BOR-7-07-CO:R:IT:P 111429 BEW
Thomas C. Binger
Connell Bros. Company, Ltd.
320 California Street
San Francisco, California 94104
RE: Eligibility of certain polypropylene bags to be designated
as instruments of international traffic (IIT)
Dear Mr. Binger:
This is in reference to your letters dated November 29,
1990 and March 3, 1991, requesting that certain polypropylene
"Mini Bags" be designated as instruments of international traffic
(IIT).
FACTS:
You state that you anticipating using approximately 500 to
3,500 polypropylene bags monthly into the United States. You
state that the large size of the bags and their sturdy
construction allows them to be used five (5) or (6) times before
they will be destroyed. You state that the bags are made of
heavy duty polypropylene fabric, and that the bags are filled and
emptied via a reclosable spout. You state that because of this
type of closure, the bags do not have to be cut nor have their
structural integrity damaged in any way upon filling or
discharging of the kaolin clay. You state that the bags are
multistrip bags and, therefore are stronger than the normal
polypropylene bag. You state that the polypropylene bags will be
used to transport dry Kaolin clay and will hold one metric ton.
You state that the port of entry and departure will be Savannah,
Georgia, but could include Oakland, California, Baltimore,
Maryland, Charleston, South Carolina, and New Jersey.
ISSUE:
Whether the heavy duty polypropylene bags used for the
transportation of dry Kaolin clay may be designated as
instruments of international traffic within the meaning of 19
U.S.C. 1322(a) and section 10.41a, Customs Regulations.
LAW AND ANALYSIS:
Section 322(a), Tariff Act of 1930, as amended (19 U.S.C.
1322(a)), provides that "[v]ehicles and other IIT, of any class
specified by the Secretary of the Treasury, shall be granted the
customary exceptions from the application of the customs laws to
the extent and subject to such terms and conditions as may be
prescribed in regulations or instructions of the Secretary of the
Treasury."
The Customs Regulations issued under the authority of
section 322(a) are in section 10.41a (19 CFR 10.41a). Paragraph
(a)(l) of section 10.41a designates as IIT lift vans, cargo vans,
shipping tanks and certain other named articles and states that
other articles may be designated as IIT by the Commissioner of
Customs in decisions to be published in the weekly Customs
Bulletin. Once designated as instruments of international
traffic, these items may be released without entry or the payment
of duty, subject to the provisions of section 10.41a.
To qualify as an "instrument of international traffic"
within the meaning of 19 U.S.C. 1322(a) and the regulation
promulgated pursuant thereto (19 CFR 10.41a 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
Schedules of the United States (HTSUS), 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 Holly Stores, supra, the court determined that "reuse" in
the context of former General Headnote 6(b)(ii) "has been
consistently interpreted to mean practical, commercial reuse, not
incidental reuse." (Emphasis added). In that case, articles of
clothing were shipped into this country on wire or plastic coat
hangers. Evidence showed that the hangers were designed to be,
and were of fairly durable construction and that it would be
physically possible to reuse them. However, the court found that
only about one percent of the hangers were reused in any way at
all, and that those uses were of a noncommercial nature. The
court held that the uses of these hangers beyond shipping them
once from overseas to the United States were purely incidental,
and concluded that the hangers were "not designed for, or
capable of, reuse". Subsequent Customs rulings on this matter
have held that single use is not sufficient; reuse means more
than twice (Headquarter rulings 105567 and 108658). Furthermore,
it is our position that the burden of proof to establish reuse is
on the applicant, even though the applicant may not be the party
reusing the instrument.
We find that the bags under consideration are woven heavy
duty polypropylene bags capable of being used as a container or
holder, that they are substantial, suitable for and capable of
repeated use, and that they will be used in significant numbers
in international traffic. We further find that the woven
polypropylene bags under consideration are similar to woven
polypropylene bags which were designated as instruments of
international traffic in Treasury Decision 76-171 (woven
polypropylene bags, and used for the transportation of dry
chemicals), and Treasury Decision 68-4 (collapsible nylon
container capable of holding zinc dust or similar material).
The designation of a container or holder as an IIT becomes
effective only when used as such upon its arrival in this country
in foreign trade, either empty or with merchandise. If the
holder or container is brought into the country by a party other
than the one who is using it as an IIT, it is subject to entry as
imported merchandise. The principal on the IIT bond is the party
who is using the holder or container as an IIT.
HOLDING:
The heavy duty polypropylene bags under consideration
qualify for treatment as instruments of international traffic and
may be released under the procedures set forth in section 10.41a,
Customs Regulations.
Sincerely,
B. James Fritz
Chief
Carrier Rulings Branch