VES-13-18-CO:R:IT:C 111758 RAH
Deputy Assistant Regional Commissioner
Commercial Operations Division
423 Canal Street
New Orleans, Louisiana 70130-2341
RE: Vessel Repair; 19 U.S.C. 1466; Casualty; Seaworthiness
Dear Sir:
This is in response to your memorandum of June 13, 1991,
regarding vessel repair entry number C20-0029780-7.
FACTS:
The record reflects that the ROBERT E. LEE, voyage 59,
arrived at the port of New Orleans on January 21, 1991. Vessel
repair entry number C27-0029780-7 was filed on January 24, 1991,
reflecting foreign work performed to the vessel in Suez, Egypt,
and Valletta, Malta.
The vessel was grounded in the Suez Canal on September 29,
1990. She underwent temporary repairs and then proceeded to
Valletta, Malta for further repairs.
The subject of this ruling is an application for relief
dated May 3, 1991. You specifically seek our advice on the
applicant's claim for remission due to casualty. You state that
the grounding is well documented and the existence of a casualty
is not in issue. However, after the immediate temporary repairs
in Suez, Egypt, the vessel sailed over 1,300 miles to Malta where
permanent repairs were undertaken. After the repairs in Malta,
the vessel sailed back to Egypt before returning to the United
States. You are concerned that the repairs made to the vessel in
Malta were not necessary for the safety and seaworthiness of the
vessel to enable it to reach its port of destination.
- 2 -
ISSUE:
Whether evidence is presented sufficient to prove that the
foreign repairs performed on the vessel for which relief is
sought, were necessary for its safety and seaworthiness thus
warranting remission pursuant to 19 U.S.C. 1466(d)(1).
LAW AND ANALYSIS:
Title 19, United States Code, section 1466, provides in part
for payment of an ad valorem duty of 50 percent of the cost of
foreign repairs to vessels documented under the laws of the
United States to engage in the foreign or coastwise trade, or
vessels intended to engage in such trade. Section 1466(d)(1)
provides that the Secretary of the Treasury is authorized to
remit or refund such duties if the owner or master of the vessel
was compelled by stress of weather or other casualty to put into
such foreign port to make repairs to secure the safety and
seaworthiness of the vessel to enable her to reach her port of
destination.
It is noted that section 4.14(c)(3)(i), Customs Regulations
(19 CFR 4.14(c)(3)(i)), provides that "port of destination" means
such port in the United States. This point is not in dispute,
however, it is an embellishment upon section 1466(d)(1) which
sets forth the following three-part test which must be met in
order to qualify for remission:
1. The establishment of a casualty occurrence.
2. The establishment of unsafe and unseaworthy conditions.
3. The inability to reach the port of destination without
obtaining foreign repairs.
In addition, if the above requirements are satisfied by
evidence, the remission is restricted to the cost of the minimal
repairs necessary to enable the vessel to reach her port of
destination. Repair costs beyond that minimal amount are not
subject to remission. In the case under consideration, the
evidence supports the claim that the subject vessel suffered a
marine casualty. The extent of that casualty is, however, the
critical issue upon which this case turns.
The applicant has submitted an American Bureau of Shipping
report dated October 12, 1990, which provides in part that
[after temporary repairs are completed] the surveyor "considers
this vessel fit to proceed in ballast condition at reduced speed
from Suez, Egypt via Suez Canal to the available Mediterranean or
European Port (Atlantic or Indian Ocean not to be considered)
for drydocking...." Additionally, a Salvage Association report
- 3 -
dated November 12, 1990 (report no. 458/90) provides in part:
"SCA Salvage Dept divers reported damage to
be more extensive than previously advised.
Now found to extend from the after end of No.
2 Double double bottom tank (Fr. 82) through
to the bulbous bow a total distance of about
380 ft and extending over the falt bottom.
They also reported that it was possible to
carry out under water temporary repairs to
the Fore Peak and Fuel tanks. Temporary
repairs of other tank openings was
impractical and unlikely to be effective.
In that report the SCA set forth four criterion for the
vessel to transit the canal:
A) Fuel Oil in damaged tanks to be off loaded.
B) Fore peak and damaged fuel oil tank to be closed and
made watertight.
C) Vessel to be not deeper than its present draft (23 ft)
i.e. the barges discharged during the salvage operation
could not be reloaded.
D) An escort tug to be provided for the canal transit.
Again, the term "seaworthy" is admittedly relative. Whether
a boat is seaworthy to traverse a pond, or a merchant vessel to
voyage the northern Atlantic Ocean in mid-winter, are questions
which involve disparate considerations. But as a practical
matter questions of seaworthiness must often fall within limited
factual circumstances which preclude such far-reaching
speculations. We consider whether a particular ship with a
particular mission is seaworthy in terms of accomplishing that
mission and as to which recognized authorities exist that will
aid us in making that determination. Our focus in issuing
rulings must be toward narrowing questions rather than presenting
or accepting the central issues in such a way as to preclude
definable considerations.
To pursue the foregoing thought and try to decide the
subject application within the framework of definable criteria,
it is appropriate to apply whatever formal, precedential
guidelines that exist. This of course would include any
applicable procedures. In this case, one existent procedure is
squarely on point.
Pursuant to 2.01-15, U.S. Coast Guard (USCG) Regulations
(46 CFR 2.01-15) a vessel may not proceed from one port to
- 4 -
another for repairs unless prior authorization is obtained from
the USCG Officer in Charge, Marine Inspection (OCMI) either
through the issuance of a USCG "Permit to Proceed to Another Port
for Repairs" (CG-948) or a CG-835 which would specify the
restrictions on, and duration of, any voyage undertaken prior to
obtaining permanent repairs. (see also 46 CFR 31.10-25 regarding
tank vessels which provides, inter alia, that "No extensive
repairs to the hull or machinery which affect the safety of a
vessel shall be made without the knowledge of the Officer in
Charge, Marine Inspection.") Other than the USCG Report of
Accident, the record contains no USCG documentation of any kind.
The assertions of the ABS and the Salvage Association are
not of equally probative value with an official USCG
determination as to the vessel's fitness, not only because
federal regulations provide for evidence that permits an
expeditious resolution of the question of seaworthiness but
because mere assertions of interested parties have been
substituted for that disinterested finding. The applicant has
not met a burden of proof that is provided for by federal
regulations. The controlling agency that determines questions of
fitness to proceed is the USCG which is not empowered to assign
this responsibility to a private organization (i.e., the ABS,
which is a surveying society the primary purpose of which is to
determine whether, for insurance purposes, a vessel will remain
in class). The USCG regulations, which have the force and effect
of law, require a vessel operator to prove certain facts to the
federal government; that was not done.
Accordingly, in the absence of any determination of the USCG
regarding the subject vessel's safety and seaworthiness, and
absent the evidence that would be adduced by the required USCG
determination on the issue of seaworthiness, the applicant has
failed to substantiate its claim for remission under 1466(d)(1).
HOLDING:
The evidence presented is not sufficient to prove that the
foreign repairs performed on the subject vessel for which relief
is sought were necessary for its safety and seaworthiness
therefore remission pursuant to 19 U.S.C. 1466(d)(1) is denied.
Accordingly, the application is denied.
Sincerely,
B. James Fritz
Chief
Carrier Rulings Branch