HQ 115170 - Protest No. 5301-00-100187; Vessel Repair Entry No. C53- 0028021-7; M/V RICHARD G. MATTHIESEN; V-154; Interest; 19 U.S.C. §§ 1466, 1505(c) - United States International Trade Commision Rulings

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HQ 115170

April 10, 2002

VES-13-18-RR:IT:EC 115170 GEV

CATEGORY: CARRIER

Chief, Vessel Repair Unit
U.S. Customs Service
423 Canal Street
New Orleans, Louisiana 70130

RE: Protest No. 5301-00-100187; Vessel Repair Entry No. C53- 0028021-7; M/V RICHARD G. MATTHIESEN; V-154; Interest; 19 U.S.C. §§ 1466, 1505(c)

Dear Sir:

This is in response to your memorandum dated September 28, 2000, forwarding for our review the above-referenced protest. Our ruling on this matter is set forth below.

FACTS:

The M/V RICHARD G. MATTHIESEN is a U.S.-flag vessel operated by Ocean Ships, Inc., of Houston, Texas. During the voyage in question, this vessel incurred foreign repair expenditures. A vessel repair entry was filed at the port of Houston on March 15, 1995. A cash deposit for estimated duties in the amount of $234,500.00 was paid on March 21, 1995.

In Customs responses to the application for relief and the petition for review of the above-referenced entry, Customs held that certain costs were subject to duty under the vessel repair statute (19 U.S.C. § 1466). By your letter dated February 7, 2000, in response to the petition for review, the petitioner was informed that the duty amount was $115,287.59 and the amount to be refunded was $119,212.41. However, due to a clerical error which occurred when Customs liquidated the entry on April 28, 2000, those two amounts were switched and the liquidation indicated that the duty amount was $119,212.41 and refund amount was $115,287.59. Thus, because of this error, Customs sent the petitioner a refund check for the smaller
amount and not the amount of $119,212.41 to which it was entitled. This error in Customs liquidation of this entry resulted in an underpayment of the refund in the amount of $3,924.82. Customs acknowledged this clerical error and the entry was subsequently reliquidated on June 6, 2000, to provide for the issuance of an additional refund of excess duties in the amount of $3,924.82.

Customs liquidation of the subject entry, however, did not authorize the payment of interest on the excess monies overpaid to Customs. Consequently, a protest with supporting documentation was timely filed on July 13, 2000. The protestant’s sole claim is that interest is owed it on this excess amount.

ISSUE:

Whether the protestant is entitled to interest on the excess monies refunded by Customs in conjunction with the overpayment of duty on the above-referenced vessel repair entry pursuant to 19 U.S.C.

LAW AND ANALYSIS:

Title 19, United States Code, § 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..."

With respect to the protestant’s claim, it should be noted that although the Customs office charged with administration of 19 U.S.C. § 1466 is the Entry Procedures and Carriers Branch of the Office of Regulations and Rulings (OR&R), whether vessel repair entries filed pursuant to that statute are subject to the interest provisions of 19 U.S.C. § 1505 is a matter within the purview of the Duty and Refund Determination Branch of OR&R. Upon seeking the position of that branch with respect to this issue, their memorandum no. 229128 RDC, dated December 10, 2002, determined that vessel repair entries are not subject to interest pursuant to 19 U.S.C. § 1505(c).

Accordingly, the protestant is not entitled to interest on the excess monies deposited with Customs in conjunction with the above-referenced vessel repair entry pursuant to 19 U.S.C. § 1505(c).

HOLDING:

The protestant is not entitled to interest on the excess monies refunded by Customs in conjunction with the overpayment of duty on the above-referenced vessel repair entry pursuant to 19 U.S.C.

The protest is denied in accordance with the Law and Analysis portion of this ruling.

In accordance with § 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, 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 this decision must be accomplished prior to mailing this decision. Sixty days from the date of the decision, the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.gov, by means of the Freedom of Information Act, and other methods of public distribution.

Sincerely,

Georgina Grier

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