Vessel Repair; 19 U.S.C. 1466; Protest; M/V NEDLLOYD HUDSON, V-39; Entry No. 559-1237242-6; Casualty

HQ 113246 October 13, 1994 VES-13-18-CO:R:IT:C 113246 GOB CATEGORY: Carriers Chief, Residual Liquidation and Protest Branch New York Region Six World Trade Center New York, New York 10048-0945 RE: Vessel Repair; 19 U.S.C. 1466; Protest; M/V NEDLLOYD HUDSON, V-39; Entry No. 559-1237242-6; Casualty Dear Sir: This is in response to your memorandum dated September 30, 1994, which forwarded the protest submitted by Sea-Land Service, Inc. ("protestant") in connection with the above-referenced entry. FACTS: The record reflects that the M/V NEDLLOYD HUDSON (the "vessel") arrived at the port of Boston on August 21, 1991. Vessel repair entry no. 559-1237242-6 was filed on August 23, 1991. Shipyard work was performed on the vessel in Rotterdam, Holland. By letter dated June 11, 1993, your office denied in part the application for relief in this case based upon "insufficient documentation for `casualty.' " By Ruling 112909 dated October 20, 1993, this office denied the petition based on the lack of good and sufficient evidence that the foreign repairs were necessary to secure the safety and seaworthiness of the vessel to enable it to reach its port of destination. The protestant asks for relief with respect to the same two items which were the subject of the petition, item no. 124 on Wilton-Fijenoord b.v. invoice dated August 16, 1991 and ABS survey invoice no. RO 9885. In support of its claim that remission is warranted, the protestant has submitted the following documentation: 1. an affidavit from its Manager, Fleet Services dated April 7, 1994; - 2 - 2. a Marine Inspection Report from the U.S. Coast Guard - handwritten notes dated August 6, 1991 through August 10, 1991; 3. an ABS Report dated August 10, 1991; 4. a certification by the master of the vessel dated July 1, 1993; 5. a copy of U.S. Coast Guard Form 2692, Report of Marine Accident, Injury or Death signed by the master of the vessel and dated August 4, 1991; and 6. a copy of the vessel's deck log for August 3, 1991. ISSUE: Whether, pursuant to 19 U.S.C. 1466(d)(1), good and sufficient evidence has been submitted which warrants the remission of vessel repair duties. 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. 19 U.S.C. 1466(d)(1) provides in part that the Secretary of the Treasury is authorized to remit or refund such duties if the owner or master of the vessel furnishes good and sufficient evidence that the vessel was compelled by stress of weather or other casualty to put into a foreign port and make repairs to secure the safety and seaworthiness of the vessel to enable her to reach her port of destination. 19 CFR 4.14(c)(3)(i) provides that "port of destination" means such port in the United States and "... only the duty on the cost of the minimal repairs needed for the safety and seaworthiness of the vessel is subject to remission or refund." 19 U.S.C. 1466 and 19 CFR 4.14 essentially set forth a three- part test, all of the elements of which must be established by good and sufficient evidence to qualify for remission: 1. a casualty occurrence; 2. an unsafe and unseaworthy condition; and 3. the inability to reach the port of destination without foreign repairs. - 3 - After a consideration of the evidence of record, we find that the protestant has satisfied the three-part test described supra. In particular, the U.S. Coast Guard Marine Report and the ABS Report are instrumental in establishing the protestant's claim. HOLDING: Pursuant to 19 U.S.C. 1466(d)(1), the protestant has submitted good and sufficient evidence that the vessel was compelled by casualty to make the subject repairs to secure the safety and seaworthiness of the vessel to enable her to reach her port of destination. Accordingly, the protest is granted. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, the Freedom of Information Act and other public access channels. Sincerely, Arthur P. Schifflin Chief Carrier Rulings Branch