us-cbp-cross-rulings-hq-109666•HQ 109666: Determination of build of an Zodiac inflatable craft of less than 5 net tons when a part of the craft is built abroad.
HQ 109666: Determination of build of an Zodiac inflatable craft of less than 5 net tons when a part of the craft is built abroad.
us-cbp-cross-rulings-hq-109666HQ 109666: Determination of build of an Zodiac inflatable craft of less than 5 net tons when a part of the craft is built abroad.Guidance
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 109666
October 4, 1988
VES 3-23/VES 3-02 CO:R:P:C 109666 BEW
CATEGORY: CARRIERS
Mr. Mark O'Dell
Garden Island Inflatables
2970 C Waapa Road
Lihue, Kauai, Hawaii 96766
RE: Determination of build of an Zodiac inflatable craft of
less than 5 net tons when a part of the craft is built
abroad.
Dear Mr. O'Dell:
This in response to your letter of July 15, 1988,
requesting a ruling that a 23' Zodiac Mark VI HD, HA 828 CP
inflatable craft will be considered built in the United States
for purposes of the coastwise laws, after the modifications and
improvements to the vessel described in the correspondence.
FACTS:
You state that the 23' Zodiac was purchased for $14,280
from Zodiac of North America. You state that the 23' Zodiac
was extensively redesigned by completing the following
reconstructive work:
All seams have been reinforced, the transom was removed,
fiberglassed, reinstalled with heavier duty mounts and
watersealed off.
The thrust board was removed, the underlying seams
reinforced, and heavy duty mounting pads were added to the
boat;
The thrust board was fiberglassed and heavy duty mounts
were built for it, the thrust board was reinstalled and
watersealed off;
Both bow boards were removed, fiberglassed and surfaced
with an anti-skid surface;
- 2 -
The bottom of the transom was triple reinforced to prevent
sand abrasion; and
The speed tubes were dismantled and all structural
attachment points for the speed tubes were reinforced.
In addition, you state that a fiberglass console was built
in Hawaii and installed in the craft, along with twin 70
HP Johnson engines and American steering products
You enclosed documents and invoices showing that the total
cost for the modifications and additions on the hull and
superstructure is $13,674,52. In addition, you state the cost
the U.S. built motors - $6,954; and trailer - 2,380, for a
total reconstruction cost of $22,928.52.
ISSUE:
Is an inflatable foreign-built craft, which has
substantial modifications and additions performed on the hull
and superstructure in the United States sufficiently
substantially modified to be considered a United States-built
vessel for purposes of the coastwise laws.
LAW AND ANALYSIS:
Generally, the coastwise laws prohibit the transportation
of merchandise or passengers between points in the United
States embraced within the coastwise laws in any vessel other
than a vessel built in, documented under the laws of, and owned
by citizens of the United States. The passenger coastwise law,
46 U.S.C. App. 289, provides that:
No foreign vessel shall transport passengers
between ports or places in the United States,
either directly or by way of a foreign port,
under a penalty of $200 for each passenger so
transported and landed.
Pursuant to 46 U.S.C. 12106 and 12110 and their
predecessors (46 U.S.C. 65i and 65m and, before them, 46 U.S.C.
11) and consistent with 46 U.S.C. App. 883, the coastwise
merchandise law, the Customs Service has consistently held that
the prohibition in 46 U.S.C. App. 289 applies to all non-
coastwise-qualified vessels. Non-coastwise-qualified vessels
include any vessel other than a vessel built in, properly
- 3 -
documented under the laws of, and owned by citizens of the
United States, with certain exceptions (see 46 U.S.C.
12106(a)(2)(B) and 19 CFR 4.80(a)(2) and (3)).
Usually, the United States Coast Guard determines whether
a vessel is built in the United States, for purposes of
documentation of the vessel, and this determination is followed
by Customs for purposes of the requirement that vessels
engaging in the coastwise trade must be built in the United
States. Vessels which are of less than 5 net tons, as we
understand to be true of the Zodiac inflatable craft under
consideration, cannot be documented under the United States
flag by the Coast Guard.
Qualified vessels of less than 5 net tons are not
precluded from engaging in the coastwise trade simply because
they cannot be documented under the laws of the United States,
however. Section 4.80(a), Customs Regulations (19 CFR
4.80(a)), enumerates the vessels which may engage in the
coastwise trade. Subparagraph (a)(2) of this section (i.e., 19
CFR 4.80(a)(2)) provides that no vessel exempt from
documentation (e.g., of less than 5 net tons) shall transport
any passengers or merchandise between United States coastwise
points unless the vessel is owned by a citizen of the United
States and is entitled to or, except for its tonnage, would be
entitled to be documented with a coastwise license. As stated
above, to be entitled to be documented with a coastwise license
a vessel must, among other things, be built in the United
States (46 U.S.C. 12106(a)(2)), with an exception inapplicable
in this case.
Thus, foreign-built inflatable crafts may not be used in
the coastwise trade. Customs has ruled, however, that
inflatable boats which, although originally built abroad, have
been sufficiently modified or rebuilt in the United States may
be considered built in the United States, for purposes of the
coastwise laws (Customs ruling No. 107435/106756, dated
March 1, 1985, copy enclosed). In making it determination as
to whether an imported vessel is rebuilt in the United States,
Customs considers the alterations and modifications done to the
hull and fittings and superstructure the critical element.
Accordingly, we find that the imported Zodiac inflatable craft,
after completion of the modifications and alterations to the
hull and fittings of the craft described above, will be
sufficiently substantially modified to be considered built in
the United States, for purposes of the coastwise laws.
- 4 -
HOLDING:
An inflatable foreign-built craft, which has substantial
modifications and additions performed on the hull and
superstructure in the United States is sufficiently
substantially modified to be considered a United States-built
vessel for purposes of the coastwise laws.
Sincerely,
B. James Fritz
Chief
Carrier Rulings Branch
Enclosure
CO:R:P:C:BEWhiting:9/30/88
Poursuivez vos recherches dans ChatGPT ou Claude
Connectez Omnilex pour rechercher dans le corpus juridique depuis votre assistant IA.