HQ H018274 - Vessel equipment temporarily unladen for repair; 19 U.S.C. § 1446; 19 C.F.R. § 4.39(g)(2007); 65 Fed. Reg. 56788(Sept. 20, 2000); entry of merchandise; 19 C.F.R. §§ 141.4(a) and 142.3(a) and (b). - United States International Trade Commision Rulings

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HQ H018274

December 17, 2007

VES-5-OT:RR:BSTC:CCI H018274 LLB

CATEGORY: CARRIER

Aaron Gothelf, Esquire
BP America, Inc.
4101 Winfield Road
Warrenville, Illinois 60555

RE: Vessel equipment temporarily unladen for repair; 19 U.S.C. § 1446; 19 C.F.R. § 4.39(g)(2007); 65 Fed. Reg. 56788(Sept. 20, 2000); entry of merchandise; 19 C.F.R. §§ 141.4(a) and 142.3(a) and (b).

Dear Mr. Gothelf:

This letter is response to your ruling request of October 10, 2007. In your request, you inquire about the entry and bonding procedures for vessel equipment temporarily unladen for repair. Our decision follows.

FACTS

BP has equipment aboard its vessels which occasionally are in need of repair. BP proposes to unlade the equipment for repair temporarily and then have the same vessel relade the repaired equipment at a later time.

ISSUES

Whether a temporary importation bond is required for vessel equipment that is temporarily unladen for repair.

Whether entry is required for vessel equipment that is temporarily unladen and if so, whether filing a CF 3171 and International Carrier Bond are sufficient to meet entry requirements.

Whether a vessel that temporarily unlades equipment for repair must stay in port while such repairs are being made.

LAW and ANALYSIS

Issue 1

You inquire whether vessel equipment unladen temporarily for repair must be entered under a temporary importation bond. Pursuant to 19 U.S.C. § 1446, in pertinent part:

Vessels arriving in the United States from foreign ports may retain on board, without the payment of duty, all coal and other fuel supplies, ships' stores, sea stores, and the legitimate equipment of such vessels. Any such supplies, ships' stores, sea stores, or equipment landed and delivered from such vessel shall be considered and treated as imported merchandise . . .

(emphasis added). However, under the regulations promulgated under the authority of 19 U.S.C. § 1446:

Equipment of a vessel arriving either directly or indirectly from a foreign port or place, if in need of repairs in the United States, may be unladen from and reladen upon the same vessel under the procedures set forth in § 4.30 relating to the granting of permits and special licenses on Customs Form 3171 (CF 3171). Adequate protection of the revenue is insured under the appropriate International Carrier Bond during the period that equipment is temporarily landed for repairs (see § 113.64(b) of this chapter), and so resort to the procedures established for the temporary importation of merchandise under bond is unnecessary. Once equipment which has been unladen under the terms of a CF 3171 has been reladen on the same vessel, potential liability for that transaction existing under the bond will be extinguished.

19 C.F.R. § 4.39(g)(2007)(emphasis added); see also Vessel Equipment Temporarily Landed for Repair: Final Rule, 65 Fed. Reg. 56788, 56789 (Sept. 20, 2000).

You propose to unlade and relade upon the same vessel, equipment in need of repair. As such, according to the plain language of 19 C.F.R. § 4.39(g), a “temporary importation of merchandise under bond is unnecessary.”

Issue 2

You also inquire whether the equipment under consideration is subject to merchandise entry requirements. Pursuant to 19 C.F.R. § 141.4(a), “[a]ll merchandise imported into the United States is required to be entered, unless specifically excepted.” The exceptions are noted under 19 C.F.R. § 141.4(b) and are as follows:

1) Exemptions listed in General Note 3(e) of HTSUSA ; 2) Vessels;
3) Instruments of international traffic; and 4) Railway locomotives and freight cars under certain provisions of HTSUSA Chapter 86.

We note that pursuant to 19 C.F.R. § 141.0, the provisions under 19 C.F.R. § 141 apply to imported merchandise, with specific exceptions noted for merchandise entered under carnet, merchandise entered under bond for transportation, merchandise designated for a foreign trade zone, and merchandise for use at a trade fair, none of which are relevant under the facts presented in this ruling.

We find that none of the exceptions specifically noted in 19 C.F.R. § 141.4(b) is applicable in this case. As such, BP would be required to enter the temporarily unladen vessel equipment. The remaining question is whether filing the CF 3171 and the International Carrier Bond required by 19 C.F.R. § 4.39, as described in Issue 1 above, is sufficient to meet the entry requirements in 19 C.F.R. § 142, et. seq.

By its regulatory history cited herein, 19 C.F.R. § 4.39(g), was created specifically to address vessel equipment temporarily unladen for repair and allows for adequate Customs control over the merchandise as well as protection of the revenue. As such, we have determined that the CF 3171 and the International Carrier Bond, filed pursuant to § 4.39(g), should be accepted by the port in lieu of a CF 7501, entry documentation required by 19 C.F.R. § 142.3(a) and (b), and the basic entry and importation bond required by § 142.19(a). Insofar as we have determined that formal entry would be required, we do not reach whether informal entry would be required.

Issue 3

You inquire whether the vessel that unlades the vessel equipment pursuant to 19 C.F.R. § 4.39(g), must remain at the port while the repairs are being made. The relevant CBP statutes and regulations that impose no such requirement. The fact the CF 3171 requires the carrier to provide its itinerary for the vessel’s entire voyage, including the U.S. itinerary, is an indication that there is an expectation the vessel will be departing once the equipment is unladen and that same itinerary would be an indication as to when the vessel equipment for repair would be reladen upon the same vessel. Based on the foregoing, a vessel that unlades vessel equipment pursuant to 19 C.F.R. § 4.39(g), is not required to remain at the port while the repairs to the equipment are being made.

HOLDING

1. Pursuant to 19 C.F.R. § 4.39(g), a temporary importation bond is not required for vessel equipment that is temporarily unladen for repair.

2. Although formal entry is required for vessel equipment that is temporarily unladen for repair, the carrier may file a CF 3171 and an International Carrier Bond, pursuant to § 4.39(g), in lieu of a CF 7501 and entry documentation required by 19 C.F.R. § 142.3(a) and (b), and the basic entry and importation bond required by § 142.19(a).

3. A vessel that unlades vessel equipment pursuant to 19 C.F.R. § 4.39(g), is not required to remain at the port while the repairs to the equipment are being made.

Sincerely,

Glen E. Vereb

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