Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b); HQ H011874 (May 31, 2007); HQ H023376 (May 10, 2008); HQ H027133 (May 5, 2008); HQ H042296 (Oct. 30, 2008); HQ 115360 (May 29, 2001)

HQ H057656 May 26, 2009 VES-3-02-OT:RR:BSTC:CCI H057656 LLB CATEGORY: Carriers Mr. James Mills Operations Coordinator residenSea 14471 Miramar Parkway, Suite 401 Miramar, Florida 33027 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b); HQ H011874 (May 31, 2007); HQ H023376 (May 10, 2008); HQ H027133 (May 5, 2008); HQ H042296 (Oct. 30, 2008); HQ 115360 (May 29, 2001) Dear Mr. Mills: This letter is in response to your correspondence dated April 14, 2009 and May 22, 2009, in which you inquire about the "coastwise clearance" of the individual mentioned therein aboard THE WORLD. We are construing your correspondence as a request for a ruling to determine whether the coastwise laws, specifically 46 U.S.C. § 55103, and one of the regulations promulgated under that statute, 19 C.F.R. § 4.50(b), apply to the factual scenario you present. Our decision follows. FACTS The voyage in question involves the transportation of the subject individual, the Senior Vice-President of Sales and Marketing of ResidenSea, aboard the non-coastwise-qualified THE WORLD (the “vessel”). The individual will embark in San Diego, California on June 1, 2009 and disembark in Los Angeles, California on June 5, 2009. The subject individual will meet with the residents of the vessel to review sales status of onboard apartments and to assist the residents with developing marketing strategies for their properties. In addition, the subject individual will train the onboard sales staff and meet with prospective clients. ISSUE Whether the individual described in the FACTS section above is a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b) 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 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. See 33 C.F.R. § 2.22(a)(2)(2009).The coastwise law applicable to the carriage of passengers is found in 46 U.S.C. § 55103 which provides: (a) In General. Except as otherwise provided in this chapter or chapter 121 of this title, a vessel may not transport passengers between ports or places in the United States to which the coastwise laws apply, either directly or via a foreign port, unless the vessel- (1) is wholly owned by citizens of the United States for purposes of engaging in coastwise traffic; (2) has been issued a certificate of documentation with a coastwise endorsement under chapter 121 or is exempt from documentation but would otherwise be eligible for such a certificate and endorsement. (b) Penalty. The penalty for violating subsection (a) is $300 for each passenger transported and landed. The Customs and Border Protection (“CBP”) Regulations, promulgated under the authority of 46 U.S.C. § 55103, provide: A passenger within the meaning of this part is any person carried on a vessel who is not connected with the operation of the vessel, her navigation, ownership, or business. 19 C.F.R. § 4.50(b). In HQ 116659 (May 19, 2006), a cruise line proposed transporting employees and contractors that worked in the areas of North America Sales and Marketing and International Sales and Marketing for the purpose of strategizing on how to sell, market, and enhance the overall guest experience of the vessel. CBP held that the foregoing individuals were “passengers” within the meaning of 19 C.F.R. § 4.50(b) and the coastwise transportation of those passengers would be in violation of 19 U.S.C. § 55103. The holding in HQ 116659 was affirmed after reconsideration of the issue in HQ 116668 and has since been upheld in several rulings. See HQ H020448 (Dec. 13, 2008) (holding that sales and marketing cruise line employees and contractors conducting an "industrial show" for travel agencies were passengers); HQ H023116 (Feb. 22, 2008) (holding that sales account executive conducting sales training seminars to top producing travel agencies was a passenger); HQ H013701 (July 10, 2007) (holding that sales representatives are passengers); HQ H002925 (Nov. 8, 2006) (holding that key account representative is a passenger). In addition, we have historically held that individuals, cruise line employees or contractors, transported solely for the promotional purpose of the cruise line, are passengers within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). See Bureau Letter dated July 3, 1957, MA 212 (movie making); HQ 109695 (Nov. 3, 1988) (camera crew carried aboard to film a promotional video); HQ 116668 (camera crew and company employees engaged in promotional filming for cruise line); HQ H008038 (Mar. 9, 2007) (holding that two marketing employees of the cruise line and independent contractors, that were shooting, producing, and performing in a promotional video cruise line were passengers). CBP’s reasoning in the holdings in the foregoing cases is that none of those activities are “directly and substantially” related to the operation or business of the vessel itself. We distinguish the foregoing rulings, which involved luxury cruise line vessels that are in the business of providing onboard entertainment during voyages to "passengers" as defined by 19 C.F.R. § 4.50(b), which again, are "any person[s] carried on a vessel who [are] not connected with the operation of the vessel, her navigation, ownership, or business." The subject vessel is engaged in the business of providing residences, e.g. condominiums. It was based on the foregoing fact that CBP determined the persons transported by THE WORLD, that is, residents that maintain their condominiums as full-time residences, are not passengers within the meaning of 19 C.F.R. § 4.50(b) insofar as their ownership interest in their accommodations aboard the vessel connect them with the business of the vessel. See HQ 115360 (May 29, 2001). Accordingly, allowing the Senior Vice President of Marketing and Sales to be transported to assist the foregoing individuals with the sale of their condominiums would likewise directly and substantially connect that individual with the business of the vessel. HOLDING The subject individual, that will assist the residents onboard the vessel with selling their homes, as described in the FACTS section herein, 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 individual would not be in violation of 46 U.S.C. § 55103. Sincerely, Glen E. Vereb Chief Cargo Security, Carriers and Immigration Branch