ENT-1-01 RR:IT:EC 113985 CC
Robert E. Corrado
V.P. Import Operations
Compass Forwarding Co., Inc.
159-15 Rockaway Blvd.
Jamaica, NY 11434
RE: Importation and installation of fiber optic cable
Dear Mr. Corrado:
This is in response to your letter Of June 11, 1997,
concerning the importation and installation of 3,000 miles of
fiber optic cable which you call the Gemini Project. You state
that the cable will be used for voice and data transmission from
New Jersey to England.
FACTS:
According to your letter, the cable will be imported to New
Jersey on a charter vessel from Australia. At the port in New
Jersey, the cable will be removed by a special crane and put on a
laying vessel, which will be next to it. The laying vessel will
then take the cable approximately 35 miles down the coast to
Manasquin, New Jersey, where the cable will be installed with
approximately 12 miles of cable on land and the balance in the
ocean.
You ask about entry procedures for the cable, and,
particularly, we have been told by the port, any duty
consequences. We note that there was issued recently a ruling
concerning the coastwise trade law issues concerning this
project, Headquarters Ruling (HQ) 113906, dated April 24, 1997.
ISSUE:
Whether the cable is dutiable.
LAW AND ANALYSIS:
All goods imported into the Customs territory of the United
States from outside thereof are subject to duty or exempt thereof
as provided for by the Harmonized Tariff Schedule of the United
States (HTSUS). General Note 1, HTSUS. The term importation is
generally defined as the bringing of goods within the
jurisdictional limits of the United States with the intention to
unlade them." See C.S.D. 89-39, Henry Hollander Co. v. United
States, 22 C.C.P.A. 645, 648 (1935), and United States v. Field &
Co., 14 Ct. Cust. App. 406 (1927). Merchandise arriving on a
vessel is deemed imported on "the date on which the vessel
arrives within the limits of a port in the United States with
intent then and there to unlade such merchandise." See United
States v. Commodities Export Co., 14 CIT 166, 733 F. Supp. 109
(1990) and 19 CFR 101.1.
According to the information provided, the cable is arriving
on a vessel that departed from Australia. The vessel will enter
a port in New Jersey, and the cable will be unladen onto another
vessel. Since the cable arrived on a vessel from a foreign
country, the vessel came within a U.S. port limits, and the cable
was unladen onto another vessel, clearly an importation has
occurred. Consequently, the cable is subject to duty. We have
ruled that cable arriving at a U.S. port on a vessel from a
foreign country and laden on another vessel for cable laying
operations is dutiable. See HQ 111718 of August 12, 1991.
We are unaware of any duty exemption that would apply to the
subject cable. The cable, however, could be placed in either a
Customs bonded warehouse or a foreign trade zone without payment
of duty if the cable is exported. See HQ 224935 of September 17,
1993, and HQ 220924 of June 8, 1989. The portion of the cable
from the three mile territorial limit outward would be considered
exported. Although 19 U.S.C. 1322(a) and 19 CFR 10.41(f)
allow for a duty exemption for certain undersea international
cable as instruments of international traffic, we have found that
the exemption does not apply for cable that is first imported on
a vessel to the United States. See HQ 223692, dated March 11,
1992.
Also, we note that drawback may be available for the cable.
We have found that underwater communications cable is "exported"
for drawback purposes when it is laid between the international
waters of the United States and a foreign country. See HQ 224935
of September 17, 1993, and C.S.D. 81-167. Therefore, if the
cable is laid to the UK, the cable would be considered exported
for drawback purposes and drawback would be available.
Finally, you state that at the time of importation, you have
over one million dollars worth of parts, equipment, tools of
trade, computer, and computer software, which will be returned to
the U.K. We would need more information concerning these items
before we would be able to comment further.
If you have further questions concerning entry procedures,
please address them to the port where you are making entry.
HOLDING:
The cable is imported into the United States and is subject
to duty under the HTSUS at the applicable rate.
Sincerely,
Jerry Laderberg
Acting Chief
Entry and Carrier Rulings Branch