HQ 225954 - Protest 1401-94-100110; uranium; Harbor maintenance fee; 19 CFR 24.24(a); 19 CFR 24.24(c)(7); 26 U.S.C. 4461(c)(1); 19 CFR 24.24(e)(3)(i); 26 U.S.C. 4462(e). - United States International Trade Commision Rulings

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HQ 225954

July 13, 1995

ENT-1-03:R:C:E 225954 AJS

CATEGORY: ENTRY

District Director of Customs
U.S. Customs Service
101 East Main Street
Norfolk VA 23510

RE: Protest 1401-94-100110; uranium; Harbor maintenance fee; 19 CFR 24.24(a); 19 CFR 24.24(c)(7); 26 U.S.C. 4461(c)(1); 19 CFR 24.24(e)(3)(i); 26 U.S.C. 4462(e).

Dear Sir or Madame:

This is our decision in protest 1401-94-100110, dated May 5, 1994, concerning the imposition of the Harbor Maintenance Fee (HMF) on the importation of uranium.

FACTS:

The protestant (i.e., Global Nuclear Services and Supply (GNSS)) seeks a refund of $39,110.40 paid in HMF with interest from the date of payment February 25, 1994. The subject uranium was shipped under a U.S. Department of Energy (DOE) contract for delivery to the United States Enrichment Corporation (USEC). GNSS is the shipper of the subject uranium and is the importer for the entry of uranium.

ISSUE:

Whether the exemption from the HMF provided by 26 U.S.C. 4462(e) and 19 CFR 24.24(c)(7) applies to a private company that imports uranium pursuant to a contract with USEC.

LAW AND ANALYSIS:

Title 26, United States Code, sections 4461 and 4462 provide for the imposition of the HMF, including special rules regarding its administration. The applicable regulatory authority promulgated pursuant to these statutes is found in section 24.24, Customs Regulations (19 CFR 24.24). Specifically, section 24.24(a) provides in pertinent part:

Commercial cargo loaded on or unloaded from a commercial vessel is subject to a port use fee of 0.125 percent (.00125) of its value if the loading or unloading occurs at a port within the definition of this section, unless exempted under paragraph (c) of this section . . .

19 CFR 24.24(e)(3)(i) provides that the importer of the cargo is liable for the HMF at the time of unloading. See also 26 U.S.C. 4461(c)(1)(A). Pursuant to 19 U.S.C. 1484, GNSS entered the merchandise as the importer of record. GNSS also posted a continuous bond on a CF 301 as principal for the subject entry. Therefore, GNSS is liable for the HMF as the importer. See also HQ 225317 (October 25, 1994).

Among the exemptions to the HMF is section 24.24(c)(7) which provides that the cargo of any agency or instrumentality of the United States is not subject to the HMF. 26 U.S.C. 4462(e), the specific statutory provision under which section 24.24(c)(7) was promulgated, states "[n]o tax shall be imposed under this subchapter on the United States or any agency or instrumentality thereof." GNSS is not an agency or instrumentality of the U.S., but is organized and exists under the laws of Switzerland. GNSS claims that the subject uranium falls within the subject exemption because it is moving under a DOE contract for delivery to the USEC. However, neither the DOE nor USEC is the importer of the subject uranium. Thus, they are not the parties liable for payment of the HMF pursuant to 26 U.S.C. 4461(c)(1)(A) and 19 CFR 24.24(e)(3)(i). Inasmuch as GNSS alone is liable for payment of the HMF, no tax is being imposed on either the DOE or USEC in this instance. Consequently, both the exemption to the HMF in section 24.24(c)(7) and the bar to tax imposition in section 4462(e) are inapplicable to GNSS.

HOLDING:

The protest is denied. The subject uranium imported by GNSS is not exempt from liability for the HMF pursuant to 19 CFR 24.24(c)(7) or 26 U.S.C. 4462(e).

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, 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 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, Freedom of Information Act and other public access channels.

Sincerely

John Durant, Director
Commercial Rulings Division

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