BOR 7-07-4 CO:R:IT:C 113003 BEW
Mr. George C. Ballard
President
Olympic Container Corporation
11411 N.E. 124 Street
Kirkland, Washington 98034
RE: Entry of Empty Foreign Manufactured Containers as
Instruments of International Traffic; 19 U. S. C. 1322(a);
19 CFR 10.41(a); 19 CFR 113.66
Dear Mr. Ballard:
This is in reference to your letter of January 17, 1994,
concerning the release of containers which are instruments of
international traffic that are being manufactured by you in
Mexico and purchased by or leased to South Seas Steamship
Company, a U. S. company for use by carriers engaged in
international traffic.
FACTS:
You state (1) Olympic sells or leases intermodal cargo
containers that are made in Mexico to international Steamship
operators; (2) that you currently have some 50 units on lease at
your Mexican facility, and that you will be moving these units
empty to Los Angeles for South Seas through El Paso, Texas; (3)
that South Seas will load foreign bound cargo in the containers
at Los Angeles. You state that no intermediate domestic cargo
will be loaded during the trip from Mexico to Los Angeles. You
also state that Olympic plans to use its customs bond at El Paso,
Texas.
ISSUE:
Whether foreign manufactured intermodal cargo containers
which are sold and/or leased to U. S. companies to be used in
international traffic qualify for treatment as IIT when they
arrive containing merchandise and/or when they arrive empty to be
filled with merchandise to be exported foreign.
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LAW AND ANALYSIS:
Section 322(a), Tariff Act of 1930, as amended (19 U.S.C.
1322(a)), provides that "[v]ehicles and other instruments of
international traffic (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."
To qualify as an "IIT" within the meaning of section 322(a),
Tariff Act of 1930, as amended (19 U.S.C. 1322(a)), and the
regulations issued thereunder (19 CFR 10.41a et seq.), an article
must be substantial, suitable for and capable of repeated use,
and used in significant numbers in international traffic. The
Customs Regulations issued under the authority of section 322(a)
are in section 10.41a (19 CFR 10.41a). Paragraph (a)(1) 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.
Articles qualifying for treatment as IIT are considered to
be used in international traffic when they arrive containing
merchandise and when they arrive empty to be filled with
merchandise to be exported foreign. These IIT may be released
without entry or the payment of duty, subject to the provisions
of section 10.41a.
Under the provisions of section 10.41a(c) of the Customs
Regulations (19 CFR 10.41a(c)), an IIT will be released only
after a bond has been filed on Customs Form 301 containing the
bond conditions required under section 113.66 of the Customs
Regulations (19 CFR 113.66). Questions concerning bond
requirements may be directed to William Rosoff, Entry Rulings
Branch, 202-482-7040.
HOLDING:
The Mexican manufactured intermodal cargo containers which
Olympic sells and/or leases to South Seas to be used in
international traffic qualify for treatment as instruments of
international traffic when they arrive containing merchandise
and/or when they arrive empty to be filled with merchandise to be
exported foreign.
Sincerely,
Arthur P. Schifflin
Chief
Carrier Rulings Branch