Vessel Repair Entry No. NF4-4331125-5; M/V LIBERTY; L05-21; Protest No. 2002-07-101533; 19 U.S.C. § 1466(a)

HQ H022162 May 27, 2008 VES-13-18:RR:BSTC:CCI H022162 ALS CATEGORY: Carriers Supervisory Import Specialist Vessel Repair Unit U.S. Customs and Border Protection 1515 Poydras Street, Suite 1700 New Orleans, Louisiana 70112 RE: Vessel Repair Entry No. NF4-4331125-5; M/V LIBERTY; L05-21; Protest No. 2002-07-101533; 19 U.S.C. § 1466(a) Dear Sir: This is in response to your memorandum of January 14, 2008. The memorandum forwards an application for further review of a protest filed on behalf of Interocean American Shipping Corporation (“Interocean”), seeking relief for duties assessed pursuant to 19 U.S.C. § 1466(a). You have asked us to review two invoices noted in your memorandum, as well as your assessment of duties in this case. Our ruling follows. FACTS: The M/V LIBERTY (the “vessel”), a U.S.-flag vessel owned by the protestant, incurred foreign shipyard costs. The vessel arrived in the port of Bayonne, New Jersey on November 25, 2005. A vessel repair entry was timely filed. No application for relief was filed. After a determination of duty, dated May 18, 2007, was issued by your office, the protestant timely filed the subject application for further review on August 9, 2007, seeking relief pursuant to 19 U.S.C. § 1466(a). ISSUE: Whether the costs for which the protestant seeks relief are dutiable under 19 U.S.C. § 1466(a). LAW AND ANALYSIS: Title 19, United States Code, section 1466(a) provides in pertinent part for the payment of an ad valorem duty of 50 percent of the cost of “. . . equipments, or any part thereof, including boats, purchased for, or the repair parts or materials to be used, or the expenses of repairs made in a foreign country upon a vessel documented under the laws of the United States . . . “ The following items are at issue: Item 1: An invoice from Lloyd-Werft Bremerhaven GmbH, dated November 23, 2005, that refers to a “repair time” of November 13, 2005 and “main engine work-3 engine filters were provided to assist service technicians for main engine works per attached time sheets on Sunday, 13th of November 2005.” Item 2, An invoice from Man B&W Diesel, Inc., dated June 7, 2006, that refers to “works done: for class inspection-crankweb defeltion taken, -inspection of main bearing/crosshead,” and “14 Sunday/Holiday hours… 5 traveling hours… allowance… hotel… [and] travel by own car.” The invoice also refers to an order date of November 10, 2005. We will discuss these items in turn. Item 1 The protestant contends that relief should be granted because the work was done pursuant to mandatory surveys and related services. The protestant cites to C.S.D. 79-227, Waterman Steamship Corporation v. United States, 26 Cust. Ct. 114, and numerous CBP rulings to support this contention. While the protestant is correct in citing C.S.D. 79-277 with respect to the dutiability of the costs of a survey required by a qualifying entity (e.g., governmental entity, classification society, or insurance carrier), it is not controlling with respect to dutiable repairs done pursuant to such surveys. We note that the Lloyd-Werft invoice does not refer to a survey. Regardless, we cannot verify the protestant’s claim with only the submitted documents. Furthermore, the subject invoice clearly refers to repairs. Therefore, we find that the costs applied to this item are dutiable. Item 2 The protestant contends that the costs associated with this invoice should be non-dutiable for the same reason given for Item 1. Just as with that invoice, the protestant has failed to submit sufficient documentation to justify a non-dutiable determination for this invoice. Therefore, we find the costs applied to this item are dutiable. HOLDING: Following a thorough analysis of the facts as well as of the law and applicable precedents, we have determined that the protest with respect to the items considered above should be denied as specified in the Law and Analysis portion of this ruling. In accordance with the Protest/Petition Processing Handbook (CIS HB, January 2002, pp. 18 and 21), you are to mail this decision, together with the Customs Form 19, 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 make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution. Sincerely, Glen E. Vereb Chief Cargo Security, Carriers, and Immigration Branch