Instruments of International Traffic; 19 U.S.C. § 1322(a); 19 C.F.R. §§ 10.41a(a)(1) and (3); Pallets; Accessories; SAF-D® components; subheading 9803.00.50, Harmonized Tariff Schedule of the United States Annotated (2011).

HQ H166738 August 16, 2011 BOR-4-07-OT:RR:BSTC:CCI H166738 LLB CATEGORY: Carriers Jeffrey A. Meeks, Esquire Meeks, Sheppard, Leo and Pillsbury 59 Stoney Hill Lane P.O. Box 129 West Tisbury, Massachusetts 02575 RE: Instruments of International Traffic; 19 U.S.C. § 1322(a); 19 C.F.R. §§ 10.41a(a)(1) and (3); Pallets; Accessories; SAF-D® components; subheading 9803.00.50, Harmonized Tariff Schedule of the United States Annotated (2011). Dear Mr. Meeks: This is in response to your May 2, 2011, letter, which this office received on May 17, 2011, on behalf of your client, Global Fresh Foods. In your letter, you request a ruling concerning whether SAF-D® system service modules, as described below, qualify as accessories to instruments of international traffic (IIT) under 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a(a)(3). Our decision follows. FACTS The following facts are from your May 2, 2011, letter and your May 24, and June 1, 2011, electronic mail to this office. The SAF-D® system service module is a reusable packaging architecture used for the application of a controlled atmosphere, e.g. creating an ultra-low oxygen environment, for the transport of fresh seafood. The system, which is manufactured in the United States, consists of a “blue box” fuel cell, the hydrogen bladder with assembled valves, additional reusable valves and vent assemblies, and external data loggers. The blue box casing is .090 inch thick copolymer resin; the hydrogen bladder is made with a 5.3 mil. laminated nylon/foil/poly barrier film with a burst property of 70 psi; the valve and vent assemblies are made of polypropylene; and the external data logger is made of polycarbonate.
The SAF-D® system components are affixed to U.S.-manufactured pallets by fish processors in Europe in preparation for shipment of fish to the U.S. Once the shipment arrives in the U.S., the SAF-D® components are removed and returned to the the fish processors in Europe. The pallets are not returned to Europe and remain loaded with the imported fish until the fish have been delivered to a retail location within the U.S. ISSUE Whether the SAF-D® system, may receive treatment as an instrument of international traffic under 19 U.S.C. § 1322(a)(1999) and 19 C.F.R. § 10.41a(a)(1). LAW AND ANALYSIS Although you assert that the SAF-D® system components qualify as accessories to IITs pursuant to 19 C.F.R. § 10.41a(a)(3), the facts of your case raise whether these components, when fully assembled, qualify as an IIT itself pursuant to 19 C.F.R. § 10.41a(a)(1). Subheading 9803.50.00, 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 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 Customs and Border Protection (CBP) regulations promulgated under the authority of 19 U.S.C. § 1322(a) provide 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 shipment of merchandise in international traffic are hereby designated as "instruments of international traffic" within the meaning of section 322(a), Tariff Act of 1930, as amended. The Commissioner of Customs [now CBP] is authorized to designate as instruments of international traffic, in decisions to be published in the weekly Customs Bulletin, such additional articles or classes of articles as he shall find should be so designated. Such instruments may be released without entry or the payment of duty, subject to the provisions of this section. 19 C.F.R. § 10.41a(a)(1)(emphasis added). To qualify for entry-free and duty-free treatment as instruments of international traffic 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 instruments of international traffic such additional articles not specifically noted in 19 C.F.R. § 10.41a(a)(1). CBP has held in its published decisions that in order 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(a)(1), an article must be substantial, suitable for and capable of repeated use, and used in significant numbers in international traffic. See 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). Upon reviewing your request and supporting documentation, we find that the SAF-D® system , as described above and as assembled, meet the requirements of an instrument of international traffic. In HQ 115108 (Aug. 24, 2000), this office held that certain parts, when assembled together formed shipping hampers. The shipping hampers were collapsible and all the parts that formed the shipping hampers were returned together to the United States. CBP held that the parts, when assembled together, were considered IITs pursuant to 19 C.F.R. § 10.41a(a)(1) insofar as the hamper system was substantial, suitable for and capable of repeated use, and used in significant numbers in international traffic. Similarly, the SAF-D® system, also a collapsible system, is substantial in that the blue box casing is .090 inch thick copolymer resin; the hydrogen bladder is made with a 5.3 mil. laminated nylon/foil/poly barrier film with a burst property of 70 psi; the valve and vent assemblies are made of polypropylene; and the external data logger is made of a durable polycarbonate. In addition, the system is suitable and capable of repeated use insofar as it can be used up to six times a year; and the system will be used in significant numbers in international traffic inasmuch as 600 of the systems will be used each year to transport fish and seafood from Europe to the United States. Based on the foregoing, the SAF-D® systems, when assembled, are instruments of international traffic; therefore, will qualify for entry-free and duty-free treatment as instruments of international traffic pursuant to 19 C.F.R. § 10.41a(a)(1). HOLDING The The SAF-D® system, when assembled, is an IIT within the meaning of 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a(a)(1). Accordingly, SAF-D® system, when assembled, will qualify for duty-free treatment under subheading 9803.00.50, HTSUS, and will not be subject to entry. Sincerely, George Frederick McCray Supervisory Attorney-Advisor/Chief Cargo Security, Carriers and Immigration Branch Office of International Trade, Regulations & Rulings