https://new.kenyalaw.org/akn/ke/judgment/ketat/2026/251

 REPUBLIC OF KENYA IN THE TRIBUNAL OF KENYA AT NAIROBI COUNTY COURT NAME: TAX APPEALS TRIBUNAL CASE NUMBER: TATC/E921/2025 SILAFRICA KENYA LIMITED VS COMMISSIONER OF CUSTOMS AND BORDER CONTROL JUDGMENT # BACKGROUND 1. The Appellant is a private limited liability company duly incorporated in Kenya under the Companies Act, whose principal activity is the manufacture of high-quality rigid and flexible packaging products across East and Central Africa, serving FMCG companies and other businesses 2. The Respondent is a principal officer appointed under Section 13 of the Kenya Revenue Authority Act, CAP 469 of Kenya’s Laws (hereinafter “the Act”). Under Section 5 (1) of the Act, the Kenya Revenue Authority is an agency of the Government for the collection and receipt of all tax revenue. Further, under Section 5(2) of the Act with respect to the performance of its functions under subsection (1), the Authority is mandated to administer and enforce all provisions of the written laws as set out in Part 1 and 2 of the First Schedule to the Act for the purposes of assessing, collecting and accounting for all revenues in accordance with those laws. 3. The Respondent halted processing of the entry used by the Appellant to import assorted in-mould printed plastic labels under Import Entry Number 25MBAIM400659154 and the Appellant subsequently declared them under HS Code 3920.20.90 of the 2022 EAC/CET, pending verification of the declared HS Code, where samples were drawn and forwarded to the Tariff Headquarters office. 1. Appellant applied for and was granted advance release of the consignment pending collection and verification of samples by the Respondent, enabling release of the goods pending completion of the review process. 2. The Respondent communicated its findings and classified the consignment under EAC/CET Code 4911.99.90. on 17 April 2025 and held that the initially declared HS Code 3920.20.90 was inconsistent with its ruling and would be disregarded and thus classifiable under HS Code 4911.99.90 and issued a corrigendum dated 27 June 2025 stating reclassification. 3. The Appellant appealed against the reclassification on 2 July 2025, against the corrigendum 4. The Respondent on 31 July 2025, issued a review decision upholding the corrigendum classification under HS Code 4911.10.00, citing Heading 49.11, Legal Note 2 to Section VII, and General Interpretation Rules 1 and 6, annexing the decision. 5. Dissatisfied with the Respondent’s review decision dated 31 July 2025 upholding its tariff reclassification dated 27 June 2025, the Appellant filed a notice of appeal dated and filed 25th August 2025. # THE APPEAL 1. The Appellant lodged its Memorandum of appeal filed on 8 th September, 2025 and filed on even date raising the following grounds of appeal; 1. THAT the Respondent erred in fact and in law and misdirected itself in misinterpreting the provisions of the East African Community Common External Tariff as to the nature of the Appellant's imports, which are illustrated and printed labels of plastic, specifically designed for in-mould labelling, and not trade advertising materials. 2. THAT the Respondent erred in fact and in law by concluding without basis that the imported labels were meant for distribution, promotion, and marketing of products, instead of product identification and labelling, thereby wrongly classifying them under HS Code 4911.10.00. 3. THAT the Respondent erred in fact and in law in failing to hold that the Appellant's imports which are illustrated and printed labels of plastic are integral to the primary use of the plastic packaging material manufactured by the Appellant and should not be classified under chapter 49 under Legal Note 2 to section VII of the Explanatory Notes of the HS Code. * 1. THAT the Respondent erred in law and in fact in failing to find that the Appellant's products were correctly classified under HS Code 3920.20.90 as other plates, sheets, film, foil and strip, of plastics, noncellular and not reinforced, laminated, supported or similarly combined with other materials- of polymers of propylene. 2. THAT the Respondent erred and misdirected itself in upholding the tariff Reclassification decision dated 27 June 2025, which reclassified the Appellant's Imports from HS code 4911.99.90 to HS code 4911.10.00. 3. THAT the Respondent's act of issuing a tariff ruling classifying the Appellant's products as 4911.99.90 and subsequently, a month later, reclassifying the products under HS Code 4911.10.00 violates the Appellant's right to Legitimate Expectation. 4. THAT the Respondent's Review Decision is unreasonable and unjust as the Respondent disregarded the Appellant's explanations and documentation provided in its appeal against the Review Decision. # THE APPELLANT’S CASE 1. The Appellant case was premised on: 2. Statement of facts dated and filed on 8th September 2025 and 3. Witness statement of Mr Zadock Olweny dated 23rd March, 2026 and filed on 24th March 2026 was adopted by the Tribunal on the 1st April 2026 as evidence in chief 4. Written submissions dated and filed on 22nd April 2026 5. The Appellant stated that on 5 February 2025, the Respondent issued an alert regarding the tariff classification of the Appellant’s consignment of illustrated and printed plastic labels under import entry number 25MBAIM40065915, where the Appellant had classified the goods under EAC/CET Code 3920.20.90, and annexed the Import Declaration. 6. The Appellant stated that following the alert, it applied for and was granted advance release of the consignment pending collection and verification of samples by the Respondent, enabling release of the goods pending completion of the review process. 7. The Appellant stated that through a Tariff Classification letter dated 17 April 2025, the Respondent communicated its findings and classified the consignment under EAC/CET Code 4911.99.90, annexing the classification letter and that the Respondent justified the classification under Heading 49.11 of the HS Code covering other printed matter, including printed pictures and photographs, noting inclusion of printed plastic films with letters or symbols for design use, and relying on Legal Note 2 to Section VII regarding printed plastic articles where printing is not merely incidental. 1. The Appellant stated that based on the foregoing, the Respondent concluded that the labels, described as illustrated and printed plastic labels for yoghurt and Blue Band containers, were other printed articles of plastics intended for integration into containers and thus classifiable under HS Code 4911.99.90. 2. The Appellant stated that the Respondent consequently held that the initially declared HS Code 3920.20.90 was inconsistent with its ruling and would be disregarded. 3. The Appellant stated that in a surprising development, the Respondent unilaterally and without notice issued a corrigendum dated 27 June 2025 reclassifying the goods from HS Code 4911.99.90 to HS Code 4911.10.00 on the basis that the labels constituted printed plastic screens conveying product information, annexing the corrigendum. 4. The Appellant stated that on 2 July 2025, it appealed against the corrigendum, asserting that the labels were not for promotion or marketing but for identification and statutory compliance, forming an integral part of packaging material, and annexed the appeal. 5. The Appellant stated that in its appeal, it described the nature of the labels and justified classification under EAC/CET Code 4911.99.90, including a detailed explanation of their characteristics and the in-mould labelling process and that the labels are in-mould labels made from BOPP IML Film, being pre-printed semi- finished products used in labelling containers for identification and branding, specifically designed for in-mould applications. 6. The Appellant stated that Biaxially Oriented Polypropylene film is a durable plastic film produced by stretching polypropylene in two directions, enhancing its properties for packaging and labelling, and that its products consist of such stretched plastic used in in-mould labelling, annexing product specifications. 7. The Appellant stated that the in-mould labelling process involves placement of labels into mould cavities by robots, holding them in place, injecting plastic to encapsulate the label, cooling and ejecting the finished product with the label fused, and automated handling thereafter. 1. The Appellant stated that based on this process, the labels form an integral part of packaging material used for identification and are not advertising or promotional materials as alleged. 2. The Appellant stated that HS Code 4911.10 relates to trade advertising materials while HS Code 4911.90 covers other printed matter, which it maintained as the appropriate classification and that on 31 July 2025, the Respondent issued a review decision upholding the corrigendum classification under HS Code 4911.10.00, citing Heading 49.11, Legal Note 2 to Section VII, and General Interpretation Rules 1 and 6, annexing the decision. 3. The Appellant stated that being dissatisfied with the review decision, it lodged the present appeal before the Tribunal pursuant to Section 12 of the Tax Appeals Tribunal Act as read with Section 230 of EACCMA. 4. The Appellant stated that the Respondent erred in concluding that the labels were meant for promotion and distribution rather than identification, leading to incorrect classification under HS Code 4911.10.00. 5. The Appellant stated that the Respondent’s position was that the labels were for marketing and promotion and therefore not classifiable under HS Code 4911.99.90, contrary to the Appellant’s position and the General Interpretation Rules. 6. The Appellant stated that the Respondent in its Review decision maintained that the labels provided useful product information and thus fell under HS Code 4911.10.00 and that Heading 49.11 includes other printed matter, with HS Code 4911.99.90 attracting 25% import duty. 7. The Appellant stated that HS Code 4911.10.00 covers trade advertising materials attracting 35% import duty, annexing relevant tariff excerpts and that pictorial representations demonstrate that the labels serve identification purposes, as confirmed during the Respondent’s site visit. 8. The Appellant stated that understanding the labels’ nature is essential to appreciate their legal necessity under Kenyan statutory labelling requirements and that Rule 7 of the Weights and Measures (Sale and Labelling of Goods) Rules mandates labelling of pre-packaged goods with product details including manufacturer, weight, and dates. 9. The Appellant stated that the law requires clear labelling of pre-packed goods with essential product information and consequently, the in-mould labels are essential components of packaging as clients must comply with statutory labelling requirements. 1. The Appellant stated that therefore the labels are used for product identification and compliance with legal requirements, not for promotion as alleged, therefore the Respondent erred in failing to recognize that the labels are integral to packaging and properly classifiable under HS Code 3920.20.90 or alternatively 4911.99.90. 2. The Appellant Stated that Legal Note 2 to Section VII provides that plastics remain classified under Chapter 39 unless printing gives them the essential character of printed matter and that its labels are made from BOPP IML Film falling within HS Code 3920.20.90, covering plastic films whether printed or not, annexing supporting documents. 3. The Appellant stated that printing does not alter the essential character of the labels as packaging material, as printing is incidental to their primary function. 4. The Appellant stated that this position aligns with the decision in **Amcor Flexibles Kreuzlingen AG v United States (Slip Op. 22-15, 2022)**, where printed packaging retained its classification as packaging material and the Court emphasized that printing necessary for information does not override the essential identity of packaging material. 1. The Appellant stated that similarly, its labels retain their essential nature as polypropylene packaging film fused into containers during moulding, warranting classification under HS Code 3920.20.90 alternatively, if not under Chapter 39, the correct classification would be HS Code 4911.99.90 as other printed matter used for identification rather than advertising. 2. The Appellant stated that it relied on a World Customs Organization classification opinion from its 42nd Session, concerning printed aluminium labels used for identification rather than promotion and that the WCO held such labels are not classifiable under HS Code 4911.10 but under HS Code 4911.99 as other printed matter. 3. The Appellant stated that therefore the Respondent disregarded clear EAC CET provisions and supporting documentation in reclassifying the goods and that the Respondent’s reclassification violated the doctrine of legitimate expectation by reversing its earlier tariff ruling without notice or justification. 4. The Appellant stated that legitimate expectation protects against abrupt administrative changes where a clear representation has been made and that it relied on the initial classification ruling in planning its imports and compliance, and the subsequent reversal undermined predictability. 1. The Appellant stated that the correct classification remains under HS Code 3920.20.90 or alternatively 4911.99.90, and that the reclassification to 4911.10.00 was erroneous and unlawful and that the Respondent’s review decision was unreasonable and unjust for disregarding its explanations and documentation. 2. The Appellant stated that the Respondent maintained that the labels were for promotion rather than identification and had provided detailed explanations in its appeal dated 2 July 2025, including the labelling process. 3. The Appellant stated that the Respondent had visited its plant and observed the process, yet still reclassified the goods unfairly and that the Tribunal in **Cyma Limited v Commissioner of Legal Services & Board Co-ordination [2024]** **KETAT 616 (KLR)** emphasized the Respondent’s duty to substantiate its assertions with evidence. 1. The Appellant stated that it had clearly explained the rationale and legal basis for classification under HS Code 4911.99.90, which the Respondent initially agreed with before reversing without justification. 2. In the witness statement, the Appellant stated that its business involves the manufacture of rigid and flexible plastic packaging products such as yoghurt cups and Blue Band containers supplied to consumer goods companies within Kenya and the East African region. 3. In the witness statement, the Appellant stated that to manufacture these products, it imports in mould labels made of BOPP IML Film, which are pre- printed and inserted into moulds before plastic injection, resulting in the label being permanently fused into the container surface. 4. In the witness statement, the Appellant stated that it imported a consignment of illustrated and printed plastic labels under Import Entry Number 25MBAIM40065915 and declared them under EAC/CET Code 3920.20.90, as evidenced in the Record. 5. In the witness statement, the Appellant stated that on 5 February 2025, the Respondent raised an alert and took samples for verification, after which the Appellant applied for and was granted advance release of the goods pending verification. 6. In the witness statement, the Appellant stated that on 17 April 2025, the Respondent issued a tariff classification ruling classifying the labels under HS Code 4911.99.90 as “other printed matter,” which the Appellant accepted and relied upon. 7. In the witness statement, the Appellant stated that on 27 June 2025, the Respondent issued a corrigendum without notice or explanation, reclassifying the same goods under HS Code 4911.10.00 as trade advertising material, despite no change in the product, its use, or the law. 8. In the witness statement, the Appellant stated that prior to the corrigendum, the Respondent’s officers had conducted a physical inspection at its plant and observed the in-mould labelling process. 9. In the witness statement, the Appellant stated that it filed an application for review on 2 July 2025 explaining that the labels are manufacturing inputs fused into packaging and not advertising materials, providing supporting documentation and detailed explanations of the process. 10. In the witness statement, the Appellant stated that on 31 July 2025, the Respondent issued a review decision upholding classification under HS Code 4911.10.00 without addressing the Appellant’s explanations. 11. In the witness statement, the Appellant stated that the imported labels are pre-printed in-mould labels made of BOPP IML Film and are not intended for advertising or promotion but solely for labelling plastic packaging products with product identification information. 12. In the witness statement, the Appellant stated that the labels contain essential product details including product name, manufacturer details, net weight, and manufacture and expiry dates. 13. In the witness statement, the Appellant stated that such information is mandated under Rule 7 of the Weights and Measures (Sale and Labelling of Goods) Rules, making the labels legally necessary for pre-packaged goods. 14. In the witness statement, the Appellant stated that its clients are required by law to include such information on packaging, and therefore the labels are indispensable components of the packaging. 15. In the witness statement, the Appellant stated that although the labels bear trademarks of clients, such marks serve identification purposes only and do not constitute advertising or promotion and that pictorial representations inspected by the Respondent confirm that the labels contain only product identification information. 1. In the witness statement, the Appellant stated that the labels are purely manufacturing inputs permanently incorporated into packaging through the in- mould labelling process, forming an inseparable part of the finished container and that the labels are made from Biaxially Oriented Polypropylene film, produced by stretching polypropylene in two directions to enhance packaging properties, as confirmed by supplier specifications. 2. In the witness statement, the Appellant stated that the in-mould labelling process involves placement of labels into mould cavities, securing them, injecting molten plastic to encapsulate them, cooling, and ejecting finished containers with labels fused onto the surface and that as a result, the labels become inseparable from the final product and constitute semi-finished inputs integrated at the manufacturing stage. 3. In the witness statement, the Appellant stated that the Respondent initially classified the goods under HS Code 4911.99.90 as other printed articles intended for integration into product containers, which classification the Appellant relied upon and that the Respondent later reclassified the same goods under HS Code 4911.10.00 without identifying any change in facts or circumstances and without prior notice. 4. In the witness statement, the Appellant stated that the initial classification created a legitimate expectation that future imports would be treated similarly, and that the subsequent reclassification constituted an unjustified departure from that expectation. 5. In the witness statement, the Appellant stated that the labels are fundamentally BOPP IML Film used for statutory product identification and retain the essential character of polypropylene plastic film rather than printed matter. 6. In the witness statement, the Appellant stated that the correct classification is HS Code 3920.20.90, or alternatively HS Code 4911.99.90 as other printed matter and that classification under HS Code 4911.10.00 as trade advertising material is inconsistent with the nature, function, and use of the labels and applicable tariff provisions. 7. In the witness statement, the Appellant stated that it prays that the Tribunal sets aside the Respondent’s decision and confirms the proper classification under HS Code 3920.20.90 or alternatively HS Code 4911.99.90. 8. In the witness statement, the Appellant stated that the Respondent failed to properly consider the explanations and documentation provided, which led to an erroneous conclusion and that the Respondent misconstrued both factual and legal positions, resulting in a tariff decision lacking merit. 1. In the witness statement, the Appellant stated that it will produce samples of unfinished containers and imported labels as exhibits at the hearing, which are already part of the Record. 2. The Appellant further submitted that on 5 February 2025, the Respondent raised an alert on the consignment imported under Entry Number 25MBA1M40065915 and undertook a tariff verification exercise. Following physical inspection of the Appellant’s manufacturing facility and the in mould labelling process, the Respondent issued a tariff ruling dated 17 April 2025 classifying the goods under HS Code 4911.99.90 as “Other printed matter.” The Appellant contended that it accepted and relied upon that ruling. 3. It submitted that on 27 June 2025, the Respondent, without prior notice or consultation, issued a corrigendum reclassifying the same goods under HS Code 4911.10.00 as “Trade advertising material” despite there being no change in the composition, nature or use of the goods. The Appellant objected to the reclassification on 2 July 2025, contending that the labels constituted manufacturing inputs permanently incorporated into plastic packaging products and merely contained statutory product identification information required under Rule 7 of the Weights and Measures (Sale and Labelling of Goods) Rules. 4. The Appellant submitted that during the hearing, its witness Mr. Zadock Olweny testified that the branding, logos and pictorial elements appearing on the labels are entirely dictated by the Appellant’s customers and are solely intended for product identification and compliance with statutory requirements. The witness further demonstrated through physical samples that once fused into the container during the moulding process, the labels cease to exist as separate items and become integral components of the finished packaging product. 5. The Appellant identified four issues for determination namely whether the Respondent’s reclassification under HS Code 4911.10.00 was inconsistent with the nature and use of the goods, whether the corrigendum breached the Appellant’s legitimate expectation, whether the correct tariff classification was HS Code 3920.20.90 or alternatively HS Code 4911.99.90, and whether the Review Decision was unreasonable for disregarding the Appellant’s explanations and supporting documents. 6. On the issue whether the goods constituted trade advertising material, the Appellant submitted that the Respondent’s classification was fundamentally inconsistent with the nature, function and use of the imported labels. It argued that the defining characteristic of trade advertising material is the intention to attract customers and promote sale of goods or services and relied on the Merriam Webster Dictionary definition of the term “advertise” as meaning presenting something to the public in a manner intended to attract customers. 1. The Appellant submitted that the imported goods were not standalone advertising materials but rather thin plastic films engineered to be fused into plastic containers during manufacturing, thereby becoming inseparable components of the finished packaging. According to the Appellant, once incorporated into the packaging, the labels served only to identify the product and communicate mandatory statutory information. 2. The Appellant contended that the labels contained only mandatory information including the product name, manufacturer’s details, net weight and manufacture and expiry dates, as required under Rule 7 of the Weights and Measures (Sale and Labelling of Goods) Rules. It argued that such information is regulatory and identificatory in nature and does not amount to promotional or advertising material. 3. It was further submitted that the labels are never distributed independently or circulated in the market as standalone advertising items but instead become permanently fused into the finished containers and therefore cannot logically constitute trade advertising material. 4. In support of this position, the Appellant relied on **Kenya Breweries Limited v Commissioner of Customs and Border Control, Tax Appeal No. 282 of 2020** where the Tribunal emphasised that tariff classification must be based on the objective characteristics and properties of goods as presented at importation and cautioned against reliance on superficial indicators. The Appellant particularly cited the Tribunal’s holding that Section and Chapter titles merely guide classification and that goods may ultimately fall within or outside a heading notwithstanding the wording of the titles. 1. The Appellant submitted that the Respondent improperly relied on the mere presence of printed content on the labels to classify them as advertising material without interrogating their true nature, function and intended use. It further argued that the Respondent ignored the structured application of the General Rules of Interpretation, particularly GIR 1, contrary to the principles emphasised # in Kenya Breweries Limited v Commissioner of Customs and Border **Control**. 1. The Appellant also submitted that the purpose and use of the labels are functional rather than promotional since they form permanent components of packaging and facilitate compliance with statutory labelling requirements. It argued that the objective characteristics of the BOPP plastic film labels are wholly inconsistent with trade advertising material and that the Respondent’s classification lacked factual and legal basis. 2. The Appellant submitted that although the Respondent argued that the printed designs on the labels serve branding and communicative purposes, the Respondent failed to demonstrate how the labels met the threshold of advertising material. According to the Appellant, the labels contain no persuasive messages, promotional slogans or marketing claims intended to influence consumer behaviour. 3. The Appellant further relied on the *ejusdem generis principle* in interpreting the phrase “and the like” appearing under HS Code 4911.10.00. In support of this argument, the Appellant relied on **Attorney General v Okiya Omtatah Okoiti** **& 3 Others [2020] eKLR** where the Court explained that general words following specific words must be restricted to items of the same class or genus as those specifically enumerated. 1. Based on the foregoing authority, the Appellant argued that the genus contemplated under Heading 4911.10.00 relates to promotional and marketing materials intended for dissemination to the public for purposes of commercial persuasion. The Appellant contended that its labels do not belong to that category because they are permanently affixed onto products, are not independently distributed and do not serve promotional functions. 2. On the issue of legitimate expectation, the Appellant submitted that the Respondent’s issuance of the corrigendum without prior notice, without change in the nature of the goods and without any change in the applicable law violated the Appellant’s legitimate expectation and right to fair administrative action under Article 47 of the Constitution. 3. The Appellant relied on **Keroche Industries Limited v Kenya Revenue Authority & 5 Others [2007] eKLR** where the High Court held that legitimate expectation serves the public interest in ensuring that public authorities honour their representations and established practices so as to promote certainty, trust and responsible administration. The Court further held that a public authority may only depart from a representation where there exists sufficient overriding public interest. 1. The Appellant submitted that the Respondent’s tariff ruling dated 17 April 2025 constituted a clear and authoritative representation upon which the Appellant legitimately relied in structuring its import declarations and commercial operations. According to the Appellant, the subsequent unilateral reversal through the corrigendum, without notice or justification, was arbitrary and unlawful. 2. The Appellant further relied on **Kenya Revenue Authority & 2 Others v Darasa Investments Limited [2018] eKLR** where the Court of Appeal stated that where a public authority leads a party to expect that it will continue acting in a particular manner, it should not resile from that representation without overriding public interest particularly where the affected party has acted upon the representation to its detriment. 1. The Appellant submitted that the Respondent neither identified any error in the original ruling nor pointed to any change in the law, tariff structure or explanatory notes that justified the reclassification. It argued that the Respondent’s attempt to characterise the corrigendum as merely correcting a typographical error was untenable because the original ruling had followed a comprehensive verification exercise including physical inspection of the manufacturing process. 2. The Appellant contended that the Respondent, as a public authority, is obliged to act consistently and predictably particularly where its decisions carry immediate financial consequences. It argued that the Respondent’s unexplained departure from its own formal ruling amounted to arbitrary and procedurally unfair administrative action contrary to the principles enunciated in **Kenya** # Revenue Authority & 2 Others v Darasa Investments Limited [2018] eKLR. 1. On the issue of the proper tariff classification, the Appellant submitted that the goods are correctly classifiable under HS Code 3920.20.90 covering polypropylene plastic film and alternatively under HS Code 4911.99.90 as “Other printed matter.” The Appellant argued that the essential character of the goods is derived from the BOPP plastic film which provides the structural integrity and suitability required for the in-mould labelling process. 2. The Appellant relied on GIR 1 of the General Rules of Interpretation and Note 10 to Chapter 39 of the Explanatory Notes which provide that headings 39.20 and 39.21 cover printed or surface worked plates, sheets, film, foil and strip of plastics provided they are not further worked. The Appellant emphasised that plastic film under Heading 39.20 may either be printed or unprinted. 1. It was submitted that the fact that the Appellant’s film was pre printed for in mould labelling applications does not alter its essential character as plastic film intended for integration into packaging. The printing, according to the Appellant, remains incidental to the label’s primary packaging function. 2. The Appellant further submitted that Legal Note 2 to Section VII of the Harmonized System confirms that plastics and articles thereof remain classifiable under Chapter 39 notwithstanding printing unless such printing alters their essential character. The Appellant argued that the printing in the present case did not alter the essential character of the goods as polypropylene packaging film. 3. In support of this position, the Appellant relied on **Amcor Flexibles Kreuzlingen AG v United States (Slip Op. 22 13, 2022)** where the United States Court of International Trade held that printing on packaging material does not alter its essential character where the product remains fundamentally a packaging input. The Court observed that although printing may convey product information, it does not transform packaging material into printed matter for tariff classification purposes. 1. The Appellant also relied on **L’Oréal East Africa Limited v Commissioner of Customs and Border Control (Tax Appeal E077 of 2024) [2025] KETAT 170 (KLR)** where the Tribunal reaffirmed that classification of composite goods must be determined according to the material or component conferring the essential character pursuant to GIR 2(b) and GIR 3(b). 1. The Appellant argued that the polypropylene substrate provides the structural integrity, heat resistance and durability necessary for the in mould labelling process and therefore imparts the essential character of the goods. According to the Appellant, the printing is entirely subordinate to the polypropylene substrate and cannot determine classification. 2. The Appellant further submitted that the Respondent erred in treating the printed nature of the labels as determinative of classification contrary to the principles affirmed in **L’Oréal East Africa Limited v Commissioner of** # Customs and Border Control. 1. That without prejudice to its primary position under HS Code 3920.20.90, the Appellant submitted that if the Tribunal were to find that the printing removed the goods from Chapter 39, the correct residual classification would still be HS Code 4911.99.90 as “Other printed matter.” 2. In this regard, the Appellant relied on the World Customs Organization Classification Opinion adopted at its 42nd Session which held that printed labels intended for product identification do not constitute trade advertising material under HS Code 4911.10.00 but rather fall under HS Code 4911.99 as “Other printed matter.” The Appellant quoted the WCO finding that labels used for product identification rather than advertising cannot be classified as trade advertising material. 1. The Appellant therefore submitted that the Respondent disregarded the provisions of the EACCET, the Explanatory Notes and the Appellant’s explanations and documentation in erroneously classifying the goods under HS Code 4911.10.00. 2. On the issue whether the Review Decision was unreasonable and unjust, the Appellant submitted that the Respondent disregarded the Appellant’s detailed explanations and supporting documents without providing a reasoned basis for rejecting them. 3. In support of this argument, the Appellant relied on **Hymn Limited v Commissioner of Legal Services and Board Coordination [2024] KETAT 616 (KLR)** where the Tribunal held that where a taxpayer furnishes explanations and supporting documents, the Respondent bears a corresponding duty to meaningfully consider them and provide detailed reasons for any rejection thereof. 1. The Appellant submitted that despite furnishing explanations, product specifications, pictorial representations and evidence of the manufacturing process, the Respondent failed to meaningfully engage with the material presented and instead maintained the impugned classification without cogent justification. 2. In conclusion, the Appellant urged the Tribunal to find that the imported in mould labels are properly classifiable either under HS Code 3920.20.90 as polypropylene plastic film or alternatively under HS Code 4911.99.90 as “Other printed matter.” The Appellant further urged the Tribunal to hold that the Respondent’s classification under HS Code 4911.10.00 was erroneous, inconsistent with the nature and function of the goods, and made in breach of the Appellant’s legitimate expectation and right to fair administrative action. # Appellant prayers 1. The Appellant prayed for the following ORDERS: 2. THAT the Appeal be and is hereby allowed. 3. THAT the Respondent's Review Decision dated 31 July 2025 upholding its tariff reclassification dated 27 June 2025 be and is hereby set aside. 4. THAT an order be and is hereby issued that the Appellant's products are correctly classified under HS Code 3920.20.90 5. in the alternative, without prejudice to (3) above THAT an order be and is hereby issued that the Appellants products are correctly classified under HS Code 4911.99.90. 6. THAT the costs of the Appeal be and are hereby awarded to the Appellant. 7. Any other or further remedies which the Tribunal deems just and reasonable. # THE RESPONDENT’S CASE 1. In response to the Appeal, the Respondent filed its Statement of facts dated 8th September 2025 and filed on 9th October 2026. 2. The Respondent stated that the Appellant imported assorted in-mould printed plastic labels under Import Entry Number 25MBAIM400659154 and declared them under HS Code 3920.20.90 of the 2022 EAC/CET. 3. The Respondent stated that processing of the entry was halted pending verification of the declared HS Code, and samples were drawn and forwarded to the Tariff Headquarters office and following verification, it issued a tariff ruling on 17 April 2025 under reference KRA/CBC/BIA/THQ/1147/04/2025. 4. The Respondent stated that the profiling and targeting unit identified possible misclassification and proposed HS Code 4911.99.90 as the appropriate classification and that the ruling was later corrected through a corrigendum dated 27 June 2025, reclassifying the goods from HS Code 4911.99.90 to HS Code 4911.10.00, annexing the corrigendum. 5. The Respondent stated that the Appellant lodged an objection and application for review through a letter dated 2 July 2025, subsequently it issued its review decision on 31 July 2025, annexing the decision. 6. The Respondent stated that in response, it maintains that it did not err in fact or law in classifying the imported labels under HS Code 4911.10.00, having properly considered their purpose and use in line with tariff provisions and that the Respondent stated that the Appellant had initially classified the labels under HS Code 3920.20.90 treating them as plastic sheets or film under Chapter 39. 1. The Respondent stated that such classification overlooks that the labels bear printed motifs, logos, and commercial information that are integral and not merely incidental to their purpose and that under classification guidelines, except for goods under headings 39.18 or 39.19, plastics printed with motifs or pictorial representations that are not incidental to their primary use fall under Chapter 49 covering printed matter. 2. The Respondent stated that in this case the printed designs perform a key commercial and communicative role including branding and product information, thereby giving the goods their essential character, and justifying classification under HS Code 4911.10.00 as trade advertising material. 3. The Respondent stated that although the goods are plastic labels used in in-mould labelling, their classification as trade advertising material remains correct, lawful, and consistent with tariff provisions and that classification under Chapter 49 was properly applied pursuant to Legal Note 2 to Section VII of the Explanatory Notes of the HS Code in accordance with established legal principles. 4. The Respondent stated that the corrigendum issued reclassifying the goods was intended to correct a typographical error in the earlier tariff classification and that the initial classification under HS Code 4911.99.90 was incorrect and that HS Code 4911.10.00 correctly reflects the nature of the goods as printed trade advertising material. 5. The Respondent stated that the correction did not arise from any change in product characteristics, use, or interpretation, but was meant to align documentation with the correct classification and Appellant’s claim of violation of legitimate expectation is therefore incorrect and misleading. 6. The Respondent stated that in making its determination, it applied the General Interpretation Rules and the Explanatory Notes to the Harmonized System and that tariff classification is governed under the East African Community Customs Management Act, 2004 and the EAC Common External Tariff 2017 and 2022. 7. The Respondent stated that although the Appellant alleges failure to consider its documentation, it has not specified which documents were allegedly ignored and that the World Customs Organization ruling relied upon by the Appellant concerns aluminium labels with paper backing, which differ materially from the plastic labels in issue. 1. The Respondent stated that unlike aluminium labels applied after manufacture, the subject goods are in-mould plastic labels made of polymers and integrated into products during the moulding process and that these labels are embedded within the plastic product, offering different functionality and durability compared to aluminium labels. # The Respondent Prayers 1. The Respondent prayed that the; 2. Tribunal dismisses the Appeal with costs for lack of merit and; 3. Upholds the Respondent’s Review decision dated 31 July 2025. # ISSUE FOR DETERMINATION 1. The Tribunal has evaluated the parties’ pleadings and it is of the view that the Tribunal has one issue that call for its determination is; **Whether the Respondent erred in reclassifying the Appellant’s imports under the HS** # Code 4911.10.00 **ANALYSIS AND FINDINGS** 1. Having identified the issues for determination, the Tribunal proceeds to analyse the same as hereunder; # a. Whether the Respondent erred in reclassifying the Appellant’s imports under the HS Code 4911.10.00 1. The Tribunal has reviewed the context of the dispute that arises from the importation by the Appellant of in-mould printed plastic labels under Import Entry Number 25MBAIM400659154, declared on 5th February 2025 under HS Code 3920.20.90 as polypropylene plastic film. 2. Following an alert and sampling by the Respondent, a tariff ruling issued on 17th April 2025 classified the goods under HS Code 4911.99.90 as other printed matter, a position initially accepted by the Appellant. However, on 27th June 2025, the Respondent issued a corrigendum reclassifying the same goods under HS Code 4911.10.00 as trade advertising material without prior notice or any change in the nature, composition, or use of the goods. 3. The Appellant promptly objected through an application for review dated 2nd July 2025, asserting that the labels were integral manufacturing inputs used for statutory product identification rather than advertising. Despite these representations, the Respondent upheld its position in a Review Decision dated 31st July 2025, leading to the filing of the present Appeal on 8th September 2025. 1. The dispute crystallizes around the proper tariff classification of the imported labels and the legality of the Respondent’s reclassification. The Tribunal is therefore called upon to determine whether the goods are correctly classifiable under HS Code 3920.20.90 as plastic film, or alternatively under HS Code 4911.99.90 as other printed matter, or as maintained by the Respondent under HS Code 4911.10.00 as trade advertising material. 2. The Appellant’s case is that it correctly classified the imports under HS Code 3920.20.90. On the other hand, the Respondent’s case is that it correctly reclassified the imports under HS Code 4911.10.00. 3. The classification of commodities in EAC is governed by EAC Customs Union Common External Tariff. The Tribunal is guided by the General Interpretative Rules for The Classification of Goods (GIRs) which sets out principles of classification of goods in the Nomenclature. GIR 1 provides *inter alia*: *1. The titles of Sections, Chapters and sub-Chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided such headings or Notes do not otherwise require…* 1. It is also vital to note that classification of goods in the subheadings of a heading is determined according to the terms of those subheadings and any related Subheading Notes *mutatis mutandis.* In this regard, GIR 6 provides that: *For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related Subheading Notes and, mutatis mutandis, to the above Rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this Rule the relative Section and Chapter Notes also apply, unless the context otherwise requires.* 1. The Respondent’s preferred HS Code 4911.10.00 provides as follows: *49.11 Other printed matter, including printed pictures and photographs.* *4911.10.00 - Trade advertising material, commercial catalogues and the like* 1. The Respondent argued that the imported in-mould printed plastic labels derived their essential character not from the polypropylene plastic film on which they were produced but from the printed logos, motifs, branding elements and commercial information appearing on them. According to the Respondent, the printing was not merely incidental to the goods but constituted their primary commercial and communicative function. The Respondent maintained that the labels served to communicate product information and branding to consumers and therefore possessed the character of printed matter rather than ordinary plastic film. 2. The Respondent maintained that the imported in-mould printed plastic labels were correctly classified under HS Code 4911.10.00 as trade advertising material rather than under HS Code 3920.20.90 or 4911.99.90. It argued that the labels derive their essential character from the printed logos, branding and product information appearing on them, making them printed matter under Chapter 49 rather than plastic film under Chapter 39. The Respondent relied on Legal Note 2 to Section VII of the Harmonized System, which provides that printed plastics whose printing is not merely incidental to their use are classifiable as printed matter. 3. The Respondent further contended that the corrigendum changing the classification from HS Code 4911.99.90 to 4911.10.00 merely corrected a typographical error and did not amount to a change in position or breach of legitimate expectation. It argued that no legitimate expectation can arise from an incorrect classification that is contrary to the law. 4. The Respondent denied disregarding the Appellant's explanations and documents, maintaining that it considered all relevant materials and applied the applicable customs laws and tariff provisions. It also rejected the Appellant's reliance on a World Customs Organization classification opinion concerning aluminium labels, arguing that the ruling was distinguishable because it involved materially different products from the plastic in-mould labels in dispute. 5. On the other hand, the Appellant’s preferred tariff code of choice, HS Code 3920.20.90 provides as follows: *39.20 Other plates, sheets, film, foil and strip, of plastics, noncellular and not reinforced, laminated, supported or similarly combined with other materials.* *3920.20.90 --- Other* 1. Both parties agree that the articles that the Appellant imported are key to the container onto which they are affixed. Whereas the Appellant argued that the articles used to identify the product and are also used for purposes complying with statutory provisions and in particular Rule 7 of the Weights and Measures (Sale and Labelling of Goods) Rules Legal Notice 24 of 1999, the Respondent argued that the imported plastic labels were meant for promotion and advertisement, as the labels were printed articles whose principal function was to convey information and promote the branded products. 1. The Tribunal has carefully considered Note 2 of **Section VII of the EAC/CET which provides as follows:** *Except for the goods of heading 39.18 or 39.19, plastics, rubber, and articles thereof, printed with motifs, characters or pictorial representations, which are not merely subsidiary to the primary use of the goods, fall in Chapter 49.* 1. The Tribunal has carefully examined the samples, product specifications, photographs and evidence relating to the imported goods. The goods consist of pre-printed in-mould labels manufactured from biaxially oriented polypropylene (BOPP) film. The labels bear product names, trademarks, logos, ingredients, nutritional information, manufacturer details, volume declarations and other product-specific information. The Tribunal is satisfied that the printing appearing on the labels is not merely decorative or incidental. Rather, the printing is central to the purpose for which the labels are designed and used, namely the identification of finished products and communication of product information to consumers. 2. The Tribunal further notes that although the labels are manufactured from plastic film and are ultimately fused into plastic containers during the in-mould labelling process, the mere fact that the substrate is plastic does not determine classification. Pursuant to Note 2 to Section VII of the EAC/CET, where printing is not merely subsidiary to the primary use of the goods, such goods are excluded from Chapter 39 and fall for classification under Chapter 49. In the present case, the Tribunal finds that the printed content imparts the essential character of the imported goods because it is the reason the labels are produced and incorporated into the packaging. 3. Having found that the goods are properly classifiable within Chapter 49, the Tribunal must determine the appropriate subheading. The Respondent classified the goods under HS Code 4911.10.00 as trade advertising material, commercial catalogues and the like. The Tribunal is unable to agree with that classification. 4. The Explanatory Notes to Heading 49.11 indicate that trade advertising material generally consists of printed matter whose principal purpose is to promote, market or advertise goods or services. Such materials are ordinarily intended to influence purchasing decisions or attract customers through promotional content. The evidence before the Tribunal does not demonstrate that the imported labels perform such a function. 5. The Tribunal finds that the information appearing on the labels, including product names, ingredients, nutritional values, manufacturer details, trademarks, logos and volume declarations, serves primarily to identify the packaged products and communicate information required by law and commercial practice. While branding elements may incidentally contribute to product recognition, that fact alone does not transform the labels into trade advertising material within the meaning of HS Code 4911.10.00. 6. The Tribunal is persuaded that the imported labels are printed articles intended for permanent incorporation into packaging and are principally used for product identification, traceability and compliance with statutory labelling requirements, including those prescribed under Rule 7 of the Weights and Measures (Sale and Labelling of Goods) Rules. Accordingly, although the goods fall within Chapter 49 by virtue of Note 2 to Section VII, they do not constitute trade advertising material. 7. The Tribunal therefore finds and holds that the Respondent erred in classifying the imported goods under HS Code 4911.10.00. Having found that the goods are properly classifiable under Chapter 49 and are not trade advertising material, the Tribunal concludes that the appropriate classification is HS Code 4911.99.90 – Other printed matter. 8. Consequently, the Appeal herein is merited. # FINAL DECISION 1. The upshot to the foregoing is that the Tribunal finds and holds that the Appeal succeeds and makes the following Orders: 2. The Appeal be and is hereby allowed; 3. The Respondent’s Review Decision on 31 st July 2025 be and is hereby set aside; 4. Each party to bear its own cost. 5. It is so Ordered. # DATED AND DELIVERED AT NAIROBI ON THIS 26TH DAY OF JUNE 2026 SIGNED BY/FOR: **★ TH E JUDICIAR Y O F KENY A ★** **HON. ROBERT MUGAMBI MUTUMA (CHAIRPERSON) HON. EUNICE NJERI NGANGA HON. BONIFACE KIBIY TERER DOMINIC KIPKEMOI RONO HON. BILLY GRAHAM OKUMU MIJUNGU** Tax Appeals Tribunal Tribunal Date: 2026-06-26 15:38:08