CIT Rejects CBP's Classification for Flexible Packaging Material Formpack
A flexible packaging material imported by Amcor Flexibles Kreuzlingen is classifiable as "other" backed aluminum foil, rather than aluminum foil decorated with a pattern or design, the Court of International Trade said in a Feb. 22 decision. Judge Gary Katzmann said that since the text on the foil is communicative text and not a pattern, Amcor's suggested alternative Harmonized Tariff Schedule subheading was the proper one, though he rejected the HTS heading most preferred by Amcor.
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The product at issue, Formpack, is a "thin, soft-tempered aluminum foil with a heat-sealable coating on one side and plastic film lamination featuring product, brand, weight and usage instructions on the reverse." Amcor's Formpack imports were liquidated by CBP under Harmonized Tariff Schedule subheading 7607.20.10, as backed aluminum foil "overed or decorated with a character, design, fancy effect or pattern," dutiable at 3.7%. Following a denied protest, Amcor filed suit at the trade court to argue that the foil actually belongs under heading 4911 as "other printed matter" or, failing that, in subheading 7607.20.50 as "other" backed foil. Both of those provisions are duty free.
Katzmann said that heading 7607 is the proper home for the Formpack entries, rather than 4911. Amcor argued that the printing on the foil transforms the product from backed foil to other printed matter. The judge responded that the printing on the Formpack neither defines its essential nature and use, nor excludes it from classification as foil under heading 7607. Katzmann said that the explanatory notes for 7607 said that "the heading does not cover 'printed aluminum foil labels being identifiable individual articles by virtue of the printing.'" And while the Formpacks are printed and made of aluminum foil, they are not affixed to the items they identify or describe. Since they're not labels, they don't belong under heading 4911, the judge said.
The judge was more favorable to the importer on the question of the subheading within heading 7607. "Plaintiff and its expert witness argue persuasively that in light of 7607.20.10’s language and the relevant chapter and heading notes, the subheading is meant to include only printing that is decorative in nature, and not communicative text," the judge said.
Katzmann rejected CBP's position that the printing on the Formpack represents a repeating design or pattern that covers or decorates the goods. "Any printed material must be designed before it is printed; however, having been designed is not the same as being 'a design,' as contemplated by the subheading," the opinion said.
(Amcor Flexibles Kreuzlingen AG v. United States, Slip Op. 22-15, CIT #16-00193, dated 02/22/22, Judge Gary Katzmann. Attorneys: Wm. Randolph Rucker of Faegre Drinker for plaintiff Amcor Flexibles Kreuzlingen; Edward Kenny for defendant U.S. government)