BOR-4-07-OT:RR:BSTC:CCR H266222 WRB
Mr. Matthew Clark
Director, Import Services
SEKO Customs Brokerage, Inc.
1100 Arlington Heights Road
Itasca, IL 60143
RE: Instruments of International Traffic; Gamesa Wind US, LLC; 19 U.S.C. § 1322(a); 19 C.F.R. § 10.41a.
Dear Mr. Clark:
This is in response to your June 12, 2015, ruling request on behalf of your client, Gamesa Wind US, LLC, In your request you inquire whether certain wind turbine hub platform stands qualify as “instruments of international traffic” within the meaning of 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a. Our ruling is set forth below.
FACTS
The following facts are from your ruling request and supplements thereto. Gamesa Wind US, LLC, (Gamesa) imports wind turbines. Wind turbines are imported disassembled due to the weights and dimensions of the individual components, are composed of the tower, the nacelle, the hub and the blades.
The hub component is shipped individually on a hub platform stand. The hub is mounted and secured on the hub platform stand. The hub platform stands are made of heavy-duty, welded steel, with welded or bolted joints and connections, specifically for transport of the hub. The typical life-cycle of a hub platform stand is estimated to be in excess of 10 years unless it sustains significant unrepairable damage. Gamesa estimates that there are approximately 1300 hub platform stands in use, each with its own set of accessories, consisting of a set of bolts, nuts, and washers for securing the hub to the hub stand and a canvas shipping cover. Most hub platform stands are serialized, and Gamesa in the process of serializing the remainder. Serial number data will be noted on shipping documents in the future.
Once imported, the hub platform stand is used to transport and hold the hub until it is installed on the turbine unit at various locations in the United States, including, but not limited to, Ohio, North Carolina, New York, and West Virginia. The port of arrival varies depending on the location of the wind farm. Upon unloading, the hub platform stand is exported to the manufacturer where it is re-used to transport more hubs. The hub platform stands are depicted in the photographs below, provided by Gamesa.
ISSUE
Whether the hub platform stands described above qualify as “instruments of international traffic” within the meaning of 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a?
LAW AND ANALYSIS
Gamesa asserts that the subject hub platform stands may be classified under subheading 9803.00.50, Harmonized Tariff Schedule of the United States (HTSUS) because they qualify as IITs.
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 Customs and Border Protection (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. 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 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). Historically, CBP has held in its published decisions that in order 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 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). See also HQ H188300 (Jan. 6, 2012)(engine transportation stands for transportation of aircraft jet engines).
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.
You assert that the subject articles are instruments of international traffic. Pursuant to 19 U.S.C. § 1322(a), instruments of international traffic 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” . . . 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. 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).
Upon reviewing the present matter, based on the information provided by Gamesa, the requisite criteria for designation of the subject hub platform stands as instruments of international traffic have been met. As concerns the hub platform stands described in the FACTS section above, they are substantial inasmuch as they are made of heavy-duty, welded steel, with welded or bolted joints and connections. Further, they are suitable for and capable of repeated use as they have a useful life in excess of 10 years and will be used up to 157 times annually. They are used in significant numbers in international traffic insofar as the current inventory of such hub platform stands numbers in excess of 1300. Based on the foregoing, the hub platform stands described in the FACTS section above are IITs; therefore, they qualify for entry-free and duty-free treatment as IITs pursuant to 19 C.F.R. § 10.41a(a)(1) and 9803.00.50, HTSUS.
With regard to the sets of bolts, nuts, and washers used for securing the hub to the hub stand and the canvas shipping covers, these items are not vehicles such as a lift vans, cargo vans, or shipping tanks, nor are they containers or holders. You state that these items arrive with the hub platform stands and that they are used to secure the rotors to the stands and to cover and protect the hubs during transport. When not in use, these items are crated and returned with the hub platform stands to the manufacturer. These items do not actually serve as holders or containers. Rather, these items are placed onto the hub platform stand to enable them to perform the function of carrying the rotors. Accordingly, these items are best understood as accessories to the hub platform stands, rather than holders or containers themselves.
Title 19 Code of Federal Regulations § 10.41a provides, in pertinent part:
Repair components, accessories, and equipment for any container of foreign production which is an instrument of international traffic may be entered or withdrawn from warehouse for consumption without the deposit of duty if the person making the entry or withdrawal from warehouse files a declaration that the repair component was imported
to be used in the repair of a container of foreign production which is
an instrument of international traffic, or that the accessory or equipment is
for a container of foreign production which is an instrument of international traffic. The port director must be satisfied that the importer of the repair component, accessory, or equipment had the declared intention at the time of importation.
19 C.F.R. § 10.41a(a)(2).
In previous determinations, CBP has ruled that certain articles of similar nature, use and construction as those presently under consideration qualify as accessories to instruments of international traffic within the meaning of 19 C.F.R. § 10.41a(a)(2). In HQ 116573 (Dec. 19, 2005), certain acrylic inserts used to secure glass plates within aluminum carrying cases were designated as accessories of instruments of international traffic within the meaning of 19 C.F.R. § 10.41a(a)(2). Also, in HQ H162376 (July 20, 2011), we ruled that certain straps with ratchet closures used to secure packing frames and dollies to truck parts qualified as accessories of instruments of international traffic within the meaning of 19 C.F.R. § 10.41a(a)(2). Similarly, in HQ H044815 (Dec. 18, 2008), CBP ruled that certain packing items used to secure pipework and centrifuge parts for machines used in the process of enriching uranium within aluminum shipping boxes qualified as accessories of IITs. Also, in HQ H161055 (June 27, 2011), CBP determined that certain reusable tarps with chimneys used as covers for the open-top ocean containers, qualified as accessories of instruments of international traffic within the meaning of 19 C.F.R. § 10.41a(a)(2). Based on all the foregoing, the sets of bolts, nuts, and washers used for securing the hub to the hub stand and the canvas shipping covers meet the requirements for designation as accessories to instruments of international traffic within the meaning of 19 C.F.R. § 10.41a(a)(2).
HOLDING
The subject hub platform stands, described in the FACTS section above, are IITs within the meaning of 19 U.S.C. § 1322(a) and 19 C.F.R. § 10.41a(a)(1). The nut, bolt, and washer sets, and the canvas shipping covers, described in the FACTS section above are accessories of instruments of international traffic within the meaning of 19 C.F.R. § 10.41a(a)(2).
Sincerely,
Lisa L. Burley, Chief
Cargo Security, Carriers and Restricted Merchandise Branch
Office of International Trade, Regulations and Rulings
U.S. Customs and Border Protection