HQ 111321: Vessel Repair; Cleaning; Inspection; Access to Repairs; M/V MARINE PRINCESS V-42; Entry No. C20-0026947-5; 19 U.S.C. 1466.

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 111321

                        February 19, 1991


VES-13-07/18  CO:R:IT:C  111321  JBW

CATEGORY:  Carriers

Deputy Assistant Regional Commissioner
Commercial Operations
c/o Regional Commissioner
New Orleans, LA 70130-2341

RE:  Vessel Repair; Cleaning; Inspection; Access to Repairs; M/V
     MARINE PRINCESS V-42; Entry No. C20-0026947-5; 19 U.S.C.
     1466.

Dear Madam:

     This letter is in response to your memorandum of September
25, 1990, which forwards for our review and ruling the above-
referenced application for relief from the assessment of vessel
repair duties.

FACTS:

     The record reflects that the subject vessel, the MARINE
PRINCESS, arrived at the port of New Orleans, Louisiana, on May
26, 1990.  Vessel repair entry, number C20-0026947-5, was filed
on the same day as arrival and indicated foreign shipyard work.
The vessel owner filed an application for relief on July 20,
1990.  The application requests relief for numerous invoice
items; you have requested that we address the following issues.

ISSUES:

     (1)  Whether costs for cleaning are dutiable under 19 U.S.C.
1466 (1988) if such costs are attributable to both dutiable
repairs and non-dutiable inspections where such costs are not
segregated.

     (2)  Whether costs for accessing dutiable repairs are
dutiable.

     (3)  Whether costs for tests performed to ascertain whether
dutiable repairs were properly made are dutiable.

LAW AND ANALYSIS:

     Title 19, United States Code, section 1466, provides in
pertinent part for payment of duty in the amount of fifty percent
ad valorem on the cost of foreign repairs to vessels documented
under the laws of the United States to engage in foreign or
coastwise trade, or vessels intended to engage in such trade.

     The applicant claims that certain costs for cleaning, which
appear on the Sembawang Shipyard invoice, are not dutiable.  The
Customs Service has consistently held that cleaning is not
dutiable unless it is performed as part of, in preparation for,
or in conjunction with dutiable repairs, which includes painting
and coating, or is an integral part of the overall maintenance of
the vessel. E.g., Headquarters Ruling Letter 110841, dated May
29, 1990 (and cases cited therein).  Moreover, where dutiable
and non-dutiable costs are not segregated within an invoice item,
all of the charges in that invoice item must be deemed dutiable.
Headquarters Ruling Letter 108567, dated September 10, 1986.
Costs for cleaning that have no nexus to repairs must be
separately itemized to avoid duty.

     The following cleaning costs appear on the Sembawang
Shipyard invoice with other costs for repairs.  From the invoice
and the contractor's specifications, we are unable to determine
whether or not these costs are wholly attributable to non-
dutiable work; we therefore find these cleaning costs to be
dutiable:

     Item D-30:          Tailshaft After Seal
     Item E-4:           Air Intake Valves
     Item E-5:           Main Engine Fuel Injectors
     Item E-8:           Main Engine Fuel Pumps
     Item E-25A-E:       Heat Exchangers
     Item E-28:          Centrifugal Pumps
     Item E-29:          Alternator Cleaning
     Item E-31:          Switchboard, Controllers and Generators
     Item H-10:          Deck House Coating and Blasting

     We have held that cleaning in preparation for cement washing
is dutiable.  C.I.E. 18/48.  Consequently, cleaning costs for
Sembawang Shipyard invoice number E-27 are also dutiable.

     Two items appearing on the Sembawang Shipyard invoice
indicate that costs were incurred for the removal and replacement
of parts of the ship in order to access dutiable repairs.  These
costs, the applicant contends, are not dutiable.  We have held,
however, that where accessing work is integral to dutiable
repairs, then the accessing work is itself dutiable.
Headquarters Ruling Letter 108366, dated March 4, 1987.  Items D-
28 (Cargo Hold Bilge Piping) and E-9 (Main Engine Rotary Exhaust
Valves) show costs for accessing dutiable work.  We therefore
find these costs to be dutiable.

     The applicant claims that testing performed in conjunction
with dutiable repairs made to the main engine air coolers
(Sembawang Shipyard invoice no. E-7) and that ultrasonic gauging
made in conjunction with steel repairs are not dutiable.
Customs has held that inspections not resulting in repairs are
not dutiable.  Headquarters Ruling Letter 110395, dated
September 7, 1989; see American Viking Corp. v. United States, 37
Cust. Ct. 237, 247, C.D. 1830 (1956).  However, where an
inspection is performed to ascertain whether repairs were
properly performed, then those inspection costs are dutiable
regardless of the nature of the inspection.  C.I.E. 429/61;
C.S.D. 79-2, 13 Cust. B. & Dec. 993 (1979).  We find that
inspections performed as part of these two tests are dutiable.

     As part of your memorandum, you state that the drydocking
specifications call for the application of a preservative coating
to the anchor chains (Item D-6) and that this work should be
dutiable.  While we agree with your substantive analysis, we note
that the invoice states that, for this item, the specifications
were cancelled as written, and the work was carried out as
described in the invoice.  The invoice does not indicate that the
coating of the anchor chains was performed.  We thus conclude
that the work performed as part of this item is non-dutiable.

     Finally, the vessel owner seeks relief for certain items
listed on the American Bureau of Shipping invoice #644857.
Included among the charges listed is a charge for $250 for
expenses.  Because some of the costs listed on the invoice are
dutiable, the cost for expenses must be segregated between the
dutiable and the non-dutiable charges.  Since these charges are
not segregated, the entire amount is dutiable.

HOLDINGS:

     (1)  Cleaning is not dutiable unless it is performed as part
of, in preparation for, or in conjunction with dutiable repairs,
which includes painting and coating, or is an integral part of
the overall maintenance of the vessel.  Costs for cleaning must
be properly segregated to avoid duty consequences for cleaning
costs related to non-dutiable work.  The costs for cleaning, as
outlined above, are therefore dutiable.

     (2)  Where accessing work is integral to dutiable repairs,
then the accessing work is itself dutiable. Costs for accessing
dutiable repairs appearing in Sembawang Shipyard items D-28 and
E-9 are therefore dutiable.

     (3)  Where an inspection is performed to ascertain whether
repairs were properly performed, then those inspection costs are
dutiable regardless of the nature of the inspection.  Tests
performed as part of Sembawang Shipyard invoice item E-7 and the
Shin Toyo Engineering appear to be in the nature of inspections
performed to ascertain whether dutiable repairs were properly
performed and are consequently dutiable.

     Finally, we determine from the facts presented that a
preservative coating was not applied to the anchor chains.  This
item (Sembawang Shipyard Invoice Item D-6) is not dutiable.  We
find, however, that non-segregated expenses appearing on the
American Bureau of Shipping invoice #644857 are dutiable.


                              Sincerely,



                              B. James Fritz
                              Chief
                              Carrier Rulings Branch