United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 1995 HQ Rulings > HQ 113529 - HQ 224789 > HQ 113531

Previous Ruling Next Ruling
HQ 113531




August 31, 1995

BOR-7-07-R:IT:C 113531 GEV

CATEGORY: CARRIER

P. Michael Lawrentz
General Manager
Mansfield Box & Paper Co., Inc.
Post Office Box 1414
Mansfield, Ohio 44901-1414

RE: Instruments of International Traffic; Flexible Intermediate Bulk Containers; 19 U.S.C. ? 1322

Dear Mr. Lawrentz:

This is in response to your letter dated July 12, 1995, requesting a ruling that certain Flexible Intermediate Bulk Containers (FIBCs) are instruments of international traffic. Your letter was forwarded to this office for direct response. Our ruling is set forth below.

FACTS:

Mansfield Bag and Paper Co., Inc., ("Mansfield") will purchase FIBCs from Sanjut, a company located in Istanbul, Turkey, and store them in or near Mansfield, Ohio. The FIBCs will be used continuously for the transportation of edible beans from the U.S. and Canada to the U.K.

Upon direction of the canners in the U.K., Mansfield will ship a specified number of these FIBCs to a shipper/processor in the Michigan, North Dakota, or Ontario, Canada, regions where the FIBCs will be filled with edible beans and exported to the U.K. Upon receipt of shipment, the FIBCs will be emptied and then collected for shipment back to the U.S. entering through Cleveland, Ohio. Mansfield will then clean and inspect the FIBCs in order to ready them for reuse. These FIBCs will be distributed in like manner to the shipper/processors to be filled with beans to be exported to the U.K. again. The cycle will continue to repeat itself.

Included with the Mansfield letter of July 12 is the following documentation: a list of canners in the U.K. (Exhibit A); a list of shippers/processors in Michigan, and Canada (Exhibit B); specifications for two of the multi-use, 2 ton FIBCs (Exhibit C); copies of photographs of the FIBCs in question (Exhibit D); and a flow chart showing the recycling of these FIBCs for continued reuse (Exhibit E).

In regard to the specifications provided in Exhibit C, we note that among other things there will be two sizes of the FIBCs (42"x42"x80" and 38"x38"x82"), and both sizes will be made of uncoated, woven, polypropylene, white opaque sewn fabric with polypropylene thread. Furthermore, both sizes will have a safe working load of 4200 lbs. There will be approximately 24,000 FIBCs in use in any given year.

ISSUE:

Whether FIBCs used to export edible beans may be designated as instruments of international traffic within the meaning of 19 U.S.C. ? 1322(a) and ? 10.41a, Customs Regulations (19 CFR ? 10.41a).

LAW AND ANALYSIS:

Title 19, United States Code, ? 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 ? 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 ? 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.

Upon reviewing Mansfield's request and the accompanying documentation, we are of the opinion the above requirements have been met. In addition, Customs has previously ruled that certain bags of a similar use and construction as those under consideration qualify as instruments of international traffic pursuant to 19 U.S.C. ? 1322(a) and ?10.41a, Customs Regulations (see T.D. 75-302).

HOLDING:

FIBCs used to export edible beans are designated as instruments of international traffic within the meaning of 19 U.S.C. ? 1322(a) and ? 10.41a, Customs Regulations (19 CFR

Sincerely,

Arthur P. Schifflin

Previous Ruling Next Ruling

See also: