VES-5-08-RR:IT:EC 113783 GOB
A. X. Soto
Soto Customs Service Inc.
P.O. Box 4199
Brownsville, Texas 78523-4199
RE: Harbor Maintenance Fee; 26 U.S.C. 4461, 4462; 19 CFR 24.24
Dear Mr. Soto:
This is in response to your letter of December 4, 1996.
FACTS:
You state as follows:
A vessel (semi-submersible rig) built in Japan in the year
1978, registered in the Bahamas, and owned by Transocean
Offshore, Inc. of Houston, TX 75252 was loaded aboard a
submersible vessel in Singapore to be transported to
Brownsville, TX. This operation was executed due to time
savings in transit utilizing the above mentioned method.
Upon arrival and clearance of said rig at Brownsville, TX.
it will be entered into Foreign Trade Zone (FTZ) No. 62 for
repairs and modifications. After the above mentioned
operations are performed on said rig, it will be cleared for
a foreign destination.
Since the vessel (rig) meets requirements as prescribed by
section 4 and exemptions as noted in section 24.24 of the
U.S. Customs Regulations, it is our belief that HMF should
not be applicable.
ISSUE:
Whether the harbor maintenance fee is applicable in the
above-described situation.
LAW AND ANALYSIS:
Title 26, United States Code, 4461 and 4462, provide for
the imposition of the HMF, including special rules regarding its
administration. Specifically, the applicable statutory
authority, as amended, provides in pertinent part as follows:
Section 4461. Imposition of Tax
(a) General rule.--There is hereby imposed a tax
on any port use. (b) Amount of tax.--The amount of
the tax imposed by subsection (a) on any
port use shall be an amount equal to 0.125 percent of the value of the commercial cargo involved. (c) Liability and time of imposition of
tax.-- (1) Liability.--The tax
imposed by subsection (a) shall be paid by--
(A) in the case of cargo entering the
United States, the importer,... * * * Section 4462. Definitions and
Special Rules.
(a) Definitions.--For purposes of this
subchapter-- (1) Port Use.--The term
port use' means-- (A) the loading
of commercial cargo on, or (B) the
unloading of commercial cargo from,
a commercial vessel at a port. * * *
(3) Commercial Cargo.--
(A) In General.--The term commercial
cargo' means any cargo transported on
a commercial vessel,..." * * *
The applicable regulatory authority promulgated by Customs
pursuant to 26 U.S.C. 4462(h) to implement the above statutory
provisions is found in 24.24, Customs Regulations (19 CFR
24.24). Specifically, 24.24 provides, in pertinent part:
(a) Fee. 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...
(b) Definitions. For the purpose of this section:
...
(2)Commercial cargo means, unless exempted by
paragraphs (c)(1) and (2) of this section,
merchandise transported on a commercial
vessel...Whenever the term "cargo" is used, it means merchandise, but not passengers.
In your letter, you reference the "...exemptions as noted in
section 24.24 of the U.S. Customs Regulations..." and you state
"...it is our belief that HMF should not be applicable."
However, you do not identify which exemption you may be referring
to.
Based on the facts presented, it is our determination that
the harbor maintenance fee applies in the situation described.
There is no exemption therefrom which would appear to apply.
We call to your attention 19 CFR 24.24(e)(3)(i), which
provides:
(e) Collections -
...
(3) Import vessel movements-(i) Time and place of liability.
Subject to the exemptions and special rules of this section,
when imported cargo is unloaded from a commercial vessel at
a port within the definition of this section, and destined
for either consumption, warehousing, or foreign trade zone
admission, the importer of that cargo, or in the case of
foreign trade zones, the person or corporation responsible
for bringing merchandise into the zone, is liable for
payment of the port use fee at the time of unloading. The
fee is based on the U.S. Customs appraised value of the
shipment pursuant to 19 U.S.C. 1401a, the same basis as that
used for duty payment. The fee shall be collected on all
formal entries, including warehouse entries and temporary
importation under bond entries, and admissions into foreign
trade zones.
HOLDING:
The harbor maintenance fee applies to the transaction
described in your letter.
Sincerely,
Chief,
Entry and Carrier Rulings Branch