CBSA Reasoning
&&Section 10 of the Customs Tariff directs that classification of imported goods shall be determined in accordance with the General Rules for the Interpretation of the Harmonized System and the Canadian Rules set out in the schedule. Section 11 of the Customs Tariff states that in interpreting the headings and subheadings, regard shall be had to the World Customs Organization's (WCO) Compendium of Classification Opinions and Explanatory Notes to the Harmonized Commodity Description and Coding System (HS).&&&&General Interpretative Rule 1 (GIR 1) directs that 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. Similarly, General Interpretative Rule 6 (GIR 6) directs that classification shall be determined according to the terms of those subheadings and any related Subheading Notes.&&&&In your application for an advance ruling, you suggested tariff classification number 9505.10.00.90. This tariff classification number is correct.&&&&Heading 95.05 accounts for "Festive, carnival or other entertainment articles, including conjuring tricks and novelty jokes."&&&&Explanatory Notes (A) (2) to heading 95.05 specifies that it includes "Articles traditionally used at Christmas festivities, e.g., artificial Christmas trees, nativity scenes, nativity figures and animals, angels, Christmas crackers, Christmas stockings, imitation yule logs, Father Christmases." While penguins can hardly be seen as animals associated with Christmas, the Santa Claus hat and holly berries are strong Christmas symbols. Accordingly, the product can be seen as an article traditionally used at Christmas festivities.&&&&The Explanatory Notes to heading 95.05 also states that the heading covers "Festive, carnival or other entertainment articles, which in view of their intended use are generally made of non-durable material.", but in appeal AP-2018-053, the Tribunal indicated that it has previously found that non-durability is not a prerequisite for classification within heading 95.05.&&&&Nonetheless, articles that contain a festive design, decoration, emblem or motif and have a utilitarian function, are to be excluded from heading 95.05. Therefore, even though it has been determined that the items are, by their features, associated with the Christmas festivities, it remained to be determined if they have a utilitarian function.&&&&In AP-2018-053, the Tribunal determined that, to be deemed having a utilitarian function, "the predominant purpose of the goods" must be to illuminate, which it concluded is a utilitarian function. In the case at hand, the product's predominant purpose is instead to be a Christmas decoration, with a secondary enlightenment feature.&&&&The product is first and foremost a reusable, Christmas decoration. The fact that it can enlighten itself only allows the product to fulfill its function of Christmas decoration at night/in the dark, and not to fulfill the function of illuminating a place.&&&&In AP-2018-053, the Tribunal also determined that, in regards to whether the goods have a "utilitarian function, articles not specifically holiday-related and which may be used year round should be classified in their specific heading and not under heading 95.05." The product of this AR request could arguably be used all winter, but definitely not all year round, and by its clear Christmas symbols, it could reasonably be admitted that it is to be used solely or mainly during the Christmas holidays.&&&&For all of the above, and as the predominant purpose of the good is not to provide illumination but instead to be a Christmas decoration, the 4 feet Pop-up Penguin, Item X77319, is excluded from heading 94.05 and classified under heading 95.05, and more specifically under 9505.10.00.90, article for Christmas festivities, other, by way of GIR 1, 2(a) and 6.
