HQ 111336: Petition for Review on Houston Vessel Repair Entry No. C53- 0012147-8, June 12, 1989; Vessel: M/V PRIDE OF TEXAS, Voyage No. 38; U.S. spare parts and owner-supplied spare parts; Customs and Trade Act of 1990; P.L. 101-382; 19 U.S.C. 1466(h).

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 111336

                          June 7, 1991

VES-13-18-CO:R:IT:C  111336 BEW

CATEGORY:  Carriers

Deputy Assistant Regional Commissioner
Commercial Operations Division
ATTN:  Vessel Repair Liquidation Unit
New Orleans, Louisiana  70130

Re:  Petition for Review on Houston Vessel Repair Entry No. C53-
     0012147-8, June 12, 1989;  Vessel:  M/V PRIDE OF TEXAS,
     Voyage No. 38; U.S. spare parts and owner-supplied spare
     parts; Customs and Trade Act of 1990; P.L. 101-382; 19
     U.S.C. 1466(h).

Dear Sir:

     This is in reference to a petition for relief from duties
filed by the attorney for Seahawk Management, Inc., on a partial
denial of an application for relief for duties assessed on
repairs made to the M/V PRIDE OF TEXAS, Voyage No. 38.

FACTS:

     The petitioner's request for review centers on the costs
relating to the owner supplied U.S. spare parts listed as
follows:

     I.           Invoice                              Amount
          Cooper Industries invoice No. 77805       $4,512.85
          Cooper Industries invoice No. 77832       $  668.60
          Cooper Industries invoice No. 77864       $6,662.00
          Cooper Industries invoice No. 77869       $  843.00

     II.  CamGear Ring P/N 02-350-05-AC            $12,104.00

     In a decision dated July 13, 1990 (HQ 110644 BEW), we ruled
that the applicant had submitted invoices for the subject
articles which indicate purchase in the United States, however,
there was no evidence submitted that addressed the articles'
place of manufacture.  We held that since no direct evidence of
U.S. manufacture had been submitted, the amounts listed for the
U.S. materials were dutiable.

     The petitioner has submitted additional evidence to show
that the subject materials were manufactured in the United
States.

ISSUE:

     1.   Whether sufficient evidence is presented to establish
          that subject owner-supplied spare parts were
          manufactured in the U.S. which are free under the
          vessel repair statute (19 U.S.C. 1466(h)).

LAW AND ANALYSIS:

     Title 19, United States Code, section 1466(a), provides in
pertinent part for payment of duty in the amount of 50 percent ad
valorem on the cost of foreign repairs to vessels documented
under the laws of the United States to engage in the foreign or
coastwise trade, or vessels intended to be employed in such
trade.

     The climate with regard to parts shipped abroad from the
United States for foreign installation was transformed on August
20, 1990, when the President signed Public Law 101-382 which
added a new subsection (h) to section 1466.  While this
provision applies by its terms only to foreign-made imported
parts, there is ample reason to extend its effect to U.S.-made
materials as well.  To fail to do so would act to discourage the
use of U.S.-made materials in effecting foreign repairs since
continued linkage of remission provisions of subsection (d)(2)
with the assessment provisions of subsection (a) of section 1466
would obligate operators to pay duty on such materials unless
they were installed by crew or resident labor.  If an article is
claimed to be of U.S. manufacture, there must be proof of its
origin in the form of a bill of sale or domestic invoice.  If an
article is claimed to have been previously entered for
consumption, duty paid by the vessel operator, there must be
proof of this fact in the form of a reference to the consumption
entry number for that previous importation, as well as to the
U.S. port of importation.  If imported articles are purchased
from third parties in the United States, a domestic bill of sale
to the vessel operator must be presented.

     The petitioner has submitted a letter dated July 31, 1990,
from Cooper Industries Energy Service Group confirming that the
subject parts were manufactured in the United States.
Accordingly, the petition is granted.

HOLDING:

     The evidence presented is sufficient to substantiate that
the subject parts were manufactured in the United States, thus
warranting remission pursuant to 19 U.S.C. 1466(h).  The petition
is granted.

                                     Sincerely,




                                     B. James Fritz
                                     Chief
                                     Carrier Rulings Branch