97.05 and by the description in heading 97.06 shall be classified in one of the former headings. Such goods are to be classified according to Note 4 (B) to Chapter 97 and not according to this Rule.

Rule 3 (a) Most specific

The heading which provides the most specific description
shall be preferred to headings providing a more general
description. However, when two or more headings each refer
to part only of the materials or substances contained in mixed
or composite goods or to part only of the items in a set put up
for retail sale, those headings are to be regarded as equally
specific in relation to those goods, even if one of them gives a
more complete or precise description of the goods.

The first sentence to GRI 3 (a) provides that goods should be classified in the heading
that provides the most specific description. In general, under this criterion, (1) a
description by name is more specific than a description by class and (2) a description
that more clearly identifies a product is more specific than one which is less complete.

Example1: Chair/ladder
A wooden ladder is classified as “Other articles of wood(HS4421)”
A wooden chair is classified as “Wooden chair(HS9401)”
So where to be classified??

Retrieved from: HARMONIZED COMMODITY DESCRIPTION and CODING SYSTEM or  HARMONIZED SYSTEM(HS)

Relative Specificity
A description by name is more specific than a description by class.
A description that more clearly identifies a product is more specific than one which is less complete.

the name “Wooden chair” more clearly identifies than “Other articles of wood”
Therefore this product is classified as Wooden chair(HS9401)

Example2:
Steel spoon is classified in  HS82.15(Spoons) and not in HS73.23(Steel Household)

Example3:
Seats for motor vehicles are classified in HS94.01(Seats for motor vehicles)
and not in HS 87.08(Parts and accessories of the motor vehicles)

Example4: An example of a description by name in one heading that is
more specific than a description by class in another heading is as follow:
“shavers and hair clippers with self-contained electric motor” of heading
8510 is more specific than “electro-mechanical tools for working in the
hand with self-contained electric motor” of heading 8467 or
“electromechanical domestic appliances with self-contained electric motor” of
heading 8509.

Example5: An example of a description in one heading that more clearly
identifies a product than a description in another heading (and thus the
first description is more specific than the second description) is as follows:
A product identified as “unframed safety glass made of toughened or
laminated glass that is shaped and identifiable for use in airplanes” is
more clearly described by the article description “safety glass” of heading
7007 than by the article description “parts of goods of heading 8801 or
8802” (parts of aircraft and spacecraft) of heading 8803.

The second sentence to GRI 3 (a) further provides that when two or more headings
each refer to only one of the materials or substances in mixed or composite goods, or to
only some of the articles included in a set put up for retail sale, those headings are to be
regarded as equally specific in relation to those goods, even if one of them gives a more
complete or precise description of the goods. If this situation exists, then resort must be
made to GRI 3 (b). (See examples discussed below for GRI 3 (b).)

EXPLANATORY NOTE for RULE 3(a)

(III) The first method of classification is provided in Rule 3 (a), under which
the heading which provides the most specific description of the goods is to
be preferred to a heading which provides a more general description.

(IV) It is not practicable to lay down hard and fast rules by which to determine
whether one heading more specifically describes the goods than another,
but in general it may be said that :

(a) A description by name is more specific than a description by class
(e.g., shavers and hair clippers, with a self-contained electric motor, are
classified in heading 85.10 and not in heading 84.67 as tools for working
in the hand with self-contained electric motor or in beading 85.09 as
electro-mechanical domestic appliances with self-contained electric motor).

(b)If the goods answer to a description which more clearly identifies them,
that description is more specific than one where identification is less complete.

Examples of the latter category of goods are :

(1) Tufted textile carpets, identifiable for use in motor cars,
which are to be classified not as accessories of motor cars
in heading 87.08 but in heading 57.03, where they are more
specifically described as carpets.

(2) Unframed safety glass consisting of a toughened or laminated
glass, shaped and identifiable for use in aeroplanes, which is to be
classified not in heading 88.03 as parts of goods of heading 88.01
or 88.02 but in heading 70.07, where it is more specifically described
as safety glass.

(V) However, when two or more headings each refer to part only of the materials or
substances contained in mixed or composite goods or to part only of the items in a
set put up for retail sale, those headings are to be regarded as equally specific in
relation to those goods, even if one of them gives a more complete or precise
description than the others.
In such cases, the classification of the goods shall be determined by rule 3 (b) or 3 (c).

Rule 3 (b) Essential character

Mixtures, composite goods consisting of different
materials or made up of different components, and
goods put up in sets for retail sale, which cannot be
classified by reference to 3 (a), shall be classified as if
they consisted of the material or component which
gives them their essential character, insofar as this
criterion is applicable.

GRI 3 (b) deals with mixed goods, composite goods, and goods put up in sets for retail
sale as described above in the second sentence to GRI 3 (a) (i.e., each of the goods is
potentially classifiable in more than one heading because each good consists of two or
more different ingredients, materials, components or articles and no heading provides
for the goods as a whole).

By application of this criterion, such goods are classified according to the ingredient,
material, component or article that gives the mixtures, composite goods, or sets their
“essential character.”

Goods Put up in Sets for Retail Sale. For the purposes of GRI 3 (b), the term “goods put
up in sets for retail sale” means that the goods under consideration must (a) consist of
at least two different articles (i.e., the articles must be of a different type or nature, e.g.,
two table spoons are not such a “set”) which are, prima facie, classifiable in different
headings; (b) consist of products or articles put up together to meet a particular need or
carry out a specific activity; and (c) are put up in a manner suitable for sale directly to
users without repacking.

Example1:Mixture of barley (60%) of HS10.03 and oats (40%) of HS10.04

Retrieved from: HARMONIZED COMMODITY DESCRIPTION and CODING SYSTEM or  HARMONIZED SYSTEM(HS)

An example of a mixture of barley of HS1003(60%) and oats of HS1004(40%) in
different amounts. In such an instance, “barley” gives their essential character.
Therefore the mixture is classified as “barley(HS1003)”

Example2: An example of a “composite good”
coming within the purview of GRI 3 (b) would be a combined flashlight of
heading 8513 and radio of heading 8527 (i.e., both are contained in the
same housing). In such an instance, there is a product consisting of two
or more different units or components that are located in the same
housing with each component having a provision in which it could
potentially be classified and no provision exists in the Harmonized System
that provides for the composite good as a whole.

Example3: An example of a “set” coming within the purview of GRI 3
(b) would be a hairdressing kit consisting of a pair of electric hair clippers
of heading 8510, a comb of heading 9615, a pair of scissors of heading
8213, and a brush of heading 9603. In such an instance, there is a
product that consists of more than one item or article with each article
having a provision in which it could potentially be classified and no
provision exists in the Harmonized System that provides for the set as a
whole. In the above-mentioned hairdressing kit, the articles are put up
together to meet the particular need or carry out the specific activity of
grooming hair.

Retrieved from: HARMONIZED COMMODITY DESCRIPTION and CODING SYSTEM or  HARMONIZED SYSTEM(HS)

Example4:  A mixture for brewing, consisting of 70 % wheat and 30 % barley. The mixture is
classified in Heading 10.01 (Wheat and meslin).

Example5: Liquor-filled chocolates are classified in Heading 18.06 (Chocolate and other food
preparations containing cocoa).

Example6: A bed linen set comprising a woven bedspread, pillow-cases and bolsters put up in a
paperboard case. It is classified in Heading 63.04.

EXPLANATORY NOTE for RULE 3(b)

(VI) This second method relates only to :

(i) Mixtures.
(ii) Composite goods consisting of different materials.
(iii) Composite goods consisting of different components.
(iv) Goods put up in sets for retail sales.
It applies only if Rule 3 (a) fails.

(VII) In all these cases the goods are to be classified as if they consisted of the
material or component which gives them their essential character, insofar as
this criterion is applicable.

(VIII) The factor which determines essential character will vary as between
different kinds of goods. It may, for example, be determined by the nature of
the material or component, its bulk, quantity, weight or value, or by the role
of a constituent material in relation to the use of the goods.

(IX)For the purposes of this Rule, composite goods made up of different components
shall be taken to mean not only those in which the components are attached to
each other to form a practically inseparable whole but also those with separable components, provided these components are adapted one to the other and are
mutually complementary and that together they form a whole which would not
normally be offered for sale in separate parts.
Examples of the latter category of goods are :

(1) Ashtrays consisting of a stand incorporating a removable ash bowl.
(2) Household spice racks consisting of a specially designed frame
(usually of wood) and an appropriate number of empty spice jars of
suitable shape and size.

As a general rule, the components of these composite goods are put
up in a common packing.

(X) For the purposes of this Rule, the term “goods put up in sets for retail sale”
shall be taken to mean goods which :

(a) consist of at least two different articles which are, prima facie, classifiable
in different headings. Therefore, for example, six fondue forks cannot be
regarded as a set within the meaning of this Rule;

(b) consist of products or articles put up together to meet a particular need or
carry out a specific activity; and

(c) are put up in a manner suitable for sale directly to users without repacking
(e.g., in boxes or cases or on boards). The term therefore covers sets consisting,
for example, of different foodstuffs intended to be used together in the
preparation of a ready-to-eat dish or meal. Examples of sets which can be
classified by reference to Rule 3 (b) are :

(1)
(a) Sets consisting of a sandwich made of beef, with or without cheese,
in a bun (heading 16.02), packaged with potato chips (French fries)
(heading 20.04) : Classification in heading 16.02.
(b)Sets, the components of which are intended to be used together in the
(reparation of a spaghetti meal, consisting of a packet of uncooked
spaghetti heading 19.02), a sachet of grated cheese (heading 04.06) and
a small tin of tomato sauce (heading 21.03), put up in a carton :
Classification in heading 19.02.

The Rule does not, however, cover selections of products put up together
and consisting, for example, of:

a can of shrimps (heading 16.05), a can of pâté de foie (heading 16.02),
a can of cheese (heading 04.06), a can of sliced bacon (heading 16.02),
and a can of cocktail sausages (heading 16.01); or

a bottle of spirits of heading 22.08 and a bottle of wine of heading 22.04.

In the case of these two examples and similar selections of products,
each item is to be classified separately in its own appropriate heading.

(2) Hairdressing sets consisting of a pair of electric hair clippers (heading 85.10),
a comb (heading 96.15), a pair of scissors (heading 82.13), a brush
(heading 96.03) and a towel of textile material (heading 63.02), put up in a leather
case (heading 42.02) : Classification in heading 85.10.

(3)Drawing kits comprising a ruler (heading 90.17), a disc calculator
(heading 90.17), a drawing compass (heading 90.17), a pencil (heading
96.09) and a pencil-sharpener (heading 82.14), put up m a case of
plastic sheeting (heading 42.02):

Classification in heading 90.17.

For the sets mentioned above, the classification is made according to the
component, or components taken together, which can be regarded as
conferring on the set as a whole its essential character.

(XI)This Rule does not apply to goods consisting of separately packed constituents
put up together, whether or not in a common packing, in fixed proportions for the
industrial manufacture of, for example, beverages.

 

Rule 3 (c) Last in numerical order

WHEN GOODS CANNOT BE CLASSIFIED BY REFERENCE TO
3(a) OR 3(b), THEY SHALL BE CLASSIFIED UNDER THE HEADING
WHICH OCCURS LAST IN NUMERICAL ORDER AMONG THOSE
WHICH EQUALLY MERIT CONSIDERATION.

GRI 3 (c) states that goods should be classified under the heading that occurs last in
numerical order from among those that equally merit consideration if the goods cannot
be classified by reference to GRIs 3 (a) or 3 (b).

EXAMPLE1:

In the above-mentioned example of the mixed good consisting of barley
and oats in equal amounts, if neither the barley nor the oats is found to
impart the essential character to the product, then by application of GRI 3
(c) the product would be classified in heading 1004 as if consisting solely
of the oats. This is because the heading number for the oats found in the
mixture occurs last in numerical order as between it and the barley (i.e.,
1003 for the barley and 1004 for the oats).

EXAMPLE2: A belt made of 50 % leather(heading42.03) and
50 % textiles(heading62.17) is classified in Heading 62.17.

EXAMPLE3: A machine-tool for working stone(heading 84.64) as well as
wood(heading 84.65) is classified in Heading 84.65.

EXAMPLE4: Electric lamp (heading 94.05) with an alarm clock (heading 91.05)
is classified in 94.05.

EXAMPLE5: Chandeliers (heading 94.05) with electric fan (heading 84.14)
is classified in 94.05.

 

WHAT IS THE ESSENTIAL CHARACTER OF A PRODUCT?
The term “essential character,” as used in the GRIs, is not defined in the Harmonized
System. As concerns that term, however, it is stated in the Explanatory Notes to the
Harmonized System (which is an extrinsic interpretative aid to the Harmonized System
that is discussed below) that the factor that determines the essential character of a good
will vary as between different kinds of goods (i.e., essential character must be
determined on a case-by-case basis). The essential character of a good, may, for
example, be determined by the nature of the material or component, its bulk, quality,
weight or value, or by the role of a constituent material in relation to the use of the
goods. Other factors may be considered in determining the essential character of a
product.

EXPLANATORY NOTE for RULE 3(c)

(XII) When goods cannot be classified by reference to Rule 3 (a) or 3 (b), they are to be classified in the heading which occurs last in numerical order among those which
equally merit consideration in determining their classification.

Rule 2 (a) Incomplete or unfinished; Unassembled or disassembled

RULE 2. (a) ANY REFERENCE IN A HEADING TO AN ARTICLE
SHALL BE TAKEN TO INCLUDE A REFERENCE TO THAT ARTICLE
INCOMPLETE OR UNFINISHED, PROVIDED THAT, AS ENTERED,
THE INCOMPLETE OR UNFINISHED ARTICLE HAS THE ESSENTIAL
CHARACTER OF THE COMPLETE OR FINISHED ARTICLE. IT SHALL
ALSO INCLUDE A REFERENCE TO THAT ARTICLE COMPLETE OR
FINISHED (OR FALLING TO BE CLASSIFIED AS COMPLETE OR
FINISHED BY VIRTUE OF THIS RULE), ENTERED UNASSEMBLED OR
DISASSEMBLED.

GRI 2 (a) has two parts. Part one deals with incomplete or unfinished goods and part
two deals with unassembled or disassembled goods.

 

Part One incomplete or unfinished goods

The first part of GRI 2 (a) extends the scope of any heading that refers to a
particular article to cover not only the complete article but also that article incomplete or
unfinished, provided that, as presented, it has the “essential character” (which is
discussed below) of the complete or finished article.

EXAMPLE1: A ceramic statuette of the Hokie Bird that will be painted after
importation would still generally have the essential character of a ceramic
statuette of heading 6913 (i.e., one would still recognize and identify the
product as a ceramic statuette) and would, therefore, be classified pursuant
to GRI 2 (a) as the finished product in heading 6913.

Example2: Preform bottle – Unfinished (heading 39.23 covers plastic bottles)

Retrieved from: HARMONIZED COMMODITY DESCRIPTION and CODING SYSTEM or  HARMONIZED SYSTEM(HS)

Example3: Wrist watch without strap – Incomplete (heading 91.02 covers wristwatches)

Retrieved from: HARMONIZED COMMODITY DESCRIPTION and CODING SYSTEM or  HARMONIZED SYSTEM(HS)

Part Two unassembled or disassembled goods

The second part of GRI 2 (a) provides that complete or finished articles presented
unassembled or disassembled (which may occur for reasons related to the packing,
handling or transportation of the articles) are to be classified in the same heading as the
assembled article. It also provides incomplete or unfinished articles presented
unassembled or disassembled are to be classified in the same heading as the complete
or finished article provided that as presented they have the essential character of the
complete or finished article (as provided for in the first part of GRI 2 (a)).

EXAMPLE1: A shipment of an unassembled bicycle (containing all parts
and components necessary to build a bicycle) would be classified in
heading 8712 as an assembled, finished bicycle as if it were entered (or
imported) as the assembled, finished bicycle.

Example2: A complete set of wooden panels meant for assembly into a cupboard,
is considered as a finished cupboard.

EXAMPLE3: Unassembled office chair (heading 94.01 covers seats)

EXPLANATORY NOTE for RULE 2 (a)

(Incomplete or unfinished articles)

(I)The first part of Rule 2 (a) extends the scope of any heading which refers to a particular
article to cover not only the complete article but also that article incomplete or
unfinished, provided that, as presented, it has the essential character of the complete or
finished article.

(II) The provisions of this Rule also apply to blanks unless these are specified in a particular
heading. The term “blank” means an article, not ready for direct use, having the
approximate shape or outline of the finished article or part, and which can only be used,
other than in exceptional cases, for completion into the finished article or part (e.g., bottle preforms of plastics being intermediate products having tubular shape, with one closed end and one open end threaded to secure a screw type closure, the portion below
the threaded end being intended to be expanded to a desired size and shape).

Semi-manufactures not yet having the essential shape of the finished articles (such as is
generally the case with bars, discs, tubes, etc.) are not regarded as “blanks”.

(III) In view of the scope of the headings of Sections I to VI, this part of the Rules does not
normally apply to goods of these Sections.

(IV) Several cases covered by the Rule are cited in the General Explanatory Notes to Sections
or Chapters (e.g., Section XVI, and Chapters 61,62, 86, 87 and 90).

(Articles presented unassembled or disassembled)

(V) The second part of Rule 2 (a) provides that complete or finished articles presented
unassembled or disassembled are to be classified in the same heading as the assembled
article. When goods are so presented, it is usually for reasons such as requirements or
convenience of packing, handling or transport.

(VI) This Rule also applies to incomplete or unfinished articles presented unassembled or
disassembled provided that they are to be treated as complete or finished articles by virtue of the first part of this Rule.

(VII) For the purposes of this Rule, “articles resented unassembled or disassembled” means
articles the components of which are to be assembled either by means of fixing devices (screws, nuts, bolts, etc.) or by riveting or welding, for example, provided only assembly operations are involved.

No account is to be taken in that regard of the complexity of the assembly method.
However, the components shall not be subjected to any further working operation for completion into the finished state.

Unassembled components of an article which are in excess of the number required for
that article when complete are to be classified separately.

(VIII) Cases covered by this Rule are cited in the General Explanatory Notes to Sections or
Chapters (e.g., Section XVI, and Chapters 44, 86,87 and 89).

(IX) In view of the scope of the headings of Sections I to VI, this part of the Rule does not
normally apply to goods of these Sections.

Rule 2 (b) Mixtures or combinations

RULE 2.(b) ANY REFERENCE IN A HEADING TO A MATERIAL
OR SUBSTANCE SHALL BE TAKEN TO INCLUDE A REFERENCE TO
MIXTURES OR COMBINATIONS OF THAT MATERIAL OR
SUBSTANCE WITH OTHER MATERIALS OR SUBSTANCES. ANY
REFERENCE TO GOODS OF A GIVEN MATERIAL OR SUBSTANCE
SHALL BE TAKEN TO INCLUDE A REFERENCE TO GOODS
CONSISTING WHOLLY OR PARTLY OF SUCH MATERIAL OR
SUBSTANCE. THE CLASSIFICATION OF GOODS CONSISTING OF
MORE THAN ONE MATERIAL OR SUBSTANCE SHALL BE
ACCORDING TO THE PRINCIPLES OF RULE 3.

GRI 2 (b) governs the classification (1) of mixtures and combinations of materials or
substances and (2) of goods consisting of two or more materials or substances. The
rule extends headings referring (1) to a material or substance to include mixtures or
combinations of that material or substance with other materials or substances and (2) to
goods of a given material or substance to include goods consisting wholly or partly of
that material or substance (but only as long as another heading does not refer to the
goods in their mixed or composite state).

If the addition of another material or substance deprives the imported good of the
character of the kind mentioned in the heading under consideration, however, then
one must resort to GRI 3 for classification of the merchandise. Or, in other words,
mixtures and combinations of materials or substances, and goods consisting of
more than one material or substance, if upon initial consideration are potentially
classifiable under two or more headings, they must be classified according to the
principles of GRI 3.

EXAMPLE1: Under GRI 2 (b), a stainless steel travel mug with a plastic
handle would be classifiable in heading 7323 as a table, kitchen or other
household article of steel despite the plastic handle (as it retains the
character of a table, kitchen or another household article of steel as
mentioned in heading 7323). If a travel mug, however, contained
relatively equal amounts of stainless steel and plastic (e.g., the outside or
outer surface of the mug is made of plastic and the inside or inner surface
(lining) of the mug is made of stainless steel), then the travel mug would
be potentially classifiable under two headings: heading 3924 as tableware,
kitchenware or other household article of plastic and heading 7323 as a
table, kitchen or other household article of steel. (Or, contrasting this
product with the initial one considered in this example, a travel mug
consisting of relatively equal amounts of stainless steel and plastic does
not have the character of a table, kitchen or other household article of
steel as mentioned in heading 7323.) In this situation, pursuant to GRI 2(b),
resort would need to be made to GRI 3 for classification of the product.

EXAMPLE2: Milk to which vitamins or minerals have been added.

EXAMPLE3: A pack of cornflakes which also contains a small amount of nuts and raisins.

EXPLANATORY NOTE for RULE 2 (b)

(Mixtures and combinations of materials or substances)
(X) Rule 2 (b) concerns mixtures and combinations of materials or substances, and goods consisting of two or more materials or substances. The headings to which it refers are
headings in which there is a reference to a material or substance (e.g.,- heading 05.07 – ivory), and headings in which there is a reference to goods of a given material or
substance (e.g., heading 45.03 – articles of natural cork). It will be noted that the Rule
applies only if the headings or the Section or Chapter Notes do not otherwise require
(e.g., heading 15.03 – lard oil, not … mixed).

Mixtures being preparations described as such in a Section or Chapter Note or in a
heading text are to be classified under the provisions of Rule 1.

(XI) The effect of the Rule is to extend any heading referring to a material or substance to
include mixtures or combinations of d at material or substance with other materials or
substances. The effect of the Rule is also to extend any heading referring to goods of a
given material or substance to include goods consisting partly of that material or
substance.

(XII) It does not, however, widen the heading so as to cover goods which cannot be regarded,
as required under Rule 1, as answering the description in the heading; this occurs where
the addition of another material or substance deprives the goods of the character of goods
of the kind mentioned in the heading.

(XIII) As a consequence of this Rule, mixtures, and combinations of materials or substances,
and goods consisting of more than one material or substance, if prima facie classifiable
under two or more headings,  must, therefore be classified according to the principles of
Rule 3.

GRI Rule 1 Terms of the Headings, Section/Chapter Notes

THE TABLE OF CONTENTS, ALPHABETICAL INDEX, AND
TITLES OF SECTIONS, CHAPTERS AND SUB-CHAPTERS ARE
PROVIDED FOR EASE OF REFERENCE ONLY; FOR LEGAL
PURPOSES, CLASSIFICATION SHALL BE DETERMINED
ACCORDING TO THE TERMS OF THE HEADINGS AND ANY
RELATIVE SECTION OR CHAPTER NOTES AND, PROVIDED SUCH
HEADINGS OR NOTES DO NOT OTHERWISE REQUIRE, ACCORDING
TO THE FOLLOWING PROVISIONS: [that is, GRIs 2 to 6].

EXAMPLE 1: Under GRI 1, if a provision specifically and completely
describes a product, then the product would be classified in that provision
(e.g., fresh grapes are classified under heading 0806 which provides for
“grapes, fresh or dried”). In this situation, the product is classified by the
terms of a heading.

Example: Live poultry (heading 01.05)

Retrieved from: HARMONIZED COMMODITY DESCRIPTION and CODING SYSTEM or  HARMONIZED SYSTEM(HS)

EXAMPLE 2: Note 3 to Section XVI to the Harmonized System directs
classification of composite machines described therein on the basis of the
“principal function” of the machines. Under GRI 1, such machines are to
be classified as so directed in that note. In this situation, the products are
classified by the terms of a section note.

Example of Terms of the Headings, Section/Chapter Notes

EXAMPLE 3: Section XV is entitled “Base metals and articles of base metal”
but jewelry of base metal is classified in Section XIV.

EXAMPLE 4: Chapter 61 is entitled “Articles of apparel and clothing accessories,
knitted or crocheted”, although the chapter also covers certain articles which are
not wholly knitted or crocheted, such as those in heading 62.12.

EXAMPLE 5: Live horses are classified in Heading 01.01.

 

GRI 1 further states that if the texts of the headings and of the notes cannot, by
themselves, determine the appropriate heading for classification of merchandise, then
classification is to be determined by the appropriate GRIs that follow GRI 1 (i.e., GRIs 2
to 6).

EXPLANATORY NOTE

(I) The Nomenclature sets out in systematic form the goods handled in international trade. It
groups these goods in Sections, Chapters, and sub-chapters which have been given titles indicating as concisely as possible the categories or types of goods they cover. In many cases, however, the variety and number of goods classified in a Section or Chapter are
such that it is impossible to cover them all or to cite them specifically in the titles.

(II) Rule 1 begins therefore by establishing that the titles are provided “for ease of reference
only”. They accordingly have no legal bearing on classification.

(III) The second part of this Rule provides that classification shall be determined :

(a) according to the terms of the headings and any relative Section or
Chapter Notes, and

(b) where appropriate, provided the headings or Notes do not otherwise
require, according to the provisions of Rules 2,3,4, and 5.

(IV) Provision (III) (a) is self-evident, and many goods are classified in the Nomenclature
without recourse to any further consideration of the Interpretative Rules (e.g., live horses
01.01), pharmaceutical goods specified in Note 4 to Chapter30 (heading 30.06).

(V) In provision (III) (b) :

(a) The expression “provided such headings or Notes do not otherwise require” is
intended to make it quite clear that the tern of the headings and any relative
Section or Chapter Notes are paramount, i.e., they are the first consideration in
determining classification. For example, in Chapter 31, the Notes provide that
certain headings relate only to particular goods. Consequently those headings
cannot be extended to include goods which otherwise might fall there by reason of
the operation of Rule 2 (b).

(b) The reference to Rule 2 in the expression “according to the provisions of Rules 2,3, 4 and 5” means that :

(1) goods presented incomplete or unfinished (e.g., a bicycle without saddle and
tyres), and

(2) goods presented unassembled or disassembled e.g., a bicycle, unassembled or
disassembled, all components bein presented together) whose components could individually be classified in their, own right (c.g., tyres, inner tubes) or as “parts” of those goods,

are to be classified as if they were those goods in a complete or finished state,
provided the terms of Rule 2 (a) are satisfied and the headings or Notes do not
otherwise require.