Instruments of International Traffic; 19 U.S.C. § 1322(a); 19 C.F.R. §§ 10.41a(a)(1); HTSUS subheading 9803.00.50; Robert Bosch, LLC; containers and lid assemblies

U.S. Department of Homeland Security Washington, DC 20229 U.S. Customs and Border Protection HQ H319515 August 23, 2021 BOR-07-OT:RR:BSTC:CCR H319515 JLE CATEGORY: Carriers Alma Arabelovic Director, Foreign Trade Robert Bosch LLC Oakbrook Terrace Tower 1 Tower Lane, Suite 3100 Oakbrook Terrace, IL 60181 RE: Instruments of International Traffic; 19 U.S.C. § 1322(a); 19 C.F.R. §§ 10.41a(a)(1); HTSUS subheading 9803.00.50; Robert Bosch, LLC; containers and lid assemblies Dear Ms. Arabelovic: This is in response to your June 28, 2021, ruling request on behalf of Robert Bosch, LLC. In your submission, you request a ruling concerning whether certain container and lid assemblies qualify as substantial containers and therefore, may be classified under subheading 9803.00.50 of the Harmonized Tariff Schedule of the United States (HTSUS). Our decision follows. FACTS The following facts are from your June 28, 2021, ruling request and your July 12, 2021, email. The subject items are sets of containers and lids that are primarily used for the transportation of various automotive and electrical components, such as coils, housings and connectors, between the United States and Mexico. Bosch owns and uses these items, which are made of durable plastic and come in various sizes. These containers are injection-molded, straight-wall, square or rectangular plastic cubes that consist of a base and four walls and are assembled according to the needs and size of the goods they are used to ship. They are manufactured in Germany. The subject containers and lids hold the automotive and electrical components in place while they are being transported. These containers and their accessories come in various combinations of containers, lids, tops, sleeves, trays and dividers. The lids and tops are injection molded detached lids and covers, and are made from HDPE or PP. They range in size from 15 inches by 12 inches by one inch to 48 inches by 45 inches by three inches. The plastic pallets are structural foam molded or injection molded and are made of HDPE. They have a working capacity up to 4000 pounds and range in size from 48 inches by 32 inches by four inches to 48 inches by 45 inches by six inches. The trays are thermoformed or injection molded plastic trays that are made of HIPS, ABS or EPP. They range in size from 13 inches by nine inches by one inch to 24 inches by 16 inches by five inches. They range in thickness from 0.06 inches to 0.1 inch. The dividers are plastic partitions that are made of PP. They range in size from 13 inches by nine inches by five inches to 24 inches by 16 inches by 11 inches. Bosch’s personnel prepare the electrical components for shipping by placing them into the subject containers. The containers are then moved onto pallets at the facility’s loading dock and onto a truck or trailer for transportation. These assemblies are transported and warehoused by metal pallets and metal dollies. The pallets have a working load up to 2200 pounds and are 1210 millimeters by 800 millimeters by 120 millimeters. The dollies contain four swivel wheels and are designed to carry the plastic containers and trays at issue. These metal dollies are 24 inches by 16 inches by 6.5 inches. The subject containers and lids are reused 11 times a year, and their average lifespan is three to five years. Regarding the assembled containers and lids, there are 727 in circulation of the kind that contain the metal adapter, top cap container and dollies, and there are 289 in circulation of the type that contain the plastic pallet, top cap, container and lids. Regarding the assemblies that are only containers and lids, there are 1156 of them in circulation. Each item is assigned a unique part number that is not interchangeable. Bosch uses these numbers track each item via its inventory management system. When these items arrive in the U.S., they are sent to a Bosch plant such as in Charleston, South Carolina to be filled and exported back to the Bosch plant in Mexico. The following are images of the subject containers and lids, taken from your June 28, 2021 ruling request.
ISSUE Whether the subject containers and lids are IITs within the meaning of 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a(a)(1). 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. 19 C.F.R. § 141.4(b)(3). Subheading 9803.00.50, 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 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 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). IITs 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). The subject items are containers insofar as they are three dimensional and are used to hold and transport merchandise. They are also substantial inasmuch they are made of various types of durable plastic. They also have a life expectancy of three to five years. In addition, these items are suitable for and capable of reuse, in that they are reused eleven times a year. 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; Holly Stores, Inc. v. United States, 697 F.2d 1387 (Fed. Cir. 1982). In addition, there are 727 assembled lids and containers in circulation of the kind that contain the metal adapter, top cap container and dollies, and there are 289 in circulation of the type that contain the plastic pallet, top cap, container and lids. There are 1156 in circulation of the assemblies just containers with lids. Prior CBP rulings have determined that similar containers and lids are IITs. In HQ H303878 (July 11, 2019), for example, CBP classified hard plastic totes, lids, partitions, and pallets that were used for international shipping of automobile parts as IITs because they held and contained the merchandise they shipped, were reused 36 times a year, had a lifespan of seven years, and had sufficient numbers in circulation in that there were 750 of them in circulation. In addition, in HQ H285811 (Aug. 14, 2017), CBP classified various plastic boxes, bins, and a shipping system composed of trays, sleeves, and plastic pallets used to ship automotive components, steering systems, and bearings as IITs. In that case, the items at issue held and contained the merchandise they shipped, and CBP specifically found that they were made of sufficiently durable plastic to be considered substantial. In addition, they were suitable for and capable of repeated use, with a lifespan of three to five years and a use of four to five times a year. Furthermore, they were used in significant numbers in international traffic. Similarly, the subject containers and lids are used to hold and transport automotive and electrical components. In addition, these items are substantial in that they are made of durable plastic and have a life expectancy of three to five years. They are capable and suitable of reuse in that they are reused eleven times a year. Lastly, there are sufficient numbers of them in circulation in that there are between 289 and 1156 of the various types of these containers in circulation. As such, we find that the subject containers and lids are IITs. HOLDING The subject containers and lid assemblies are IITs within the meaning of 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a(a)(1). Sincerely, Richmond W. Beevers Chief, Cargo Security, Carriers and Restricted Merchandise Branch Office of Trade, Regulations and Rulings U.S. Customs and Border Protection