BOR-4-07-RR:BSTC:CCI 116573 IDL
Linda A. Zanelli
Manager Export Compliance
Zygo Corporation and Subsidiaries
Laurel Brook Road
P.O. Box 448
Middlefield, Connecticut 06455-0448
Re: Instruments of International Traffic; Accessories; Aluminum Carrying Cases; Acrylic Inserts; Subheading 9803.00.50, HTSUSA; 19 U.S.C.
§ 1322; 19 CFR § 10.41a
Dear Ms. Zanelli:
This is in response to your letter on behalf of Zygo Corporation, dated November 8, 2005, requesting a binding ruling on designation of “carrying cases for custom optics” as instruments of international traffic. Our ruling on this matter is set forth below.
FACTS:
Zygo Corporation (“Zygo”) uses two types of aluminum carrying cases to export “corrector plates” (polished glass slabs) to Canon Sales Co. Inc. (“Canon”) in Japan. In preparation for export of the MPA 8000 Corrector Plates (“MPA 8000”) and the MPA 7800 Corrector Plates (“MPA 7800”) (collectively, “the merchandise”), Zygo places the merchandise in acrylic inserts, then places the inserts containing the merchandise in the aluminum cases. After exportation of the merchandise, Canon collects the merchandise and returns the carrying cases and the inserts empty to Zygo for reloading and transport of additional merchandise. A total of twenty carrying cases are used to transport the merchandise.
During a twelve-month period ending June 30, 2005, Zygo exported approximately one hundred carrying cases containing the MPA 8000. Each of these cases, measuring 44.5” x 24.25” x 10.25” and weighing forty-four pounds, contains foam “cut-outs” secured to the base of the case that cushion up to two inserts at a time. The top of each case is removable, with four buckles along the top side to fasten the lid to the container. Each long side has two handles, and each end side has one handle. In addition, each acrylic insert housing the MPA 8000 contains foam that serves to protect one corrector plate during transport. These inserts are available in two designs, measuring 39.75” x 20” x 1.5” or 39.75” x 22.5” x 1.5” and weighing nineteen pounds.
During a twelve-month period ending June 30, 2005, Zygo exported approximately sixty carrying cases containing the MPA 7800. Each of these cases, measuring 30” x 14.75” x 18.75” and weighing twenty-nine pounds, is fitted with four equal slots of foam to cushion up to four inserts at a time. Each case has a handle on the top for ease in carrying. There are two buckles on the long side for opening, and the case top is hinged (i.e., not removable). In addition, each acrylic insert housing the MPA 7800 contains foam that serves to protect one corrector plate during transport. These inserts measure 27.125” x 14.125” x 1.25” and weigh seven and one-half pounds.
You have stated that Zygo normally uses the aluminum carrying cases in international traffic as containers or holders of corrector plates. The cases are capable of repeated use, having a serviceable life of three years. Both the aluminum carrying cases and the acrylic inserts were manufactured in Japan and specifically designed for Canon to import the merchandise. The three types of acrylic inserts are uniquely designed and cannot be used interchangeably. You have provided images and descriptions of the carrying cases and the corresponding inserts.
ISSUES:
(1) Whether the aluminum carrying cases described above may be designated as instruments of international traffic within the meaning of 19 U.S.C. § 1322(a) and section 10.41a, U.S. Customs and Border Protection regulations (19 CFR 10.41a)?
(2) Whether the acrylic inserts described above may be designated as accessories of instruments of international traffic within the meaning of 19 CFR
§ 10.41a(a)(2)?
LAW AND ANALYSIS:
Issue (1)
Title 19, United States Code, section 1322(a) (19 U.S.C. 1322(a)), provides in pertinent part that “[v]ehicles and other instruments of international traffic…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….” The U.S. Customs and Border Protection (CBP) 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 CBP to designate other items as instruments of international traffic (IIT). Once designated as an IIT, these items may be released without entry or the payment of duty, subject to the provisions of section 10.41a.
To qualify as an IIT within the meaning of 19 U.S.C. section 1322(a) and the regulation promulgated pursuant thereto (19 CFR 10.41 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 Schedule of the United States (TSUS), 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 HQ 112371 (December 9, 1992), CBP held that metal racks used for transporting flat glass qualified as IITs. In HQ 116555 (October 25, 2005), CBP held that metal racks, wire containers, and plastic tote bins used to transport automotive parts qualified as IITs.
In the instant case, we find that, based on the information provided, the aluminum carrying cases are used to contain or hold corrector plates during transportation from the United States; they are substantial, suitable for and capable of repeated use; and they are used in significant numbers in international traffic. Accordingly, the aluminum carrying cases meet the requisite criteria to qualify as IITs pursuant to section 1322(a), and may be released without entry or the payment of duty.
Issue (2)
With regard to the acrylic inserts, paragraph (a)(2) of section 10.41a (19 CFR 10.41a(a)(2)) provides the following:
Repair components, accessories, and equipment for any container of foreign production which is an instrument of international traffic may be entered or withdrawn from warehouse for consumption without the deposit of duty if the person making entry or withdrawal from warehouse files a declaration…that the accessory or equipment is for a container of foreign production which is an instrument of international traffic. The port director must be satisfied that the importer of the repair component, accessory or equipment had the declared intention at the time of importation.
(emphasis added)
The information that you have provided indicates that the acrylic inserts are designed for and will be used with the aluminum carrying cases, which we have designated as IITs, and serve as accessories to them. Therefore, based on such information, we find that the acrylic inserts are accessories of instruments of international traffic of foreign production, and are eligible for duty-free treatment pursuant to the provisions of 19 U.S.C. § 1322, subheading 9803.00.50, HTSUSA, and 19 CFR § 10.41a. We note that entry of the acrylic inserts is required under 19 CFR § 10.41a(a)(2). (See also ruling letter 114446 (October 20, 1998)).
HOLDINGS:
(1) The aluminum carrying cases described above may be designated as instruments of international traffic within the meaning of 19 U.S.C. § 1322(a) and 19 CFR § 10.41a.
(2) The acrylic inserts described above may be entered duty-free as accessories of instruments of international traffic within the meaning of 19 CFR
§ 10.41a(a)(2).
Sincerely,
Glen E. Vereb
Chief
Cargo Security, Carriers and Immigration Branch