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HQ 113229





September 22, 1994

VES-13-18-CO:R:IT:C 113229 GOB

CATEGORY: CARRIER

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; Entry No. 137-1038094-2; S.S. MORMACSKY; Protest

Dear Sir:

This is in response to your memorandum dated September 16, 1994 which forwarded for our review and ruling the above- referenced protest on the assessment of vessel repair duties.

FACTS:

The record reflects the following. The S.S. MORMACSKY ("vessel"), which is operated by Mormac Marine Transport Inc. ("protestant") arrived at the port of Providence, R.I. on August 25, 1994 and filed the above-referenced vessel repair entry on September 1, 1993.

The entry was liquidated on January 14, 1994.

Protestant's Claims

The protest states as follows, in part:

As stated in the Master's application for relief submitted with the entry, the cost of hold cleaning in preparation for loading the next cargo should be non-dutiable (letter attached)...

We believe that the cost of equipment, parts, labor and material used for the erection of temporary bulkheads or similar devices for the control of bulk cargo is specifically non-dutiable under Section 4.14(c)(3)(iii), and therefore request a review of this calculation.

ISSUE:

Whether the items at issue are dutiable under 19 U.S.C. 1466.

LAW AND ANALYSIS:

19 U.S.C. 1466 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.

With respect to the first issue raised by the protestant (invoice no. 93-8237), we find that the nature of the work performed is not fully clear from the invoice. The invoice reflects various activities including: cleaning; installing, capping, and securing of pipes; hot work; welding; and the removal and transportation of equipment. The invoice states at one point "Conversion of a tanker to load grain." The invoice further states: "On completion work inspected by Port Authorities and ship's staff and found satisfactory."

We are unable to conclude that the work performed with respect to this invoice was merely "hold cleaning." We find that, with the exception of the separately itemized transportation and cranage costs which are nondutiable and the gas free certificate cost which is to be apportioned between dutiable and nondutiable costs, the costs on this invoice are dutiable.

Similarly, with respect to the second issue raised by the protestant (invoice no. 93-8238), we find that the nature of the work performed is not clear from the invoice. The invoice indicates that ballast pump strainers, cargo pump strainers, and a cone were "made up" or "fabricated." We are unable to conclude that the costs on this invoice are nondutiable pursuant to 19 CFR 4.14(c)(3)(iii). Accordingly, the costs are dutiable.

HOLDING:

As detailed supra, with the exception of the separately itemized transportation and cranage costs which are nondutiable and the gas free certificate cost which is to be apportioned between dutiable and nondutiable costs, the protest is denied.

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

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