HQ 544303: Calculation of user fees for petroleum products.

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 544303

                                   March 27, 1989


          CLA-2 CO:R:C:V 544303

          CATEGORY: Other

          Mr. T. N. Pockman
          Manager, Regulatory
           and Administrative Compliance
          Mobil Oil Corporation
          3225 Gallows Road
          FairFax, Virginia 22037-0001

          RE:  Calculation of user fees for petroleum products.

          Dear Mr. Pockman:


               Your letters dated April 13, 1988, and January 16, 1989,
          have been forwarded to this office for response.  Please accept
          our apologies for the delay in responding to your inquiry.

          FACTS:

               You state that you have received invoices for petroleum
          products from the Philadelphia District for increases in the
          harbor maintenance tax and the merchandise processing fee which
          have been recomputed on the total dollar amount of your foreign
          purchase invoice.  You contend that this final commercial invoice
          should be used to establish a unit value for your purchase which
          should then be applied to the actual gross receipt - the volume
          of cargo on which duty is paid.  You have stated that due to the
          measurement inaccuracies at loading and various sources of
          operational losses that occur in shipment and handling, the
          volume actually received is typically a few tenths of a percent
          less than the volume invoiced by your supplier.

          ISSUE:

               Whether section 158.7 of the Customs Regulations (19 CFR
          158.7) should be taken into account in determining the
          appropriate user fee promulgated in sections 24.13 and 24.14 of
          the Customs Regulations (19 CFR 24.13 and 24.14).

          LAW AND ANALYSIS:

               Section 158.7 of the Customs Regulations (19 CFR 158.7)
          provides:












                                        - 2 -

                   "Merchandise subject to ad valorem, specific, or
                   compound rates of duty found at the time of importation
                   to be reduced or diminished by a natural force, such as
                   evaporation, or by leakage, shall be appraised in its
                   condition as imported, with an allowance made in the
                   value, weight, quantity, or measure to the extent of the
                   reduction or loss, except where forbidden by law or
                   regulation."

               Consideration of this provision must take into account
          section 24.23(a) of the Customs Regulations (19 CFR 24.23(a)).
          Section 24.23 promulgates the user fee statute pursuant to
          section 8101(a) of the Omnibus Budget Reconciliation Act of 1986
          (19 U.S.C. 58) which provides that the user fee shall be based on
          the value of the merchandise.  Subsection (c) provides that the
          fee shall be due and payable to Customs by the importer of record
          of merchandise at the time of deposit of estimated duties.

               Accordingly, under the procedure explained to you by the
          national import specialist, Customs bases its appraised value on
          the transaction value of the imported merchandise as declared by
          the importer at the time of entry.  It is this figure which
          Customs uses for all purposes required by law including the
          establishment of user fees.  If this figure changes based on an
          adjustment between the parties prior to importation then it
          becomes incumbent upon the importer to amend his entry
          declaration.  Absent an amendment of the entry by the importer,
          we have no authority under 19 CFR 158.7, or elsewhere to, change
          the appraised value of the imported merchandise.

          HOLDING:

               The adjustment to the appraised value required by 19 CFR
          158.7 must take into account the provisions of 19 CFR 24.23 and
          24.24.  Accordingly, unless the importer makes an adjustment
          (amendment) to the value declaration on Customs Form 7501, both
          user fees will be calculated on the basis of the values declared
          to Customs.

                                      Sincerely,




                                      John A. Durant, Director
                                      Commercial Rulings Division
















          cc: CLA- CO:R:C:V:TLL: MM:FNL 3-9-89