HQ 0223593 - Protest 30041 000165, Harbor Maintenance Fee; Exempt Ports; 26 U.S.C. 4462; 19 CFR 24.24; Treasury Decision 92-7 - United States International Trade Commision Rulings

United States International Trade Commision Rulings And Harmonized Tariff Schedule

faqs.org Rulings By Number Rulings By Category Tariff Numbers

faqs.org > Rulings and Tariffs Home > Rulings By Number > 1993 HQ Rulings > HQ 0223541 - HQ 0223772 > HQ 0223593

HQ 223593

May 11, 1992

LIQ-9/FIS-4-08-CO:R:C:E 223593 PH

CATEGORY: PROTEST

District Director of Customs
(Seattle Area/Port of Blaine)
Seattle, Washington 98104-1049

RE: Protest 30041 000165, Harbor Maintenance Fee; Exempt Ports; 26 U.S.C. 4462; 19 CFR 24.24; Treasury Decision 92-7

Dear Sir:

The above-referenced protest was forwarded to this office for further review. We have considered the points raised by your office and the protestant. Our decision follows.

FACTS:

According to the file, the protestant entered a quantity of aluminum oxide (alumina) on April 22, 1987, at Bellingham, Washington. The merchandise was unloaded at a company-owned dock located at Cherry Point, Washington. Harbor maintenance fees were assessed against the merchandise at the rate of .04 percent. The described entry and 19 other similar entries were liquidated on April 12, 1991. On July 8, 1991, the protestant filed a protest of the liquidations, contending that the dock where the merchandise was unloaded was exempt from the harbor maintenance fee. The protestant also contended that Customs was required to pay interest on the harbor maintenance fees deposited at the time of entry.

The protestant asked for further review in the protest and you forwarded the protest to this office for such review.

ISSUES:

(1) May the protest against the assessment of harbor maintenance fees on the unloading of merchandise at a company- owned dock at Cherry Point, Washington, be granted in this case?

(2) If the protest under consideration may be granted, is interest payable on the harbor maintenance fees paid from the date of deposit of the fees or, alternatively, from the date of liquidation of the entries protested?

LAW AND ANALYSIS:

Initially, we note that the protest, with application for further review, was timely filed under the statutory and regulatory provisions for protests (see 19 U.S.C. 1514 and 19 CFR Part 174) and that the decision protested, assessment of harbor maintenance fees, is a protestable decision (see 19 U.S.C. 1514(a)(5) and 26 U.S.C. 4462(f)).

The statutory authority for the harbor maintenance fee is found in the Water Resources Development Act of 1986 (Public Law 99-662; 100 Stat. 4082, 4266; 26 U.S.C. 4461 et seq.) Under this statute, a fee is imposed for the use of a port, defined as any channel or harbor or component thereof in the United States which is not an inland waterway, is open to public navigation, and at which Federal funds have been used since 1977 for construction, maintenance, or operation.

The Customs Regulations promulgated under the authority of this statute (19 CFR 24.24) list the ports subject to the harbor maintenance fee. When initially promulgated (see Treasury Decision (T.D.) 87-44), the ports in the Puget Sound listed as being subject to the harbor maintenance fee included Bellingham, with a note "Includes only the ports listed." In T.D. 92-7, section 24.24 was amended and the following was added to the notes regarding Puget Sound ports: "Bellingham includes all of Bellingham Bay and tributary waters north of Chuchanut Bay on the east, and Portage Island on the west."

The dock where the merchandise under consideration was unloaded is not within the geographical boundaries defined in the note quoted above with regard to Bellingham. Customs has issued a letter (File MAN-1-IC:W PAB, dated April 21, 1992) confirming that this is so and that merchandise unloaded at this location is not subject to the harbor maintenance fee. With regard to the question of refunds, Customs has taken the position that a refund will be granted for entries of merchandise unloaded at this location which have been liquidated and for which a protest was timely filed. Therefore, the protest is GRANTED with regard to the issue of the applicability of the harbor maintenance fee.

The protestant also seeks interest on the harbor maintenance fees paid, "from the date of the deposit of the estimated duties, or alternatively, from the date of liquidation of the entries identified by this protest." The Court of Appeals for the Federal Circuit recently addressed the issue of interest payable on excessive duties (see Kalan, Inc. v. United States, 944 F. 2d 847, Vol. 26 Cust. Bull. & Dec., No. 10, March 4, 1992, page 25 (1991). In this case, the Court held that excessive duties paid are not "increased or additional duties" within the meaning of 19 U.S.C. 1520(d) and, when such excessive duties are refunded pursuant to a granted protest, no interest is payable thereon.

We note that under 26 U.S.C. 4462(f) (cited above), except as otherwise provided in regulations, all administrative and enforcement provisions of the Customs laws and regulations apply in respect to the harbor maintenance fee as if it were a duty. (Note: We emphasize that although this provision makes all administrative and enforcement provisions of the Customs laws and regulations applicable to the harbor maintenance fee as if it were a duty, it does not transform the harbor maintenance fee into a Customs duty (see, in this regard, S. Rept. 99-126 (August 1, 1985) page 7, reprinted at U.S.C.C.A.N. 6644 (1986), and H. Rept. 99-228 (January 8, 1986), pp. 3 and 10, reprinted at U.S.C.C.A.N. 6707 and 6714-6715) (1986)).) Even if the harbor maintenance fee is treated as if it were a duty for purposes of the statute authorizing the payment of interest on increased or additional duties (19 U.S.C. 1520(d)), pursuant to the Kalan decision no interest would be payable because the harbor maintenance fees paid in this case are not analogous to increased or additional duties. The protest is DENIED with regard to the issue of the granting of interest on the harbor maintenance fees paid with these entries.

HOLDING:

(1) The protest against the assessment of harbor maintenance fees on the unloading of merchandise at a company- owned dock at Cherry Point, Washington, is granted.

(2) Interest is not payable on the harbor maintenance fees paid, either from the date of deposit of the fees or from the date of liquidation of the entries protested.

The protest is GRANTED in part and DENIED in part. A copy of this decision should be attached to the Form 19, Notice of Action, to be sent to the protestant.

Sincerely,

John Durant, Director

Previous Ruling Next Ruling