OT:RR:BSTC:CCR H350250 MF
Derrick Kyle, Esq.
Torres Trade Law
1717 K Street, NW
Washington, DC 20006
RE: Instruments of International Traffic; 19 U.S.C. § 1332(a); § 10.41a(a)(1), GPS Global
Pallet Services, LLC; Foldable Crates.
Dear Mr. Kyle:
This is in response to your July 8, 2025, ruling request on behalf of
GPS Global Pallet Services, LLC (“GPS”). In your request you inquire whether “foldable
crates” qualify as “instruments of international traffic” (“IIT”) within the meaning of 19 U.S.C. §
1332(a). Our decision follows.
FACTS:
The following facts are from your ruling request and supplements thereto. The subject
item is the GPS [ ] 1 model of “foldable crate.” GPS refers to the subject item as crates. Upon
review, the subject crates appear analogous to items that CBP has previously considered as
variants of pallets when analyzing their status as IITs. As discussed below, we examine the
subject merchandise in light of our prior treatment of pallet cubes.
1
You have asked this office for confidential treatment of bracketed information. CBP Regulations at 19 C.F.R. §
177.2(b)(7) provide that the requester of a ruling from our office may ask that privileged or confidential commercial
or financial information supplied for purposes of preparing the requested ruling not be disclosed. Such requests will
be considered if the information is clearly identified and the reasons for requesting that information not be disclosed
are provided. If this office receives a Freedom of Information Act request for your submission, regulations at 6
C.F.R. § 5.12, et seq., regarding the disclosure of business information provide that the submitter of business
information will be advised of receipt of a request for such information whenever the business submitter has in good
faith designated the information as commercially or financially sensitive information. We accept your request for
confidential treatment as a good faith request.
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The subject items are designed to transport synthetic and natural rubber bales through
international traffic and be returned empty to the United States from [ ] and [ ] for
distribution to GPS’s clients who will subsequently [ ]. GPS
intends to ensure the timely departure of their foldable crates by accounting for them on a
“volume basis” which will compare the exact number of foldable crates imported during a
twelve-month period with the exact number of cubes exported. GPS acknowledges that any item
retained domestically for more than 365 days must be entered with applicable duty paid.
The subject items are adapted to the lengths and widths of twenty-foot by forty-foot
ocean shipping containers to optimize loading and prevent any displacement during transport.
The foldable crates comprise a pallet-like base that can be manipulated by a forklift, and four
collapsible sides which when erected can lock into place and form a cube that is open with an
interior that is accessible from above. The subject items can be stacked atop each other in both
their collapsed and erected configuration.
With respect to the subject items, their frames are constructed of galvanized steel. The
dimensions of the subject items are as follows
• External: [ ]mm x [ ]mm x [ ]mm
• Internal: [ ]mm x [ ]mm x [ ]mm
• Collapsed: [ ]mm x [ ]mm x [ ]mm
The subject cubes are depicted below in their erected, collapsed, collapsed stacked, and erected
stacked states, respectively:
Foldable Crate with Sides Erected
2
Foldable Crate with Sides Collapsed
Foldable Crate with Sides Collapsed
Stacked
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Foldable Crate with Sides Erected Stacked
On Forklift
GPS states the cubes are used about 1.5 times per year. The average lifespan of the cubes is
around 16 years. Approximately [ ] of these cubes are currently in use. According to the
documents provided, the subject cubes in current circulation have been formally entered by GPS
under Subheading 8609.00.0000, HTSUS, with applicable duties paid. GPS USA has always
imported its foldable crates under 8609.00.0000 and paid the applicable duties. However, GPS
USA does not have visibility or control of how their customers import full foldable crates or
whether the customers treat the foldable crates as IITs upon importation.
ISSUE:
1. Whether the subject foldable crates qualify for consideration as IIT within the meaning of
19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a(a)(1).
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LAW AND ANALYSIS:
Per 19 C.F.R. § 141.4(a), “all merchandise imported into the United States is required to
be entered, unless specifically excepted.” The four exceptions to the requirement of entry are
listed under 19 C.F.R. § 141.4(b), one of which is instruments of international traffic. See 19
C.F.R. § 141.4(b)(3).
Subheading 9803.00.0, HTSUS provides for the duty-free treatment of:
Substantial containers and holders, if products of the United States (including
shooks and staves of United States production when returned as boxes or barrels
containing merchandise), or if of foreign production and previously imported and
duty (if any) thereon paid, or if of a class specified by the Secretary of the Treasury 2
as instruments of international traffic, repair components for containers of foreign
production which are instruments of international traffic, and accessories and
equipment for such containers, whether the accessories and equipment are imported
with a container to be reexported separately or with another container, or imported
separately to be reexported with a container.
(Footnote and emphasis added).
Subchapter 98 of the HTSUS only applies to:
(a) Substantial containers or holders which are subject to tariff treatment as
imported articles and are:
(i) Imported empty and not within the purview of a provision which
specifically exempts them from duty; or
(ii) Imported containing or holding articles, and which are not of a kind
normally sold therewith or are entered separately therefrom; and
(b) Certain repair components, accessories and equipment.
See U.S. Note 1, et seq., Chapter 98, HTSUS.
Pursuant to 19 U.S.C. § 1322(a), 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. The
relevant CBP regulations implementing that statute are found at 19 C.F.R. § 10.41a(a)(1) which
provides in pertinent part:
Lift vans, cargo vans, shipping tanks, skids, pallets, caul boards, and cores for
textile fabrics, arriving (whether loaded or empty) in use or to be used in the
2
Customs revenue functions have been delegated to the Secretary of Homeland Security by the Secretary of
Treasury, with exceptions herein not applicable, under the authority of the Homeland Security Act of 2002, Pub. L.
107-296. See Treas. Dep't Order 100-16 (May 15, 2003).
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shipment of merchandise in international traffic are hereby designated as
“instruments of international traffic” [. . .] The Commissioner of Customs [now
CBP] is authorized to designate as instruments of international traffic […] such
additional articles or classes of articles as he shall find should be so designated.
19 C.F.R. § 10.41a(a)(1) (emphasis added).
Such instruments may be released without entry or the payment of duty, subject to the provisions
of this section.
To qualify for entry-free and duty-free treatment as IITs under the aforementioned
statutory and regulatory authority, the article must be a substantial container or holder. As stated
above, CBP is authorized to designate as an IIT such additional articles not specifically noted in
19 C.F.R. § 10.41a(a)(1). To qualify as an IIT within the meaning of 19 U.S.C. § 1322(a) and 19
C.F.R. § 10.41a(a)(1), an article used as a container or holder must be: (1) substantial, (2)
suitable for and capable of repeated use, and (3) used in significant numbers in international
traffic. See HQ H291037 (Jan. 9, 2018); HQ H016491 (Oct. 1, 2007); HQ 114150 (Dec. 12,
1997); HQ 107545 (May 7, 1985); Treas. Dec. 71-159, Cust. B. & Dec. 296 (June 18, 1971); 99
Treas. Dec. 533, No. 56247 (Aug. 26, 1964). 3
Pursuant to 19 C.F.R. § 10.41a(a)(1), pallets are per se IITs. In HQ H119060 (Nov. 9,
2020), CBP held that “pallets have already been designated as an instrument of international
traffic by regulation. See 19 C.F.R. § 10.41a(a).” HQ H119060 (Nov. 9, 2010); see also HQ
H252710 (May 19, 2014) (CBP held “the subject plastic pallets are IITs Pallets have already
been designated as an instrument of international traffic by regulation. See 19 C.F.R. § 10.41a(a).
In CBP Ruling HQ 345809 (May 30, 2025), we found that stackable cubes with a pallet
base capable of manipulation by forklift, and four collapsible posts which locked into place to
aid in securing transported merchandise were pallets eligible for treatment as IITs. The items
under consideration are collapsible and stackable galvanized steel foldable crates analogous to
pallet cubes, comprised of collapsible sides and a pallet foundation. The sides are designed to
lock into place. Due to the high degree of similarity between the subject items and those at issue
in HQ 345809, we shall also treat these items as pallets.
We have previously confirmed the IIT status of articles of similar materials and
construction in a number of rulings other than HQ 345809. In CBP Ruling HQ H025196 (May
15, 2008), citing CBP Ruling HQ 116575 (Jan. 26, 2006), we held that pallet boxes made of steel
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The requirement that an article be “substantial” is not only a threshold requirement under 9803.00.50, but also a
requirement for an article to be an instrument of international traffic pursuant to CBP decisions. The origin for the
criterion found in CBP decisions that an article be “substantial” is found in Schedule 8, Item 808.00 of the Tariff
Schedule of the United States (1963)(TSUS), the predecessor provision to 9803.00.50, HTSUS. Likewise, the
criterion that an article be “suitable for and capable of repeated use” is found in Schedule 8, Item 808.00, TSUS,
Headnote 6(b)(ii)(stating that the article must be capable of “reuse”). Although the requirement that an article be
capable of reuse is no longer under subheading 9803.00.50, HTSUS (the successor provision to Item 808.00, TSUS),
to receive duty-free treatment thereunder nevertheless, “reuse” is still required, pursuant to CBP decisions, for an
article to be considered an instrument of international traffic.
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are IITs. In CBP Ruling HQ 116047 (Dec. 1, 2003), we also held that collapsible steel racks that
hold automobile transmissions within ocean containers are IITs.
Upon review of the submission and information provided, we find the subject foldable
crates are containers that are substantial, suitable for and capable of repeated use, and used in
significant numbers in international traffic. They are substantial in that they are made of steel 4
and have an average lifespan of 16 years. They are used in significant numbers in international
commerce, given that approximately [ ] of these foldable crates are currently in use in
international traffic. Lastly, the subject pallet cubes are suitable for and capable of reuse given
that these units are used approximately 1.5 times in a 12-month period.
Based on the foregoing, the foldable crates are eligible for designation as IITs; and
therefore qualify for entry-free and duty-free treatment as IITs pursuant to 19 C.F.R. §
10.41a(a)(1). While when originally imported, the subject foldable crates underwent normal
entry process and the payment of applicable duties, their subsequent use as instrumentalities of
international traffic during the transportation of synthetic and natural rubber bales is dispositive
of their status. Therefore, these foldable crates, used as such by GPS’s customers, are eligible
for designation as IITs per se; and would therefore qualify for entry-free and duty-free treatment
as IITs pursuant to 19 C.F.R. § 10.41a(a)(1).
However, if these foldable crates were formally entered by GPS’s customers with
applicable duties paid, upon eventual reimportation, these foldable crates would qualify for duty-
free treatment under Subheading 9803.00.50, HTSUS, not as IITs per se, but as “of foreign
production and previously imported and duty paid” substantial holders.
HOLDING:
Subject foldable crates that have been used by GPS’s customers for purposes of
international traffic and have not yet formally entered by the United States qualify for treatment
as instruments of international trade within the meaning of 19 U.S.C. § 1322(a) and §
10.41a(a)(1). However, those foldable crates which have previously been imported, entered and
for which duties were paid by GPS’s customers should be entered under Subheading 9803.00.50,
HTSUS as “Articles, previously imported.”
Please note that 19 C.F.R. § 177.9(b)(1) provides that “[e]ach ruling letter is issued on the
assumption that all of the information furnished in connection with the ruling request and
incorporated in the ruling letter, either directly, by reference, or by implication, is accurate and
complete in every material respect. The application of a ruling letter by a {CBP} field office to
the transaction to which it is purported to relate is subject to the verification of the facts
incorporated in the ruling letter, a comparison of the transaction described therein to the actual
transaction, and the satisfaction of any conditions on which the ruling was based.” If the terms
of the import or export contracts and results of the sampling records vary from the facts
4
See HQ 114733 (Nov. 17, 1999); H116376 (Jan. 11, 2005) (CBP determined steel bins and steel chains were
substantial); HQ 303170 (Apr. 9, 2019) (CBP held steel container racks were substantial); and H339996 (October
11, 2024) (CBP found that steel cargo support structures were substantial).
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stipulated to herein, or CBP ascertains discrepancies based upon a review of any other pertinent
information, this decision shall not be binding on CBP as provided for in 19 C.F.R. § 177(b)(1),
(2) and (4), and § 177.9(b)(1) and (2).
Sincerely,
W. Richmond Beevers, Chief,
Cargo Security, Carriers, and Restricted
Merchandise Branch
Office of Trade, Regulations & Rulings
U.S. Customs and Border Protection
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