Importer Says Plastic Lips With Lollipop Part Are Toys, Not Candy
CBP improperly classified certain toy lips as candy under Harmonized Tariff Schedule Chapter 17 instead of "other toys" under Chapter 95, said importer Imaginings, doing business as Flix Candy, in a complaint last week at the Court of International Trade. Flix said that while the lips consist of two components, the plastic lips and a candy lollipop, the lips give the item its "essential character" and thus qualify the goods for Chapter 95 classification (Imaginings 3, d/b/a Flix Candy v. United States, CIT # 21-00403).
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The items at issue are Lip Pops, which are a "composite product consisting of a plastic set of false lips often imitating those of a well-known character, connected to a plastic stem with a piece of hard candy (lollipop) at the end." Flix said the plastic lips cost about 10 times as much to make as the lollipop. The company also noted that it pays royalties to licensors "for the right to incorporate trademarked designs in the plastic lips."
CBP liquidated the Lip Pops under HTS subheading 1704.90.3550, which provides for other sugar confectionery items not containing cocoa put up for retail sale. The subheading carries a 5.6% duty and comes with a 25% Section 301 duty under secondary subheading 9903.88.03.
If the plastic lips and lollipops were imported separately, they would fall under different subheadings, Flix said: The plastic lips would fall under subheading 9503.00.0073 as "other toys," while the lollipops would fall under subheading 1704.90.3550. Under General Rule of Interpretation 3(b), goods put up for retail sale "shall be classified as if they consisted of the material or component which gives them their essential character," the importer noted.
The complaint argued that the plastic lips, and not the lollipops, give the items their essential character, because the toy lips are the "most costly" piece, account for the "greatest weight of the set components" and are the "most important component for the functioning of the set." The Lip Pops "are primarily sold and used for the amusement of children and adults, and their use as a pleasurable diversion exceeds any practical or utilitarian use."
The design of the toy lips also drives the product's marketing, while the lollipop element "does not drive the packaging or marketing of the 'Lip Pops' product," the complaint said.
Flix argued that the Lip Pops are properly classified under duty-free subheading 9503.00.0073 and thus can't be classified under secondary subheading 9903.88.03, which is tied to goods under Chapter 17.
Alternatively, the importer said the goods should be classified under subheading 9505.90.2000, which provides for "[f]estive, carnival or other entertainment articles, including magic tricks and practical joke articles." The goods fit under this subheading, since the essential character of the items, the plastic lips, are "entertainment articles that can be used as practical joke articles," the brief said.