Key Facts
- •Star-Images Enterprises Ltd. appealed HMRC's decisions on customs duty and import tax classifications of imported toy figures.
- •Two C18 Post Clearance Demand Notices and a BTI decision were involved.
- •The dispute centered on the classification of 60 items under HS Code 9503 (Toys) and 3926 (Statuettes).
- •HMRC classified items as 'Dolls,' 'Sets,' 'Other toys,' or 'Statuettes,' while the Appellant argued for 'Non-human toys' classification.
- •The Appellant's classification relied on the fictional 'backstory' of the characters, while HMRC focused on the physical characteristics.
Legal Principles
The decisive criterion for classification is the goods' objective characteristics and properties as defined in the CN and its notes.
Barrus & Kubota v Revenue and Customs [2013] UKUT 0449 (TCC)
GIRs provide rules for interpretation of the CN to ensure correct classification and have the force of law.
Build-A-Bear Workshop UK Holdings Ltd v HMRC [2022] EWCA Civ 825
HSENs and CNENs are important interpretative aids but not legally binding and cannot alter the meaning of CN provisions.
Revenue and Customs Commissioners v Honeywell Analytics Limited [2018] EWCA Civ 579; Invamed Group Limited and ors v HMRC [2020] EWCA Civ 243
Note 3 to Chapter 95 applies to parts and accessories suitable for use solely or principally with articles of Chapter 95.
Chapter 95, Note 3
Classification must proceed hierarchically, comparing headings and subheadings at the same level.
Build-A-Bear Workshop UK Holdings Ltd v HMRC [2022] EWCA Civ 825
Outcomes
Appeal allowed in part, refused in part.
The Tribunal considered the objective characteristics and properties of each item, rejecting the Appellant's reliance on character 'backstories.' Classifications varied based on whether items were Dolls (with or without moveable parts), Sets (containing multiple items with independent play value), Other toys, or Statuettes (ornamental value outweighing recreational value).