BOR-4-07-OT:RR:BSTC:CCI H080177 JLB
Ms. Cynthia Frazee
Manager, Transportation and Customs Compliance
Boehringer-Ingelheim Roxane Inc.
1801 Wilson Rd.
Columbus, Ohio 43228
RE: Instruments of International Traffic; Accessories; Equipment; Sendum PT200 tracking device; 19 U.S.C. § 1322(a); 19 C.F.R. § 10.41a
Dear Ms. Frazee:
This is in response to your correspondence of October 9, 2009, in which you requested a ruling that the Sendum PT200 Covert Global Positioning System (“GPS”) tracking devices are instruments of international traffic pursuant to 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a. Our ruling on your request follows.
FACTS
The Sendum PT200 is a battery powered, portable convert GPS tracking device that is enabled by cellular signaling technology. It has a hard plastic, water resistant enclosure which houses a rechargeable battery for repetitive use. The durable nature of the product means that its life span is approximately five (5) years. The device, uniquely identified by individual serial numbers, is manufactured in British Columbia, Canada and can be utilized in all modes of transportation – air, ocean, truck and rail.
Boehringer Ingelheim Roxane Inc. (BIRI), located in Columbus, Ohio, is a pharmaceutical manufacturer whose products are distributed both domestically and internationally. BIRI participates in and is compliant with the security protocols of the C-TPAT program to provide a safe and secure transportation network for its customers due to the volatile nature and high value of the products transported. As a result of their participation in the C-TPAT program and as an additional layer of security, BIRI purchased a number of Sendum PT200 tracking devices for use in tracking and tracing inbound and outbound shipments, both domestic and international.
The international parameters of the program include tracking capabilities for all imported trailers originating at BIRI’s related affiliate company, Boehringer Ingelheim Promeco (BI Promeco) in Mexico City. The anticipated volume of shipments from Mexico City to Columbus, Ohio is approximately two hundred (200) annually. During the stuffing of the trailer, the device will be covertly placed within the cargo to enable tracking. Throughout the entire conveyance, the device emits a “signal” indicating the exact location of the shipment via cellular phone technology. This way BIRI is able to, technologically, visualize the shipment as it moves from origin to destination. Once the trailer arrives safely at its destination, the tracking device is removed and placed in another trailer to be used in international traffic.
BIRI is currently utilizing only two (2) motor carriers to transport products in trailers from Mexico City to Columbus, Ohio. With the volume of shipments coming across the border, both BI Promeco and BIRI may utilize the same trailer for repeated trips across the border en route to Columbus, Ohio. Trailers tendered from Mexico City will be the first from international locations to be included in the in-transit security program. Future international locations to be incorporated will be Germany and Italy.
ISSUE
Whether the Sendum PT200 GPS tracking devices described above qualify as instruments of international traffic within the meaning of 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a?
LAW AND ANALYSIS
Pursuant to 19 U.S.C. § 1322(a), “vehicles and other instruments of international traffic, of any class specified by the Secretary of [Homeland Security], 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…” Lift vans, cargo vans, shipping tanks, skids, pallets, caul boards, and cores for textile fabrics are explicitly classified as “instruments of international traffic.” 19 C.F.R. § 10.41a(a)(1). Additionally, the Commissioner of U.S. Customs and Border Protection (“CBP”) is authorized to designate other items besides those mentioned as “instruments of international traffic.” This includes “the normal accessories and equipment imported with any such instrument which is a container as defined in Article 1 of the Customs Convention on Containers.” 19 C.F.R. § 10.41a(a)(3). Once designated as such, the instruments may be released without entry or payment of duty.
To qualify as an “instrument of international traffic” within the meaning of 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a, 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 Headquarters Ruling Letter 109665, dated September 12, 1988; Headquarters Ruling Letter 109634, dated August 11, 1988; see also Headquarters Ruling Letter 113687, dated February 27, 1997. The concept of reuse contemplated above is for commercial shipping or transportation purposes, and not incidental or fugitive uses. See Tariff Classification Study, Sixth Supplemental Report (May 23, 1963) at 99; see also Holly Stores, Inc. v. United States, 697 F.2d 1387, 1388 (Federal Cir., 1982). Reuse has been held to mean using the containers more than twice. See Headquarters Ruling Letter 116032, dated October 30, 2003; Headquarters Ruling Letter 116391, dated February 16, 2005; Headquarters Ruling Letter 115754, dated August 19, 2002.
With regard to the trailers in which the Sendum PT200 tracking devices will be placed, it is well settled that truck trailers transporting international merchandise qualify as “instruments of international traffic.” See 19 C.F.R. §§ 10.41(a), 123.14(a). Accordingly, these trailers may be released without entry or payment of duty.
With respect to the Sendum PT200 tracking devices themselves, which are not containers, we note that accessories and equipment for instruments of international traffic containers are addressed in 19 C.F.R. § 10.41a(a)(3) which provides:
“As used in this section, ‘instruments of international traffic’ includes the normal accessories and equipment imported with any such instrument which is a ‘container’ as defined in Article 1 of the Customs Convention on Containers.”
The Customs Convention on Containers defines the term “container” as an:
…..article of transport equipment (lift-van, movable tank or other similar structure):
(i) fully or partially enclosed to constitute a compartment intended for containing goods;
(ii) of a permanent character and accordingly strong enough to be suitable for repeated use;
(iii) specially designed to facilitate the carriage of goods, by one or more modes of transport, without intermediate reloading;
(iv) designed for ready handling, particularly when being transferred from one mode of transport to another;
(v) designed to be easy to fill and to empty; and
(vi) having an internal volume of one cubic metre or more;
the term “container” shall include the accessories and equipment of the container, appropriate for the type concerned, provided that such accessories and equipment are carried with the container. The term “container” shall not include vehicles, accessories or spare parts of vehicles, or packaging. Demountable bodies, are to be treated as containers;
Customs Convention on Containers, 1972, Ch. 1, Art. 1(c), et seq.
It is readily apparent that the trailers in question qualify as “containers” as defined in the Customs Convention on Containers. The trailers are enclosed, of a permanent character, designed to facilitate the carriage of goods and ready handling of such goods, designed to be easily filled and emptied and have an internal volume of one cubic metre or more. Consequently, the provisions of 19 C.F.R. § 10.41a(a)(3) are applicable in this case.
In determining whether the Sendum PT200 tracking device is an accessory or equipment for an instrument of international traffic pursuant to 19 C.F.R. § 10.41a(a)(3) and therefore entitled to treatment under 19 C.F.R. § 10.41a(a)(1), the following factors must be met: the product must be substantial; suitable for and capable of repeated use with containers that are instruments of international traffic; used in significant numbers in international traffic; and imported with containers that qualify as instruments of international traffic. See, e.g., Headquarters Ruling Letter H004789, dated January 12, 2007; Headquarters Ruling Letter W116719, dated November 30, 2006; Headquarters Ruling Letter 116288, dated August 12, 2004.
Upon reviewing the request, the Sendum PT200 tracking device is substantial, suitable for and capable of repeated use with the trailers, and used in significant numbers in international traffic. The Sendum PT200 tracking device is rugged, portable and imported with the subject intermodal cargo containers. Once a trailer arrives safely at its destination, the tracking device is removed and re-installed in another trailer in international traffic. Additionally, the device is suitable and capable of repeated use with such containers that are instruments of international traffic given that their average life span is five (5) years. Along the Mexico-United States border, BIRI averages approximately two hundred (200) shipments annually; therefore, the Sendum PT200 tracking device is used in significant numbers in international traffic.
In the present case, we find that the Sendum PT200 tracking devices are accessories or equipment of cargo containers that are instruments of international traffic. We note CBP previously concluded tracking devices such as acceleration-measuring devices, container security units, and tamper-resistant embedded controllers constitute accessories or equipment within the meaning of 19 C.F.R. § 10.41a(a)(3). See Headquarters Ruling Letter H005096, dated March 12, 2007 (a Tamper-Resistant Embedded Controller (“TREC”), which is an enhanced container-security, monitoring and tracking device that is mounted in intermodal containers to collect and report data such as the status, condition and location of the container and its contents, may not be designated as an “instrument of international traffic” under 19 C.F.R. § 10.41a(a)(1) in and of itself because it is not a substantial container or holder of merchandise but it may be designated an accessory to an instrument of international traffic container under 19 C.F.R. § 10.41a(a)(3) and thereby entitled to treatment as such under 19 C.F.R. § 10.41a(a)(1)); Headquarters Ruling Letter H016914, dated December 11, 2007 (tracking devices affixed to intermodal flat racks to import low-enriched uranium from Europe to the United States are accessories to instruments of international traffic); see also Headquarters Ruling Letter 116684, dated August 17, 2006 (tamper-resistant embedded controllers are accessories or equipment to intermodal cargo containers and qualify as “instruments of international traffic”); Headquarters Ruling Letter 116575, dated January 26, 2006 (shock/climate measuring devices were designated accessories of instruments of international traffic for intermodal containers given that they were designed for and will be used with the containers).
Accordingly, as discussed above, the Sendum PT200 tracking devices constitute accessories or equipment of instruments of international traffic pursuant to 19 C.F.R. § 10.41a(a)(3) and are therefore designated as instruments of international traffic pursuant to 19 C.F.R. § 10.41a(a)(1). In those instances where the subject tracking devices are imported separately from the containers, entry of the devices, together with a declaration of intent to this effect, would be required in accordance with 19 C.F.R. § 10.41a(a)(2).
HOLDINGS
The Sendum PT200 tracking devices described above qualify as “instruments of international traffic” within the meaning of 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a.
Sincerely,
Glen E. Vereb, Chief
Cargo Security, Carriers and Immigration Branch