VES-13-18-CO:R:IT:C 112925 DEC
Chief, Residual Liquidation and Protest Branch
United States Customs Service
Six World Trade Center
New York, New York 10048-0945
RE: Vessel Repair Entry No. C46-0015866-0, NOSAC RANGER V-79;
Petition; Casualty; 19 U.S.C. 1466(d)(1); 19 C.F.R. 4.14
Dear Sir:
This is in reference to your memorandum of October 8, 1993,
which transmitted a petition for review of the assessment of
vessel repair duties filed in connection with the above-
referenced vessel repair entry.
FACTS:
The NOSAC RANGER, is a U.S.-flag vessel owned by Car
Carrier, Inc. The record shows that the shipyard work in
question was performed on the subject vessel in Antwerp, Belgium,
on October 22, 1992, and Bremerhaven, Germany, on October 24,
1992.
The petitioner is challenging the assessment of duty based
on its contention that the repairs performed were necessary
because of a casualty. The petitioner states that the costs were
incurred as a result of propeller damage, first discovered by
divers in Antwerp, Belgium on October 22, 1992. On October 20,
1992, the vessel reduced its speed for arrival in LeHavre,
France. The vessel experienced abnormally high vibration or
"bucking," the incident was recorded in the vessel's log, and the
master reported the problem to Pacific-Gulf on October 21, 1992.
The vessel proceeded to Southhampton, England. Divers could not
be mobilized prior to the vessel's departure from Southhampton.
The vessel arrived at her next port, Antwerp, Belgium, on October
22, 1992, where an underwater survey revealed that the propeller
was missing approximately two feet from the tip of one of its
blades. Pacific-Gulf contacted Det Norske Veritas (DNV), a
classification society, and LIPS to advise them of the damage.
The vessel departed Antwerp on October 23, and proceeded to her
next port, Bremerhaven, Germany, where DNV surveyed the damaged
area, and advised that the propeller damage had to be dealt with
prior to departure from Bremerhaven.
-2-
ISSUE:
Whether there is sufficient proof to establish that the
subject repairs were necessitated by a "casualty" which is
remissible under the vessel repair statute (19 U.S.C. 1466).
LAW AND ANALYSIS:
The United States Coast Guard (USCG) is the controlling
agency that determines questions of a vessel's fitness to
proceed. The procedure by which the USCG renders such a
determination is set forth in sections 2.01-15 and 31.10-25, USCG
Regulations (46 C.F.R. 2.10-15, 31.10-25). The former states
that a vessel may not proceed from one port to another for
repairs unless prior authorization is obtained from the USCG
Officer-In-Charge, Marine Inspection (OCMI) either through the
issuance of a USCG "Permit to Proceed to Another Port for
Repairs" (CG-948) or a CG-835 that would specify the restrictions
on, and duration of, any voyage undertaken prior to obtaining
permanent repairs.
Notwithstanding the clear wording of the above USCG
Regulations, specifically 46 C.F.R. 2.10-15 that does not
distinguish between foreign or domestic locations, Customs has
been informed by the OCMI, New York, New York, in a letter dated
November 7, 1991, that "A formal Permit to Proceed is not
normally issued to a vessel transiting foreign waters because the
Certificate of Inspection (COI) would have to be removed from the
vessel that would cause problems in transiting foreign waters."
In addition, we have subsequently learned from the Chief,
Merchant Vessel Inspection and Documentation Division, USCG
Headquarters, in a letter dated April 14, 1992, that "Vessel
operators often make casualty reports for U.S. flag vessels
damaged overseas verbally to the proper Coast Guard Marine
Inspection Office, followed by the required written report. The
Coast Guard cannot always send a marine inspector to a damaged
vessel overseas on short notice. In such cases, the Coast Guard
may consider the classification society report and the report of
the vessel's master to determine the required temporary repairs
and voyage restrictions."
Our review of the evidence submitted with the application
reveals that the damage was caused by a casualty. The report
shows that the damage to the vessel was possibly caused on
October 20, 1993, when the vessel was entering the port of
LeHavre. With regard to the evidence that the vessel was in need
of repairs to secure her safety and seaworthiness, however, the
documents show that the repairs to the propeller were not made
until October 24, 1992, when the vessel arrived in the port of
Bremerhaven, subsequent to a survey of the damage at the port of
Antwerp.
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Notwithstanding any practice of verbally reporting foreign
casualties to the USCG and that agency's subsequent verbal
instructions, remission pursuant to 19 U.S.C. 1466(d)(1) will not
be granted in the absence of documentary evidence that the
casualty occurrence was timely reported to the USCG and that
agency, directly or through the medium of a marine surveyor,
permitted the vessel to proceed between two foreign locations in
a damaged condition. The mere submission of a USCG Report of
Marine Accident, Injury or Death (CG-2692), without accompanying
documentation from the appropriate USCG OCMI (New York or
Honolulu) authorizing the vessel to proceed in a damaged
condition, will not suffice for granting remission pursuant to 19
U.S.C. 1466(d)(1).
Based on a review of the September 15, 1993, letter from the
United States Coast Guard-Inspections Department, Customs is
satisfied that the damage to the propeller blade is a casualty as
defined under 19 U.S.C. 1466(d)(1). It is apparent that Customs
was reluctant to classify the damage to the propeller as a
casualty because the vessel proceeded in a state of disrepair
between two foreign locations prior to being repaired. In
addition, no documentary evidence indicating that the casualty
occurrence was timely reported to the United States Coast Guard
(USCG) was submitted nor did the USCG issue a permit to proceed
between two foreign ports in a damaged condition.
HOLDING:
The above-referenced letter of September 15, 1993, together
with a review of the record, provide a sufficient basis to
substantiate the petitioner's claim that the subject repairs
constitute a casualty. The duty with respect to the foreign work
for which the applicant seeks remission is granted in full.
Sincerely,
Arthur P. Schifflin
Chief
Carrier Rulings Branch