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HQ 113687




February 27, 1997

BOR-7-07-RR:IT:EC 113687 CC

CATEGORY: CARRIER

Bruce N. Shulman, Esq.
Stein, Shostak, Shostak & O'Hara
Suite 807
1620 L Street, N.W.
Washington, D.C. 20036-5605

RE: Instruments of International Traffic; 19 U.S.C. ? 1322(a); 19 CFR ? 10.41a

Dear Mr. Shulman:

This is in response to your letter of May 31, 1996, on behalf of Nissan Motor Corporation and Marubeni Motor Service, Inc., requesting that we designate certain metal containers as instruments of international traffic (IIT's).

FACTS:

You state that the collapsible metal containers or racks, with pockets to accommodate handling by fork trucks, will be used to import automobile parts. In a supplemental submission, dated January 29, 1997, you also requested that we find that three additional types of containers, designated as RX1, RX1 with A01 extenders, and RX2, all of similar construction to those of the original request except that they are not collapsible, be designated as IIT's. All of the containers, manufactured in Japan, have a life expectancy of 5 to 8 years.

Your clients advise you that all of the racks will be imported into the U.S. containing automobile parts for Nissan's U.S. Parts Distribution Centers. After the racks are emptied, they will be stored at the Nissan facilities until there is a sufficient quantity to fill a container (approximately 96 racks), after which they will be returned to Japan for reuse in shipping additional parts to the U.S. All racks, even if found damaged or defective, will be shipped back to Japan, and at no time will any of them be diverted into local traffic or used in any manner or for any purpose other than as described above.

ISSUE:

Whether the subject metal containers may be designated as instruments of international traffic within the meaning of 19 U.S.C. ? 1322(a) and 19 CFR ? 10.41a.

LAW AND ANALYSIS:

Section 322(a), Tariff Act of 1930, as amended (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 instruction 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). Paragraph (a)(1) of section 10.41a designates lift vans, cargo vans, shipping tanks and certain other named articles as IIT's and states that other articles may be designated as IIT's by the Commissioner of Customs in a decision to be published in the weekly Customs Bulletin. Once designated as IIT's, 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 (TSUS), as well as Headquarters Ruling Letters (HQs) 104766, dated August 22, 1988; 109665, dated September 12, 1988; and 109702, dated September 30, 1988.

Upon review of the request and accompanying documentation, we are of the opinion that the containers in question are substantial, suitable for and capable of repeated use, and used in significant numbers in international traffic. We have ruled that collapsible steel containers, racks or crates, used to import automobile parts, qualify as IIT's. See Headquarter Ruling Letter (HQ) 110300, dated September 1, 1989; HQ 111163, dated March 26, 1991; HQ 111703, dated October 22, 1991; and HQ 112303, dated August 14, 1992. In addition, we have ruled that large boxes, bins and racks made of metal or wood, having as integral parts thereof feed, lugs, or skids to facilitate movement by fork lifts and similar devices qualify as IIT's. See 107832, dated December 12, 1985 and T.D. 56243. Concerning the containers that are not collapsible, we have found similar containers qualify as IIT's. See HQ 109378, dated April 28, 1988.
Consequently, we find that the subject metal containers qualify as IIT's pursuant to
19 U.S.C. ? 1322(a).

HOLDING:

The subject metal containers qualify as instruments of international traffic and may be released pursuant to 19 CFR ? 10.41a.

Sincerely,

Acting Chief
Entry and Carrier Rulings Branch

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