Instruments of International Traffic; Steel Pallets andFrames for Transport of Thermal Transfer Print Media; PlasticHubs; 19 U.S.C. 1322(a); 19 CFR 10.41a

HQ 114144 May 6, 1998 BOR-4-07-RR:IT:EC 114144 GG CATEGORY: Carriers Jonathan M. Fee, Esq. Grunfeld, Desiderio, Lebowitz & Silverman LLP 1201 W. Peachtree Street, N.E., Suite 4860 Atlanta, GA 30309 RE: Instruments of International Traffic; Steel Pallets and Frames for Transport of Thermal Transfer Print Media; Plastic Hubs; 19 U.S.C. 1322(a); 19 CFR 10.41a Dear Mr. Fee: This is in response to your ruling request, dated October 21, 1997, made on behalf of your client, Dai Nippon IMS (America) Corp. ("Dai Nippon"). Our ruling follows. FACTS: Dai Nippon imports jumbo rolls of thermal transfer print media from Japan. The company has designed special steel pallets and frames and plastic hubs to facilitate the protection and shipment of the rolls to the United States. Each pallet serves as a base for the frame. Each frame consists of two identical steel end pieces, of tubular construction, which hold each end of the jumbo roll, and four steel tie bars that connect the end pieces together. The hubs are molded plastic pieces that are inserted in either end of the disposable cardboard core around which the thermal transfer print media is wound. The steel frame fits over the hubs, securing the rolls in place. The pallets, frames and hubs are assembled around jumbo rolls ready for shipment from Japan to the United States. After Dai Nippon receives the jumbo rolls in the U.S., it dismantles the pallets, frames and hubs for return to Japan. The pallets are stacked in piles of six or seven. The tie bars are placed diagonally inside each pallet, and the frames are placed upright on the topmost pallet. The hubs are placed in a separate cardboard container to accompany the dismantled pallets and frames on their return to Japan for reuse. Dai Nippon considers these articles to be extremely durable and capable of virtually infinite, continuous use. The company estimates that it will import approximately 500 jumbo rolls of thermal transfer print media a month, using the pallet, frame and hub assembly described above. ISSUE: Whether the described steel pallets and frames and the plastic hubs used for the transportation of thermal transfer print media may be designated as instruments of international traffic within the meaning of 19 U.S.C. 1322(a) and Section 10.41a of the 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 "vehicles 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 1322(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), as well as Headquarters Ruling Letters (HRL) 113279, dated November 23, 1994; 112327, dated April 2, 1993; and 112503, dated December 2, 1992. It is evident from the facts provided that the steel pallet, frame and plastic hub assembly is both substantial and suitable for and capable of repeated use. Furthermore, Dai Nippon's stated intent to import approximately 500 rolls of thermal transfer print media a month indicates that these assemblies will be used in significant numbers in international traffic. Thus it is our opinion that the pallets, frames and hubs qualify as instruments of international traffic. This finding comports with previous determinations made by Customs that shipping containers of similar use and construction as those presently under consideration were instruments of international traffic. See, e.g., HRL 112503, supra, and HRL 113790, dated February 21, 1997 (collapsible, steel reinforced hardwood containers used to transport and protect large rolls of audio visual magnetic tape and rolls of aluminum capacitor foil, respectively, designated as instruments of international traffic); and HRL 113279, dated November 23, 1994 (plastic hubs that fit onto each end of cylindrical cores used to ship magnetic video tape found to be instruments of international traffic). HOLDING: The steel pallets, frames and plastic hubs used to transport and protect thermal transfer print media are instruments of international traffic within the purview of 19 U.S.C. 1322(a) and 19 CFR 10.41a. Sincerely, Jerry Laderberg Chief Entry Procedures and Carriers Branch