VES-13-18-RR:IT:EC 115100 GEV
Chief, Residual Liquidation and Protest Branch
U.S. Customs Service
6 World Trade Center
New York, New York 10048-0945
RE: Vessel Repair Entry No. WK9-0064830-4; M/V SEA-LAND INTEGRITY;
V-550; Travel and Allowance Charges; 19 U.S.C. § 1466
Dear Sir:
This is in response to your memorandum dated July 7, 2000, forwarding a
petition for review of your ruling on an application for relief from duties
assessed pursuant to 19 U.S.C. § 1466. Our findings are set forth below.
FACTS:
The M/V SEA-LAND INTEGRITY is a U.S.-flag vessel owned by U.S. Ship
Management, Inc., of Charlotte, North Carolina. Subsequent to the
completion of foreign shipyard work, the vessel arrived in Boston,
Massachusetts, on March 15, 2000. A vessel repair entry was timely filed.
An application for relief with supporting documentation was timely filed.
Pursuant to a letter dated May 19, 2000, the Chief, Residual Liquidation and
Protest Branch, New York, N.Y., denied in full the aforementioned
application. A petition for review of this decision was timely filed seeking
relief with respect to travel and allowance charges listed on Wartsila NSD
invoice no. 802168 incurred pursuant to an engineer attending the vessel to
“troubleshoot engine control system.”
ISSUE:
Whether the travel and allowance charges for which the petitioner seeks
relief are dutiable pursuant to 19 U.S.C. § 1466.
- 2 -
LAW AND ANALYSIS:
Title 19, United States Code, § 1466, 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..."
In regard to the travel and allowance charges at issue, the petitioner does not dispute the fact that these costs were incurred pursuant to dutiable repairs. Rather, the petitioner’s sole claim for relief is that, "We feel travel and allowances are not actually labor performed on or materials used on the vessel and they should be excluded from Customs duties."
While the petitioner’s statement at one time reflected Customs position with respect to such charges, pursuant to the decision of the U.S. Court of Appeals for the Federal Circuit (CAFC) in Texaco Marine Services, Inc., and Texaco Refining and Marketing, Inc., v. United States, 44 F.3d 1539 (1994), it no longer represents Customs position in this matter. (See also Customs memorandum 113308, dated January 18, 1995, published in the Customs Bulletin on February 8, 1995 (Customs Bulletin and Decisions, vol. 29, no. 6, at p. 59), as clarified in Customs memorandum 113350, dated March 3, 1995, published in the Customs Bulletin on April 5, 1995 (Customs Bulletin and Decisions, vol. 29, no. 14, at p. 24)). Furthermore, it should be noted that in post-Texaco vessel repair entries such as the one
currently under consideration, Customs has held such charges incurred pursuant to dutiable repair work to be dutiable. (Customs ruling letter 114006, dated November 13, 1997)
Accordingly, the travel and allowance charges in question are dutiable.
HOLDINGS:
The travel and transportation charges for which the petitioner seeks relief are dutiable pursuant to 19 U.S.C. § 1466.
- 3 -
Accordingly, the petition is denied in full.
Sincerely,
Larry L. Burton
Chief
Entry Procedures and Carriers Branch