Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b)

HQ H038597 September 18, 2008 VES-3-02-OT:RR:BSTC:CCI H038597 JLB CATEGORY: Carriers Capt. Sanjiv Sehgal Operations Manager Wilhelmsen Technical & Operational Solutions 1 Kim Seng Promenade #16-09/12 Great World City West Tower Singapore 237994 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b) Dear Capt. Sehgal: This letter is in response to your correspondence dated September 17, 2008, in which you request a ruling on whether the coastwise transportation of the individual mentioned therein aboard the non-coastwise-qualified vessels constitutes a violation of 46 U.S.C. § 55103. Our ruling on your request follows. FACTS The voyage in question involves the transportation of the subject individual, a superintendent, aboard the non-coastwise-qualified M/V WREN, M/V GLENROSS, M/V TAMARLANE, and M/V SENTINEL II (“the vessels”). The individual will travel aboard the M/V WREN from September 24 to September 27, 2008 and will embark and disembark at the port of Brownsville, Texas. Then the superintendent will embark the M/V GLENROSS on September 28 at New Orleans, Louisiana and will disembark at New Orleans on September 30, 2008. For the voyage aboard the M/V TAMARLANE, the individual will embark on October 2, 2008 at Savannah, Georgia and will disembark on October 7, 2008 in Panama. Finally, the individual will travel aboard the M/V SENTINEL II. The individual will embark on that voyage on October 8 at Houston, Texas and disembark on October 14 at Surinam. The individual will travel aboard the vessels to perform International Safety Management (“ISM”) Code and International Ship & Port Facility Security (“ISPS”) Code audits. The individual will also conduct training for the crew and ensure that the vessels are complying with the company’s additional safety requirements. ISSUES Whether the use of the non-coastwise-qualified vessels in the voyage described above constitutes an engagement of coastwise trade in violation of 46 U.S.C. § 55103? Whether the individual described above would be a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b)? LAW AND ANALYSIS The coastwise passenger statute, former 46 U.S.C. App. § 289 recodified as 46 U.S.C. § 55103, pursuant to P.L. 109-304 (October 6, 2006), states that no foreign vessel shall transport passengers “between ports or places in the United States to which the coastwise laws apply, either directly or by way of a foreign port,” under a penalty of $300 for each passenger so transported and landed. See also 19 C.F.R. § 4.80(b)(2). The coastwise laws generally apply to points in the territorial sea, which is defined as the belt, three nautical miles wide, seaward of the territorial sea baseline, and to points located in internal waters, landward of the territorial sea baseline. In the present case, the coastwise passenger statute is inapplicable to the subject individual’s voyage aboard the M/V TAMARLANE and the M/V SENTINEL II. U.S. Customs and Border Protection (“CBP”) has previously held that individuals embarking at a U.S. port and disembarking at a foreign port were not in violation of the coastwise laws since their transportation does not involve disembarkation at a coastwise port. See, e.g., Headquarters Ruling Letter H016892, dated September 12, 2007; Headquarters Ruling Letter H022016, dated January 16, 2008. Based on the facts presented, the subject individual will embark the M/V TAMARLANE at Savannah, Georgia and will disembark in Panama, a foreign port. Similarly, the individual will embark the M/V SENTINEL II in Houston, Texas and disembark in Surinam, a foreign port. Consequently, the individual will not be in violation of the coastwise statutes insofar as his transportation does not involve disembarkation at a coastwise port. Additionally, if the individual will be embarking and disembarking at the same coastwise point, then no violation of 46 U.S.C. § 55103 results. Accordingly, if the individual in this case is embarking and disembarking at the same coastwise point in Brownsville or New Orleans during the other two voyages, there is no violation of 46 U.S.C. § 55103. Alternatively, under 46 U.S.C. § 55103, a “passenger” is any person carried aboard a vessel “who is not connected with the operation of the vessel, her navigation, ownership, or business.” See also 19 C.F.R. § 4.50(b). In this regard, CBP provides a strict interpretation of “passenger” defining the term as persons transported on a vessel unless they are "directly and substantially" connected with the operation, navigation, ownership or business of that vessel itself. See Customs Bulletin of June 5, 2002, Vol. 36, No. 23, at pp. 50. Pursuant to Headquarters Ruling Letter 101699, dated November 5, 1975, it is well settled that "workmen, technicians, or observers transported by vessel between ports of the United States are not classified as ‘passengers’ within the meaning of section 4.50(b) and section 289 [now section 55103] if they are required to be on board to contribute to the accomplishment of the operation or navigation of the vessel during the voyage or are on board because of a necessary vessel ownership or business interest during the voyage." See also Headquarters Ruling Letter 116721, dated September 25, 2006. In the present case, the individual would be traveling aboard the non-coastwise-qualified vessels to perform ISM and ISPS audits. Under the facts presented, the individual would be “directly and substantially” related to the operation and business of the vessel during the voyage and would not be considered a “passenger” under 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Consequently, the coastwise transportation of the subject individual is not in violation of 46 U.S.C. § 55103. HOLDINGS The use of the non-coastwise-qualified M/V TAMARLANE and the M/V SENTINTEL II in the voyage described above does not constitute an engagement in the coastwise trade in violation of 46 U.S.C. § 55103. If the individual will embark and disembark the M/V WREN and/or the M/V GLENROSS at the same coastwise point, then no violation of 46 U.S.C. § 55103 results. Alternatively, the subject individual is not a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Therefore, the coastwise transportation of such an individual is not in violation of 46 U.S.C. § 55103. Sincerely, Glen E. Vereb, Chief Cargo Security, Carriers and Immigration Branch