46 U.S.C. App. 883; Third proviso; Coastwise transportation

HQ 114734 June 30, 1999 VES-3-17-RR:IT:EC 114734 GOB CATEGORY: Carriers Eric Scott Operations Gearbulk Inc. 1055 Washington Boulevard Stamford, CT 06901 RE: 46 U.S.C. App. 883; Third proviso; Coastwise transportation Dear Mr. Scott: This ruling is in response to your letter of June 17, 1999 on behalf of Gearbulk Pool Ltd. FACTS: You describe the facts as follows: A U.S. customer has inquired whether they could ship with Gearbulk Pool, on a port to port bill of lading basis, from U.S. West Coast (California, Oregon or Washington) to West Coast Canada ... when Gearbulk Pool’s transport contract would cease. From there, however, we understand that the cargo may be transported via Canadian railroad to the Canadian eastern seaboard where it would be switched to a U.S. rail line and delivered to the ultimate customer in the U.S. ISSUE: The application of 46 U.S.C. App. 883 to the proposed activity. LAW AND ANALYSIS: 46 U.S.C. App. 883, the coastwise merchandise statute often referred to as the "Jones Act", provides in part: No merchandise ... shall be transported by water, or by land and water, on penalty of forfeiture of the merchandise (or a monetary amount up to the value thereof as determined by the Secretary of the Treasury, or the actual cost of the transportation, whichever is greater, to be recovered from any consignor, seller, owner, importer, consignee, agent, or other person or persons so transporting or causing said merchandise to be transported), between points in the United States ... either directly or via a foreign port, or for any part of the transportation, in any other vessel than a vessel built in and documented under the laws of the United States and owned by persons who are citizens of the United States ... The third proviso to 46 U.S.C. App. 883 provides that: this section shall not apply to merchandise transported between points within the continental United States, including Alaska, over through routes heretofore or hereafter recognized by the Surface Transportation Board for which routes rate tariffs have been or shall hereafter be filed with the Board when such routes are in part over Canadian rail lines and their own or other connecting water facilities ... Based upon the facts submitted, we determine that this situation falls within the scope of the third proviso and thus is not prohibited by 46 U.S.C. App. 883, provided that the through routes satisfy the requirements of the Surface Transportation Board ("STB") as stated within the third proviso. Through rates are "recognized by the Surface Transportation Board" within the meaning of the third proviso when tariffs for them have been filed with the STB, have not been subsequently rejected for filing, have become effective according to their terms, and have not been suspended, superseded or withdrawn by the STB. You may contact the STB at: Surface Transportation Board Office of Compliance and Enforcement Section of Tariffs 1925 K Street, N.W. Washington, D.C. 20423-0001 202-565-1579. HOLDING: The proposed transportation is not prohibited by 46 U.S.C. App. 883 by virtue of the third proviso to 46 U.S.C. App. 883, provided that the STB filing requirements of the third proviso are satisfied. Sincerely, Jerry Laderberg Chief, Entry Procedures and Carriers Branch