Vessel Repair Entry No. H24-0021221-1; ALASKA SPIRIT; 19U.S.C.  1466; Application for Relief

HQ 227038 February 19, 1998 VES-13-18-RR:IT:EC 227038 CC CATEGORY: Carriers Chief, Liquidation Branch U.S. Customs P.O. Box 2450 San Francisco, CA 94126 RE: Vessel Repair Entry No. H24-0021221-1; ALASKA SPIRIT; 19 U.S.C.  1466; Application for Relief Dear Sir: This is in response to your memorandum dated June 7, 1996, which forwarded the application for relief submitted by Western Overseas Corporation, on behalf of The Fishing Company of Alaska, Inc. (applicant), with respect to the above-referenced vessel repair entry. FACTS: The vessel ALASKA SPIRIT underwent extensive shipyard operations while outside of the United States. Subsequent to completion of foreign shipyard work, the vessel arrived at the port of Dutch Harbor, Alaska on January 9, 1996. A vessel repair entry was filed on the day of arrival. Pursuant to an authorized extension of time, an application for relief was timely filed. Various claims for relief have been made in the application. Counsel for the applicant states that a fire did substantial damage to the vessel in May 1995. The vessel was towed to Japan for repairs in September 1995. The certificate of documentation was destroyed in the fire, and a replacement was applied for and subsequently received in December 1995. Counsel argues that because the certificate of documentation was destroyed in the fire, and, the vessel repairs were performed on the vessel before a replacement was issued, it was not documented when the repairs were made, making them nondutiable under 19 U.S.C.  1466. The vessel repairs claimed by counsel to be nondutiable relate to work done by NKK Shipyard. Western Overseas Corporation states that if we do not agree with counsel's position, we should find, in the alternative, that the Texaco decision does not apply to the subject entry. Finally, in a submission entitled "Footnote Titles," various general categories of repairs are listed, with arguments as to why each category of repair should not be dutiable. Various bills, receipts, invoices, and worksheets have been submitted in support of the application. ISSUES: 1. Whether the vessel was undocumented and vessel repairs are not dutiable because the vessel documentation was destroyed by fire and no replacement documentation had been issued prior to the repairs being made. 2. For the remaining claims, whether sufficient evidence has been submitted which would allow thorough consideration of the dutiability of the foreign shipyard operations involved in the above-referenced entry. LAW AND ANALYSIS: 19 U.S.C.  1466 provides, in pertinent part, for the payment of duty in the amount of 50 percent ad valorem on the cost of foreign repairs to vessels documented under the laws of the United States to engage in the foreign or coastwise trade, or vessels intended to be employed in such trade. Concerning counsel's claim concerning the NKK Shipyard charges, it is requested that 127,000 yen of the 150,000 yen charges be found to be nondutiable. A work list is provided with the charges listed, designating some as related to the hull part and the remainder related to the electric part. An agreement between the Fishing Company of Alaska, Inc., and NKK Corporation for the payment of 150,000 yen to NKK Corporation for repair work on the ALASKA SPIRIT is provided. Various invoices were also submitted. Counsel's claim concerning these expenses is that they are nondutiable because the vessel was not documented at the time the repairs were made. The reason the vessel was undocumented, counsel claims, is that the vessel documentation was destroyed in a fire and a replacement documentation had not yet been issued. In essence, counsel's argument is that if the physical certificate of vessel documentation is lost or destroyed, the vessel becomes undocumented at the moment the loss or destruction of the certificate occurs. Counsel's argument is analogous to arguing that a motor vehicle that has its license plates lost or destroyed is unregistered, or a person who loses his driver's license (the physical license he carries in his wallet, e.g.) is no longer licensed to operate a motor vehicle. In the above examples, a vehicle would still be registered if the license plates were lost or destroyed, and a person would still be licensed to operate a vehicle if his driver's license were lost. Similarly, a vessel whose certificate of documentation is destroyed is still documented. We have contacted the National Vessel Documentation Center of the U.S. Coast Guard and have been informed that the vessel would still be considered documented even if the documentation were destroyed by fire, despite the fact that a replacement documentation had not yet been issued. In addition, we have reviewed the regulations concerning vessel documentation in 46 CFR Part 67. Although these regulations are within the jurisdiction of the U.S. Coast Guard and we leave their interpretation to that agency, we see nothing in those regulations that indicate counsel's claim has any merit. Consequently, counsel's claim for the remission of the subject vessel repair duties listed above is denied. Based on this finding, we need not address the issue of whether an undocumented vessel is subject to vessel repair duties. Concerning the remaining claims, the regulations governing the submission of evidence and the determination of dutiability of foreign shipyard operations under section 1466 are found in section 4.14 of the Customs Regulations (19 CFR  4.14). Subsection (d)(1) of 19 CFR  4.14 provides that while an Application for Relief need not be submitted in any particular format, it is necessary that it: ...allege that an item or a repair expense covered by the entry is not subject to duty under paragraph (a) of this section, or that the articles purchased or the repair expenses are within the provisions of paragraph (c) of this section, or that both conditions are present. It is Customs position that for the purpose of the issuance of rulings of this office with respect to applications , petitions, and protests, that an item must be identified within the text of the application, petition, and/or protest . The mere inclusion of an item on a spreadsheet or worksheet, is not sufficient for this purpose. See HQ 114157, dated November 28, 1997; HQ 113839, dated March 3, 1997; and HQ 111714, dated January 22, 1992. The applicant has failed to make any assertions that specific items are nondutiable. In addition, although some general arguments have been made why vessel repairs should be nondutiable, the applicant has not related these arguments to specific items. Consequently, we find that relief cannot be granted for the remaining claims. HOLDING: Following review of the evidence submitted and an analysis of the applicable law and precedents, we have determined that, as a matter of law, relief cannot be granted for the reasons set forth in the Law and Analysis section of this ruling. Sincerely, Jerry Laderberg Chief Entry Procedures and Carriers Branch