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

HQ H045338 November 26, 2008 VES-3-02-OT:RR:BSTC:CCI H045338 GG CATEGORY: Carriers Mr. Jim D. Spencer General Steamship Corporation, Ltd. 3741 Red Bluff Road, Suite 340 Pasadena, Texas 77503-3330 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 CFR § 4.50(b) Dear Mr. Spencer: This is in response to your correspondence of November 24, 2008, in which you inquire about the coastwise transportation of an individual. Our ruling is set forth below. FACTS The voyage in question involves the transportation of the subject individual aboard the non-coastwise-qualified M/T GOLDEN ORCHID (the “vessel”), on a proposed voyage from Houston, Texas, to New Orleans, Louisiana, and back to Houston, Texas. The individual will embark the vessel on or about November 28, 2008 in Houston, and disembark in Houston on or about December 8, 2008. It is expected that the individual will not disembark or go ashore temporarily in New Orleans. The stated purpose for the transportation of the subject individual is to conduct an audit, namely overseeing the operation of the crew and vessel in order to evaluate how the vessel is running. ISSUE Whether the use of a non-coastwise-qualified vessel for the transportation of the subject individual in the voyage as described above, constitutes an engagement in coastwise trade in violation of 46 U.S.C. § 55103. LAW AND ANALYSIS Generally, the coastwise laws prohibit the transportation of passengers or merchandise 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. Such a vessel, after it has obtained a coastwise endorsement from the U.S. Coast Guard, is said to be “coastwise qualified.” The coastwise law applicable to the carriage of passengers is found in 46 U.S.C. § 55103 (recodified by Pub. L. 109-304, enacted on October 6, 2006) and provides that no foreign vessel shall transport passengers “between ports or places in the United States to which the coastwise laws apply, either directly or via a foreign port,” under a penalty of $300 for each passenger so transported. 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. The U.S. Customs and Border Protection ("CBP") Regulations promulgated pursuant to 46 U.S.C. § 55103 are found at 19 C.F.R. § 4.80a. These regulations provide guidelines for determining whether the movement of passengers between two coastwise points is considered coastwise trade. The term "embark" is defined as a "passenger boarding a vessel for the duration of a specific voyage." See 19 C.F.R. § 4.80a(a)(4). A passenger "disembarks" from the vessel if the passenger "finally and permanently" leaves the vessel at the conclusion of the specific voyage. See Headquarters Ruling Letter 112208, dated June 29, 1992. In its administration of 46 U.S.C. § 55103, CBP has ruled that the carriage of passengers entirely within territorial waters, even though the passengers disembark at their point of embarkation and the vessel touches no other coastwise point, is considered coastwise trade subject to the coastwise laws. However, the transportation of passengers to the high seas (i.e., beyond the three-mile territorial sea) and back to the point of embarkation, assuming the passengers do not go ashore, even temporarily, at another United States point (often called a "voyage to nowhere"), is not considered coastwise trade. See 29 O.A.G. 318 (1912). In the present case, the contemplated voyage between Houston and New Orleans and back to Houston, involves transportation beyond the three-mile territorial sea, through international waters. Moreover, the subject individual will not disembark or go ashore temporarily in New Orleans, but rather will return with the vessel to the point of embarkation in Houston, where the individual will disembark. Accordingly, 46 U.S.C. § 55103 is inapplicable to the subject voyage, and there is no violation of the coastwise statute. HOLDING The use of a non-coastwise-qualified vessel in the proposed voyage described above does not constitute an engagement in the coastwise trade in violation of 46 U.S.C. § 55103. Sincerely, Glen E. Vereb Chief Cargo Security, Carriers and Immigration Branch