HQ 225042: Ruling request concerning the requirements on the use of onboard under bond distilled spirits during flight; 19 U.S.C.1555(b); 19 U.S.C. 1309; 19 CFR 10.59, 10.62, and 10.64; Customsruling HQ 305754 (Customs Legal Determination 3137-03 (June 8,1978)).

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 225042

                          July 14, 1994


CON-13-02 CO:R:C:E 225042  TLS

CATEGORY: Entry

Mr. Trevor Long
Qantas Airways Limited
Qantas Centre
203 Coward Street
Mascot 2020
Australia


RE: Ruling request concerning the requirements on the use of on
board under bond distilled spirits during flight; 19 U.S.C.
1555(b); 19 U.S.C. 1309; 19 CFR 10.59, 10.62, and 10.64; Customs
ruling HQ 305754 (Customs Legal Determination 3137-03 (June 8,
1978)).


Dear Mr. Long:

     This office has received the above-referenced request for a
ruling as provided for under Customs regulations.  We have
considered the request and have made the following decision.

FACTS:

     Your company is an airline that serves its passengers
distilled spirits during flights.  The airline generally serves
pre takeoff alcoholic beverages as a courtesy for its passengers. 
As you correctly note, the U.S. Customs Service does not permit
such beverages to be supplied from under bond stocks.  You state
that Qantas purchases the distilled spirits from duty-paid stocks
for this use.  You request that we review Customs policy of not
allowing these beverages to be supplied from under bond stocks
and that you be granted permission to do so.

ISSUE:

     Whether commercial airlines may be permitted to serve pre-takeoff alcoholic beverages supplied from under bond stocks.


LAW AND ANALYSIS:

     There are two statutes that govern the delivery of duty-free
merchandise from a Customs bonded warehouse.  Duty-free sales
enterprises operate under 19 U.S.C. 1555(b).  The delivery of
aircraft supplies, such as as alcoholic beverages to be served to
passengers and fuel to be used by the aircraft is done pursuant
to 19 U.S.C. 1309.

     With respect to aircraft stores, paragraph (3)(F) of 19
U.S.C. 1555(b) provides for the delivery to an area restricted to
departing international passengers, delivery to the aircraft as
passenger baggage, or to the gate holding area of an airport. 
These activities are permitted only if there is reasonable
assurance that duty-free merchandise so delivered will be
exported.  That statute has been implemented by section 19.39 of
the Customs regulations.  With respect to delivery of merchandise
to a passenger, the airline is required not to release that
merchandise until the aircraft has departed for its foreign
location.

     With respect to the delivery of bonded fuel or aircraft
supplies to a foreign registered aircraft, the provisions of 19
U.S.C. 1309(a)(3) govern.  The statute requires that the aircraft
be engaged in foreign trade.  The statute also requires that
aircraft registered in the United States be accorded
substantially reciprical privileges by the country of foreign
registration.  It does not require identical reciprocity and it
does not permit treatment in excess of the that provided in
paragraph (a)(3), even if the foreign government does so.  While
you allege that the Government of Austrailia provides a more
extensive exemption for duties, you did not provide any evidence
in support of that allegation.  On the contrary, our Government 
found that the Government of Austrailia did not allow the duty-free use of ground equipment by American registered airlines. 
That finding was published as T.D. 54747(1) (1958) and continues
in effect today (19 CFR 10.59(f)).

     The delivery of bonded fuel to aircract under 19 U.S.C. 1309
is governed by sections 10.59, 10.62, and 10.64 of the Customs
regulations.  Foreign aircraft with departing passengers must be
actually transporting those passengers to a foreign location. 
The delivery of supplies other than fuel is governed by sections 
10.59 and 10.62a of the Customs regulations. Under section 10.64
of the Customs regulations the cancellation of the bond
obligation for both fuel and other supplies does not occur until
the aircraft's departure in foreign trade.

     The Customs Service has determined the departure of an
aircract in foreign trade to occur when all persons who are not
to depart have left the aircraft, all doors to the aircraft have
been closed, and the boarding ramp is withdrawn.  Customs ruling
HQ 305754 (Customs Legal Determination 3137-03 of June 8, 1978).

HOLDING:

     A foreign registered aircraft that is eligible to withdrawn
duty-free alcoholic beverages from a Customs bonded warehouse as
aircraft supplies under 19 U.S.C. 1309(a) may not serve those
beverages until all persons that will not depart with the
aircraft have left the aircraft, all aircraft doors are closed,
and the boarding ramp has been withdrawn.

                    Sincerely,




                    John Durant, Director
                    Commercial Rulings Division