Background

A recent classification ruling revocation has more than doubled the duty rate on certain sneakers that have embroidery on their uppers. Importers of footwear that had been classified as non-athletic and subject to lower rates of duty because the uppers incorporated embroidery or sequins should reevaluate those classifications based on this revocation.

In the Jan. 26, 2022, Customs Bulletin and Decisions, U.S. Customs and Border Protection is reclassifying certain girls’ and women’s closed-toe, closed-heel, below-the-ankle shoes as athletic footwear under HTSUS 6404.11.90 (20 percent duty) rather than as non-athletic footwear under HTSUS 6404.19.90 (9 percent duty). Ruling HQ H302976 will revoke rulings NY N285583 and NY N299433 to reflect this change, effective with respect to subject goods entered or withdrawn from warehouse for consumption on or after March 27.

This reclassification changes CBP’s longstanding treatment of textile upper footwear that has been classified as non-athletic because the uppers are embroidered or decorated with sequins. After considering comments submitted by interested parties, CBP said that the mere addition of embroidery to an upper does not necessarily render the footwear unsuitable for athletic use, whether or not the footwear is actually used for athletic purposes. CBP said this position does not conflict with previously published guidelines that specifically mentioned embroidery as a feature uncharacteristic of athletic footwear.

The issue of whether footwear is “athletic,” “athleisure,” or “fashion” for classification purposes is often contentious. CBP’s revocation makes clear, however, that embroidery alone will not likely preclude the higher “athletic” footwear duty rate. It does leave the door open for loosely attached sequins and decorations that could fall off and create a danger for athletic use but casts doubt on whether firmly-attached sequins would rule out “athletic” classification.

For more information, please contact attorney William Maloney at (212) 549-0149 or via email.

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