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HQ 112467


March 29, 1993

BOR-7-07-CO:R:IT:C 112467 LLB

CATEGORY: CARRIER

Mr. Tim Di Prinzio
A.N. Deringer, Inc.
30 West Service Road
Champlain, New York 12919-9703

RE: Instruments of International Traffic; Metal-Alloy Mandrels; Molds; 19 U.S.C. 1322

Dear Mr. Di Prinzio:

This is in response to your letter of September 16, 1992, which forwards for our consideration and appropriate response a request for a ruling on whether certain metal-alloy mandrels may be designated as Instruments of International Traffic under Customs Regulations and practice. Our ruling is set forth below.

FACTS:

It is stated that certain mandrels, or molds, are die cast in Canada. The mandrels are made of an alloy consisting of lead, tin, and antimony. The finished mandrels are shipped in their finished form to the United States where the importer, Dow United Technologies Composite Products, Inc., braids graphite around the exterior of the imported articles in order to create an aircraft part. The wrapped mandrels are then returned to Canada where they are melted out of the graphite, leaving only the finished aircraft part. The melted alloy is then used to form other mandrels, and the process is repeated. An opinion is sought as the whether the mandrels arriving in the United States may be designated as Instruments of International Traffic.

ISSUE:

Whether mandrels which are reconstituted as such prior to each arrival in the United States may be designated as Instruments of International Traffic within the meaning of 19 U.S.C. 1322(a) and section 10.41a, Customs Regulations (19 CFR 10.41a).

LAW AND ANALYSIS:

Title 19, United States Code, section 1322(a) (19 U.S.C. 1322(a)), provides that "[v]ehicles and other instruments of international traffic, of any class specified by the Secretary of the Treasury, shall be excepted from the application of the customs laws to such extent and subject to such terms and conditions as may be prescribed in regulations or instructions of the Secretary of the Treasury."

The Customs Regulations issued under the authority of section 322(a) are contained in section 10.41a (19 CFR 10.41a). Section 10.41a(a)(1) specifically designates lift vans, cargo vans, shipping tanks, skids, pallets, caul boards, and cores for textile fabrics as instruments of international traffic.

Section 10.41a(a)(1) also authorizes the Commissioner of Customs to designate other items as instruments of international traffic in decisions to be published in the weekly Customs Bulletin. Once designated as instruments of international traffic, these items may be released without entry or the payment of duty, subject to the provisions of section 10.41a.

To qualify as an "instrument of international traffic" within the meaning of 19 U.S.C. 1322(a) and the regulation promulgated pursuant thereto (19 CFR 10.41a et seq.), an article must be used as a container or holder. The article must be substantial, suitable for and capable of repeated use, and used in significant numbers in international traffic. (See subheading 9803.00.50, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), and former Headnote 6(b)(ii), Tariff Schedules of the United States (HTSUS), as well as Headquarters Decisions 104766; 108084; 108658; 109665; and 109702).

The concept of reuse contemplated above is for commercial shipping or transportation purposes, and not incidental or fugitive uses. Tariff Classification Study, Sixth Supplemental Report (May 23, 1963) at 99. See Holly Stores, Inc. v. United States, 697 F.2d 1387 (Federal Circuit, 1982).

In Holly Stores, supra, the court determined that "reuse" in the context of former General Headnote 6(b)(ii) "has been consistently interpreted to mean practical, commercial reuse, not incidental reuse." (Emphasis added). In that case, articles of clothing were shipped into this country on wire or plastic coat hangers. Evidence showed that the hangers were designed to be, and were of fairly durable construction and that it would be physically possible to reuse them. However, the court found that only about one percent of the hangers were reused in any way at all, and that those uses were of a noncommercial nature. The
court held that the uses of these hangers beyond shipping them once from overseas to the United States were purely incidental, and concluded that the hangers were "not designed for, or capable of, reuse". Subsequent Customs rulings on this matter have held that single use is not sufficient; reuse means more than twice (Headquarter rulings 105567 and 108658). Furthermore, it is our position that the burden of proof to establish reuse is on the applicant, even though the applicant may not be the party reusing the instrument.

The peculiar problem arising in the present matter is that the same article is not being reused each time. Upon each exportation of the mandrels in use, they are completely melted and reformed into new mandrels prior to arriving in the United States ready for use. Each mandrel enters and leaves this country only once in its unique molecular configuration. As such, the mandrels fail the test of repeated use and cannot be designated as desired.

HOLDING:

Metal-alloy mandrels which are melted and reformed prior to each use in the transportation of graphite aircraft parts are, in actuality, used only one time in a unique molecular configuration and thus fail to meet the reuse requirement necessary for designation as Instruments of International Traffic.

Sincerely,

Acting Chief

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