CBP Says Beer Kegs Qualify for Duty-Free Treatment as IITs, Trade Remedies Apply If Enter US Commerce

Stainless steel beer kegs used by Anheuser-Busch (AB) to transport beer are eligible for duty-free treatment as Instruments of International Traffic but would be subject to applicable trade remedies if the kegs enter U.S. commerce, CBP said in a June 13 ruling that the agency recently posted. Customs lawyer Michael Roll requested the ruling on behalf of AB as to the treatment of the kegs, which are of Chinese, U.S., Spanish, Mexican and German origin. AB will fill the subject kegs with beer outside the U.S. and will import them mostly through 22 U.S. ports, the company told CBP.

Following imports of the kegs, the company delivers the kegs to customers, who pay a deposit so each keg is returned, CBP said. “The customer or distributor will then deliver each keg to an end user, such as a restaurant or bar,” CBP said. “Once the end user has finished the contents of a keg, the keg will be returned to AB for cleaning and shipment abroad for reuse. This cycle will continue for the useful life of a keg, which can be up to 30 years. On average, you report that each keg will remain in the United States for approximately six months or less. You state that AB will transport millions of kegs per year in this manner.”

The company tracks the kegs while they are in the U.S. using bar codes and time stamps, CBP said. AB records each unique keg ID when loading shipping containers for return abroad and “will file IIT diversion reports as necessary for any keg that is lost, stolen, or otherwise diverted in the” U.S. From the submitted information, “we find that the subject stainless steel beer kegs are used as containers in international traffic, are substantial, suitable for and capable of repeated use, and used in significant numbers in international traffic,” CBP said. As a result, the kegs qualify for entry-free and duty-free treatment as IITs in subheading 9803.00.50 of the Harmonized Tariff Schedule of the U.S.

The agency also provided classification information for the kegs. The applicable subheadings -- 7310.29.0025, 7310.29.0050 or 7310.10.0050 -- are all duty-free. Those subheadings are subject to the Section 301 tariffs on goods from China, which would apply if the kegs were to enter U.S. commerce, CBP said. The same is true of any antidumping or countervailing duties that may apply to stainless steel kegs from Germany, Mexico or China, CBP said.