VES-13-18-RR:IT:EC 114481 GOB
Port Director of Customs
Attn.: Vessel Repair Liquidation Unit, Room 107
P.O. Box 2450
San Francisco, CA 94126
RE: Vessel Repair Entry No. C27-0167432-0; 19 U.S.C. 1466; PRESIDENT EISENHOWER, V-118; Petition
Dear Madam:
This is in response to your memorandum dated September 25,
1998, which forwarded the petition submitted by American Ship
Management, LLC ("petitioner") with respect to the above-referenced vessel repair entry.
FACTS:
The PRESIDENT EISENHOWER (the "vessel"), a U.S.-flag vessel
owned and operated by the petitioner, arrived at the port of Los
Angeles, California on February 14, 1998. The subject vessel
repair entry was subsequently filed. The vessel underwent
certain foreign shipyard work in Taiwan in May of 1996.
ISSUE:
Whether the subject items are dutiable pursuant to 19 U.S.C.
1466(a)?
LAW AND ANALYSIS:
19 U.S.C. 1466(a) provides for the payment of duty at a rate
of fifty percent ad valorem on the cost of foreign repairs to
vessels documented under the laws of the United States to engage
in foreign or coastwise trade, or vessels intended to be employed
in such trade.
You have asked us to address 37 items. We will address them
in the order they are presented in your forwarding memorandum.
General services costs. These items are to be prorated per
our oft-stated position.
Drydock costs. These items are to be prorated per our oft-stated position.
Anchor chain (235). We find that this item is nondutiable
as an item incident to a nondutiable ABS inspection.
Outboard longitudinal stiffener of box girder (501). The
invoice states: "An 11 inch long longitudinal crack, along the
fillet weld between the longitudinal and the top box girder
plate, has been generated." We find that this item is a dutiable
repair.
Inboard longitudinal bulkhead of box girder (502). We find
that this item is a nondutiable modification because the invoice
reflects "the addition of box girders" and a decision "to modify
[the] structural configuration," and there is no indicia of
repair.
New fuel oil system (503). The petitioner states: "The
existing fuel oil system was an open-vent type system. It was
incapable of burning residual fuel. A new closed pressurized
system was installed to improve the operating efficiency of the
vessel by permitting the use of lower grade (lower cost) fuel
oil." We find that this item is dutiable under 19 U.S.C. 1466 as
vessel equipment. The fuel oil tank system is more akin to
equipment of the vessel than to a modification to the hull of the
vessel. Vessel equipment is dutiable under 19 U.S.C. 1466. In
Ruling 114259 dated October 15, 1998, we held a new fuel oil tank
level indicating system to be dutiable vessel equipment.
Container stowage (504). The petitioner states that this
item "consisted entirely of the addition of new previously non-existing materials permanently installed by welding to provide
the flexibility to accommodate either 40' or 20' containers
interchangeably in the existing 40' container slots." The
invoice description is consistent with this statement. We find
that this item is a nondutiable modification.
Three-ton electric hoist (110B). The petitioner states that
the hoist was used to transport 208 bottles ashore (and back to
the vessel) for testing as per ABS and U.S. Coast Guard ("USCG")
requirements. We find that this item is nondutiable.
Rudder pintle inspection and calibration (215B) and Doubler
plate (215B). The invoice reflects that these items are ABS/USCG
inspection items. The repair to the rudder is separately
itemized. We find that these items are nondutiable as items
incident to a nondutiable ABS inspection.
Dock trial (129B). The invoice reflects that this four hour
dock trial occurred "... following the ABS and USCG special
survey #3 inspections ..." We find that this item is nondutiable
as an item incident to a nondutiable ABS inspection.
Bilge pumping (131B). The invoice reflects that this work
occurred pursuant to "ABS & USCG regulatory inspections to comply
with the No. 3 ABS Special Survey Requirements." We find that
this item is nondutiable as an item incident to a nondutiable ABS
inspection.
Drew Ameroid Marine invoice (32). The four items on the
subject invoice which your office found to be dutiable are
dutiable because the petitioner has not established that those
items are nondutiable consumables. If the petitioner desires
relief based upon the claim that articles are consumables, it
must provide a clear and specific explanation with respect to
each article and why it would qualify as a consumable.
Steering gear bearings (50). The petitioner requests relief
under 19 U.S.C. 1466(h)(3) for these items which "replaced the
ships spares that were installed." The replacement of spares
indicates non-eligibility for treatment under 19 U.S.C.
1466(h)(3) because such provision requires that the parts be
installed. Accordingly, this claim is denied.
Fire extinguishers (54). Fire extinguishers are not parts
and are therefore not eligible for treatment under 19 U.S.C.
1466(h)(3).
Annunciator card (57). You advise that relief for this item
was not requested on the application. Therefore, it is not
petitionable pursuant to 19 CFR 4.14(d)(2)(i).
Engine room cleaning (62). We find that this item is
nondutiable because it is not a repair or repair-related item.
M.E. tachometer (79). The petitioner has not established
that the tachometer is a part that is eligible for 19 U.S.C.
1466(h)(3). We believe that the tachometer is more akin to
vessel equipment than it is to a part. Accordingly, it is
dutiable.
Engine room cleaning (85). We find that this item is
nondutiable because it is not a repair or repair-related item.
R.T.D.'s for main engine (114). The petitioner requests
relief under 19 U.S.C. 1466(h)(3) for these items which "replaced
the ships spares that were installed." The replacement of spares
indicates non-eligibility for treatment under 19 U.S.C.
1466(h)(3) because such provision requires that the parts be
installed. Accordingly, this claim is denied.
M.E. Bearings #9-10 (135). The invoice reflects "labor to
open for inspection main engine ... bearings #9 and #10." We
find that this item is nondutiable.
Fathometer parts (139). We find that these articles are
eligible for treatment under 19 U.S.C. 1466(h)(3).
Foundation bolts and chocks inspection - retension (170).
We find that this item is nondutiable as an ABS requirement.
M.E. turbocharger #3 overhaul (173). This item is not
eligible for treatment under 19 U.S.C. 1466(h)(3). The invoice
reflects "Materials & Parts, see spec." Materials are not
eligible for 19 U.S.C. 1466(h)(3) treatment.
Tie rods inspection and retensioning (219). We find that
this item is nondutiable as an ABS requirement.
Oxygen and acetylene bottles (254). These articles are
nondutiable consumables.
Servicing of fire fighting equipment (255). We find that
this is a dutiable maintenance item.
Twelve sets O rings kit (273). The invoice describes this
item as materials and equipment. Therefore it is not eligible
for treatment under 19 U.S.C. 1466(h)(3).
Transistors and Resistors (278). We find that the subject
items are parts eligible for treatment under 19 U.S.C.
1466(h)(3).
Life raft #2 inspection (282). We find that this item is
nondutiable as incident to a nondutiable USCG inspection.
Main engine piston rings (354). We find that the subject
items are parts eligible for treatment under 19 U.S.C.
1466(h)(3).
M.E. fuel oil pump block (372 and 373). The parts itemized
on the third sheet of each invoice are eligible for treatment
under 19 U.S.C. 1466(h)(3).
Microphone (387). This item is not a part and therefore not
eligible for treatment under 19 U.S.C. 1466(h)(3).
Drew Chemical Corp invoice (PO #175182) (395). We find that
these items are dutiable. If the petitioner desires relief based
upon the claim that articles are consumables, it must provide a
clear and specific explanation with respect to each article and
why it would qualify as a consumable.
Materials purchased by the vessel owner in the United States
are nondutiable under 19 U.S.C. 1466 only if the vessel owner
provides documentation from the vendor that the materials are of
U.S. origin. Such documentation has not been provided here.
Lifeboat fuel tank (396). We find that this item is not
eligible for 19 U.S.C. 1466(h)(3). The petitioner has not
established that it is a part.
Battery for radio (407). The petitioner has not established
eligibility for 19 U.S.C. 1466(h)(3). A battery is not a part.
Therefore this item is dutiable.
HOLDING:
As stated above, the petition is granted in part and denied
in part.
Sincerely,
Jerry Laderberg
Chief,
Entry Procedures and Carriers
Branch