HQ 544215: Dutiability of $5 Customs fee for the processing of commercial trucks arriving in the U.S.

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 544215

                                   August 11, 1988


          CLA-2 CO:R:C:V  544215 CW

          CATEGORY:  Valuation

          Mr. William C. Cain
          Cain Customs Brokers, Inc.
          Progreso International Bridge
          P.O. Box 10
          Progreso, Texas 78579

          RE:  Dutiability of $5 Customs fee for the processing of
               commercial trucks arriving in the U.S.

          Dear Mr. Cain:

               This is in response to your letter of June 30, 1988, in
          which you request a ruling concerning the dutiability of the $5
          fee payable to the Customs Service for services provided in
          connection with the arrival of a commercial truck.

          FACTS:

               You state that you represent several growers of fresh okra
          in Mexico who have entered into contracts with U.S. freezing
          plants for the purchase of okra on a fixed price per pound basis.
          The contracts provide that for the growers to receive the
          purchase price, they must deliver the okra to the purchasers'
          facilities in the U.S.  You advise that in delivering the okra to
          the U.S. purchasers, the growers are required to pay the $5
          Customs processing fee upon the arrival of each truck at the U.S.
          port of entry.  Under these circumstances, you maintain that the
          $5 fee should be deductible from the purchase price as a non-
          dutiable charge in determining the appraised value of the
          imported okra.

          ISSUE:

               Whether the $5 Customs fee collected upon arrival of a
          commercial truck containing fresh okra from Mexico is included in
          the appraised value of the imported okra where the terms of sale
          are CIF U.S. purchaser's plant.     


















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          LAW AND ANALYSIS:

               Section 13031 of the Consolidated Omnibus Budget
          Reconciliation Act of 1985 (Pub. L. 99-272) establishes a
          schedule of fees chargeable to users of various services provided
          by the Customs Service in connection with the processing of
          persons, aircraft, vehicles, vessels, and merchandise arriving in
          the U.S.  Section 13031(a)(2) of Pub L. 99-272 specifically
          authorizes Customs to collect $5 upon the arrival of a commercial
          truck at a U.S. port of entry.  Section 24.22(c)(2), Customs
          Regulations (19 CFR 24.22(c)(2)), states that the $5 fee shall be
          collected from the driver or other person in charge of the
          commercial truck.

               We are assuming for purposes of this ruling that the
          imported okra will be appraised on the basis of transaction
          value, the primary basis of appraisement under the valuation
          statute, section 402 of the Tariff Act of 1930, as amended by the
          Trade Agreements Act of 1979 (TAA).  Transaction value is defined
          in section 402(b) of the TAA as "the price actually paid or
          payable for the merchandise when sold for exportation to the
          United States, plus amounts" for certain specified items if they
          are not already included in that price.  The words "price
          actually paid or payable" are defined in section 402(b)(4)(A) of
          the TAA as:

               ...the total payment (whether direct or indirect,
               and exclusive of any costs, charges, or expenses
               incurred for transportation, insurance, and
               related services incident to the international
               shipment of the merchandise from the country of
               exportation to the place of importation in the
               United States) made, or to be made, for imported
               merchandise by the buyer to, or for the benefit
               of, the seller.

               In a ruling dated November 10, 1986 (543842), this office
          addressed the issue of the dutiability of the merchandise
          processing user fee, which is an ad valorem fee established by
          the Omnibus Budget Reconciliation Act of 1986 (Pub. L. 99-509).
          We concluded that where the overall transaction price between the
          buyer and foreign seller for imported merchandise includes the
          user fee, the fee would not be considered to be part of "the
          price actually paid or payable for the merchandise."  Therefore,
          we held that, under these circumstances, the fee would not be
          dutiable as part of transaction value.

               Similarly, we believe that in a situation in which the
          overall purchase price for imported merchandise includes the $5
          Customs fee payable upon the arrival of a commercial truck (e.g.,












                                        - 3 -

          a CIF U.S. delivered price), the fee would not form part of the
          "price actually paid or payable," as those words are defined in
          section 402(b)(4)(A) of the TAA.

          HOLDING:

               Under circumstances in which the terms of sale between a
          Mexican grower and a U.S. purchaser for imported okra require
          that the grower incur all costs necessary to deliver the produce
          to the U.S. purchaser's plant (a CIF U.S. delivered price), then
          the $5 commercial truck processing fee paid by the grower in
          connection with the imported okra would not be dutiable as part
          of transaction value.

                                     Sincerely,




                                     John Durant
                                     Director, Commercial
                                     Rulings Division