Vessel Repair Entries
My vessel was repaired abroad. Do I need to pay customs duty?
Understanding the Customs laws and regulations for vessel repair entries is challenging, and failure to understanding the minutia of the duty assessment can increase costs significantly.
Generally, customs laws require that repairs and related costs to U.S. flag vessels engaged in fisheries, foreign or coastwise trade must be declared and entered. Such costs may be subject to 50% repair duties.
How can Kennard & Associates help with Vessel Repair Entries?
We know the questions to ask, the paperwork to file, and the deadlines to meet. We know that successful handling of vessel repair entries requires close and detailed communication.
Based on cost estimates provided by you, we prepare the Foreign Repair Declaration (CBP Form 226) and provide it to the vessel’s agent and brokers on arrival. We then prepare and file the Incomplete Vessel Repair Entry within the 10-day requirement.
After filing the initial paperwork, we will work with you to gather the documentation required for submissions to Customs. We will review the documents to determine what needs to be declared, and prepare documentation to support any claims for remission from vessel repair duties.
What happens if CBP doesn’t agree with the Application for Relief?
Kennard & Associates can help! In cases where CBP doesn’t agree with some of the positions taken in the Application for Relief, we will determine if additional information or documentation may convince them of your initial claim.
If we determine the claim is reasonable, we will file a formal protest with Customs for an additional review of the claim. This is the first step required to take an issue to the Court of International Trade.
Are there costs not subject to Declaration?
Yes. There are a number of situations where costs are not subject to CBP declaration, including:
- Expenditures made in American Samoa, Puerto Rico, Guantanamo Naval Station, Guam, or the U.S. Virgin Islands. These are all considered part of the United States for vessel repair purposes.
- Reimbursements paid to regular crew members for repairs made to the vessel on the high seas or in foreign ports.
- The cost of equipment, repair parts and/or materials that are installed on the vessel by the regular crew members. is this different than “Reimbursements paid to regular crew members for repairs made to the vessel on the high seas or in foreign ports?” Yes.
- Costs incurred in certain nations with free trade agreements with the United States
- Costs that meet the CBP defined prerequisites for modifications or repairs due to casualty
- If the vessel was outside the U.S. for more than two years
- If the parts were of U.S. origin and/or labor was provided by U.S. residents.
For more information on these exceptions, contact us.
Are there costs subject to reduced duty?
Yes. Costs subject to reduced duty include:
- Spare parts necessarily entered and duty paid prior to arrival of the vessel
- General Service charges (e.g. drydock costs, shore power, etc.) are to be prorated based on the ratio between dutiable and free items.
Contact us to learn more about costs that are subject to reduced duty.
Important Deadlines for Vessel Repair Entries*
- Foreign Repair Declaration – Due on Arrival of Vessel
- Incomplete Vessel Repair Entry – Due within 10 days of vessel arrival
- Complete Vessel Repair Entry – Due within 90 days of vessel arrival
- Application for Relief from vessel repair duties – Due within 90 days of vessel arrival
*There are two potential 30-day extensions available to file the Complete Vessel Repair Entry and related Application for Relief.
Contact us for more information about vessel repair entry deadlines and extensions.