May 21, 2004
Pursuant to a ruling request filed by our law firm, U.S. Customs and Border Protection (CBP) issued a ruling on September 5, 2002 (HQ 963224), revising the method by which CBP determines whether a shoe contains an "open heel". In essence, Customs abandoned the ¾ inch rule and indicated that each shoe would be decided on a case-by-base basis. CBP will look to see whether any part of the heel of the wearer is partially visible.
In the ruling in issue, CBP held that certain plastic molded clogs did not fall within the definition of "waterproof footwear". In essence, CBP agreed with the position of the U.S. importer that the clogs were dutiable at the 2.4% duty rate, instead of at the 25% duty rate.
The merchandise involved in the ruling consisted of slip-on, below the ankle, injection-molded, polyurethane plastic clogs. At the time of importation, the clogs did not contain any insoles. Rather, the insoles were inserted after importation and sold with the clogs in the U.S. CBP indicated that, without the insole in place, the heel ridge surrounds and covers a portion of the wearer's heel to a level that is at least ¾ of an inch vertically above the rearmost, horizontal portion of the clog's interior foot bed. However, Customs admitted that the heel of the wearer would always be at least partially visible , whether or not the insoles were used.
The molded shoes were classified by the Port of Portland under subheading 6401.99.30 as waterproof footwear, designed to be worn over, or in lieu of, other footwear as a protection against water, etc., at 25%. CBP agreed with the position of the importer that the clogs were properly classifiable under subheading 6401.99.8000 as waterproof footwear, other, having uppers over which 90% of the external area is rubber or plastics at the duty rate of 2.4% ad valorem (2004 rate is free of duty). In arriving at this conclusion, CBP referred to the "Footwear Definitions" in Treasury Decision (T.D.) 93-88. CBP also admitted that, in general, open toe/open heel footwear is not designed to be worn over or in lieu of other footwear as a protection against water, etc.
CBP indicated that in open heeled shoes, all or part of the back of the wearer's heel can be seen. For determining classification under footwear principles, CBP stated the following:
For footwear classification purposes, Customs interprets the "heel" to be the rearmost boney part of the human foot, the top of which is located just below the Achilles tendon.
As previously noted, examination of the sample clog revealed a raised ridge at the heel. Although the heel ridge distinguishes the subject clog from those of a lower, or no heel ridge, the heel of one using the subject clog would always be at least partially visible. In this regard the "Anywear Clog" is "open heeled" footwear.
In essence, CBP concluded that the clogs constitute "open heeled" footwear and were not designed as a protection against water.
Prior to this ruling, it had been CBP's position that if the measurement from the top of the uncompressed insole to the top of the heel ridge is ¾ of an inch or more, the shoe would be considered "closed heeled". However, a measurement of less than ¾ of an inch would render the shoe "open-heeled". This ruling basically does away with the ¾ inch guideline. Instead, whether a shoe is open-heeled will be judged on a case-by-case basis.
Importers of footwear should also be aware of the fact that the presence of an open heel can change the classification of athletic and running shoes, particularly if the upper is of textile material. In recent years, some running shoes have been produced with a slip-on construction, and would be considered open-heeled. The issue for this type of footwear is not whether it is open-heeled, but whether it is "athletic" or "non-athletic" for tariff classification purposes. Non-athletic footwear with uppers of textile would take a lower duty rate.
If you have any questions on any of the issues raised in this newsletter, please contact Steve Spraitzar at (415) 288-0427 or via email at firstname.lastname@example.org, or George R. Tuttle at (415) 288-0425 or via email at email@example.com.
Stephen Spraitzar is an attorney with the Law Offices of George R. Tuttle in San Francisco. The information in this article is general in nature, and is not intended to constitute legal advice or to create an attorney-client relationship with respect to any event or occurrence, and may not be considered as such.
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