Instruments of International Traffic; 19 U.S.C. § 1322(a); 19 CFR 10.41a(a)(1); Pallet Boxes

HQ H036108 August 27, 2008 BOR-4-07:OT:RR:BSTC:CCI H036108 ALS CATEGORY: Carriers Ms. Brenda Custer-Espeleta National Director Regulatory Compliance EGL Global Brokerage 150 N. Hill Street, Suite 22 Brisbane, California 94005 RE: Instruments of International Traffic; 19 U.S.C. § 1322(a); 19 CFR 10.41a(a)(1); Pallet Boxes Dear Ms. Custer-Espeleta: This is in response to your correspondence, dated August 19, 2008, requesting a ruling as to whether pallet boxes qualify as instruments of international traffic under 19 U.S.C. § 1322(a) and 19 CFR 10.41a(a)(1). Our ruling is set forth below. FACTS: Your client, CEVA Logistics, exports automotive parts to Mexico in pallet boxes. The parts are transported via truck to railcars, by which the parts are transported to Mexico. Once the parts are off-loaded in Mexico, the empty pallet boxes are collapsed and imported back into the United States to be repeatedly used in the same manner. You state that each pallet box, which is manufactured by Orbis Corporation, is made of plastic and lasts approximately five to seven years. Your further provide that approximately 1,200 pallet boxes are used in this operation, they are made to AIAG [Automotive Industry Action Group] specifications,* and each pallet box holds up to 2,000 pounds. The pallet boxes have dimensions of 48 inches by 45 inches by 34 inches, are designed with an open top and 4-way forklift base, two drop doors, and are stackable three high. ISSUE: Whether the pallet boxes described above may be designated as instruments of international traffic pursuant to 19 U.S.C. § 1322(a) and 19 CFR 10.41a(a)(1). LAW AND ANALYSIS: Pursuant to 19 U.S.C. § 1322(a), instruments of international traffic (also referred to herein as “IITs”) shall be excepted from the application of the Customs laws to the extent that such terms and conditions are prescribed in regulations or instructions. Pursuant to 19 CFR 10.41a(a)(1), the Commissioner of Customs and Border Protection (CBP) is authorized to designate as IITs such additional articles not specifically noted in that section. Such IITs may be released without entry or payment of duty. To qualify as an IIT within the meaning of 19 U.S.C. § 1322(a) and 19 CFR 10.41a(a)(1), an article must be used as a container or holder. The article also must be substantial, suitable for and capable of repeated use, and used in significant numbers in international traffic. See Harmonized Tariff Schedule of the United States Annotated subheading 9803.00.50 and CBP Ruling HQ 112303 (August 14, 1992). We have previously ruled on the IIT status of articles of similar materials and construction. In CBP Ruling HQ H025196 (May 15, 2008), citing CBP Ruling HQ 116575 (January 26, 2006), we held that pallets boxes made of steel are IITs. In CBP Ruling HQ 116047 (December 1, 2003), we held that collapsible steel racks that hold automobile transmissions within ocean containers are IITs. In CBP Ruling HQ 115503 (May 30, 2000), we held that hard plastic boxes used to ship integrated circuit wafers qualified as IITs. In CBP Ruling HQ 115506 (October 29, 1998), it was determined that containers made of plastic known as totes that were used to ship various small automobile replacement parts from Japan to the United States met the requirements necessary for designation as IITs. In CBP Ruling HQ 112534 (January 25, 1993), it was held that reusable plastic boxes designed to transport automotive strut components qualified as IITs. We find that our analysis in those cases applies to the subject plastic pallet boxes as well. Thus, upon review of your request, we find that the plastic pallet boxes are substantial, suitable for and capable of repeated use, and are used in significant numbers in international traffic. Therefore, we find that the subject plastic pallet boxes qualify as IITs pursuant to 19 U.S.C. § 1322(a) and 19 CFR 10.41a(a)(1). HOLDING: The subject pallet boxes are hereby designated as IITs pursuant to 19 U.S.C. § 1322(a) and 19 CFR 10.41a(a)(1). Sincerely, Glen E. Vereb Chief Cargo Security, Carriers, and Immigration Branch