Bundles, kits and sets

The criteria come from the WCO's Explanatory Notes, which CBP quotes and applies in ruling H061205. All three must be met:

1. The bundle has at least two different goods that fall in different headings. Six identical mugs aren't a set for this purpose, and neither are items that all fall in the same heading.
2. The goods are put up together to meet a particular need or carry out a specific activity. In H061205, a tumbler and a tea infuser passed because they were put up to make and drink tea. A random selection of gifts is unlikely to pass.
3. They're packed for sale directly to users without repacking. In H061205 a small retail box was enough. Goods packed in bulk for a retailer to split would fail this.

If it passes, the whole set takes the code of the component that gives its essential character. If no component does, Rule 3(c) sends you to the last heading in numerical order among the candidates.

This is our own illustration, and the rates are invented. An importer brings in 500 coffee starter packs, each with a ceramic mug, 250 g of ground coffee and a steel spoon.

If it passes the test, and coffee gives the essential character, the whole 8,000 goes in at the coffee rate of 0%, for duty of 0.00. If the mug gave the character, the whole 8,000 goes in at 10%, for duty of 800.00. So depending on the outcome, the same shipment costs nothing, 350, or 800.

That spread is why you should work it out before you agree the pack design, and why you shouldn't assume the answer that suits you. CBP's tea infuser and tumbler ruling shows the type of analysis: bulk, quantity and weight didn't help, so the infuser decided it, at 70% of the cost and with the main role in brewing, and the set went to heading 7323. A product that merges several materials into one article is a composite good rather than a set, as with the key rings with charms in N314144, where the ring's function decided it. If real money turns on it, ask for a binding decision.

A kit of parts that makes one finished article isn't a Rule 3 question. Rule 2(a) says a heading for an article includes it unassembled or disassembled. A bookcase in a flat pack is classified as a bookcase, not as boards and screws. The same holds for an incomplete article with the essential character of the finished one, such as a bicycle without a saddle.

If a kit is split across shipments, check with your broker before assuming each delivery stands on its own.

Rule 5(a) puts specially fitted, long-term cases in with the article they hold, such as a camera case, when normally sold with it. The exception is where the case gives the whole its essential character. Rule 5(b) does the same for normal packing, unless the packing is clearly suitable for repeated use.

If it fails the test, list each component on the commercial invoice with its own description, code, origin and value. You'll need to split the price in a defensible way, normally on what each item would sell for or costs you. A single price for the bundle with no breakdown invites customs to choose for you.

Two further points:

• Origin is a separate question. A set classified under one code can still contain goods of several origins. Marking and any US additional duties may turn on each item's origin.
• EU low-value parcels count lines. The temporary EUR 3 duty is charged per declaration line, so whether you've got one code or three changes the charge. The Commission's guidance says goods can't be grouped under one code using the highest-rate simplification where this duty applies.

Ecommerce bundles created at checkout are the hardest case: the customer picks, nothing's packed as a set until the order is packed, and it's sold as separate items. As practical advice, we'd assume those don't meet the third test and declare them line by line, unless your broker or a ruling says otherwise.