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

HQ H058116 April 22, 2009 VES-3-02-RR:BSTC:CCI H058116 GOB CATEGORY: Carriers Jason Pedersen Deputy Director, Human Resources Holland America Line 300 Elliott Avenue West Seattle, WA 98119 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 CFR § 4.50(b) Dear Mr. Pedersen: This letter is in response to your letter of April 21, 2009, with respect to the coastwise transportation of an individual. Our ruling is set forth below. FACTS: You ask whether an individual may be transported on the non-coastwise-qualified PRINSENDAM (the “vessel”), from New York, New York to Fort Lauderdale, Florida during the period of April 27, 2009 through April 30, 2009, for the purpose of “conducting a Leadership in Action (LIA) workshop aboard, as well as reviewing quality assurance and best practices of [your] human resource processes.” You state that the individual (“Traveling Trainer – Human Resources”) is tasked from your corporate headquarters to travel from vessel to vessel to provide specific leadership and performance management training to shipboard senior management, along with the onboard human resources representative. He will provide guidance and training to the captain, chief officer, chief engineer, hotel manager, and various other department heads to address the immediate needs of employee development and retention. This training will include leadership skills in the development of subordinates. You state that the three-day training is essential to the success of your officers and crew. ISSUE: Whether the subject individual is a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 CFR § 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. 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: (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- is wholly owned by citizens of the United States for purposes of engaging in the coastwise traffic; and 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. Section 4.50(b), Customs and Border Protection (“CBP”) Regulations (19 CFR § 4.50(b)) provides as follows: A passenger within the meaning of this part is any person carried on a vessel who is not connected with the operation of such vessel, her navigation, ownership, or business. You state that the subject individual will be transported on the vessel for the purpose of conducting a Leadership in Action workshop aboard, as well as reviewing quality assurance and best practices of your human resource processes. In this context, and in accordance with previous Headquarters rulings, workmen, technicians, or observers transported by vessel between ports of the United States are not classified as “passengers” within the meaning of 46 U.S.C. § 55103 and 19 CFR § 4.50(b), 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. HQ 101699, of November 5, 1975; see also HQ 116721, of September 25, 2006, quoting HQ 101699. Thus, in the present case, to the extent that the individual would be engaged in any shipboard activities while traveling on the non-coastwise-qualified vessel between coastwise ports, that would be “directly and substantially” related to the operation or business of the vessel itself, such individual would not be considered to be a passenger (see HQ 116721, supra; and see HQ 116659, of May 19, 2006, referencing the “direct and substantial” test). See also, e.g., Customs telex 104712, of July 21, 1980, finding that repairmen were not passengers when carried aboard a foreign vessel between U.S. ports “for [the] purpose of repairing vessel en route between such ports." We find that the proposed activity in this case is directly and substantially connected with the operation or business of the vessel. Therefore, we determine that the subject individual is not a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 CFR § 4.50(b). Accordingly, the coastwise transportation of such individual is not in violation of 46 U.S.C. § 55103. HOLDING: The subject individual is not a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 CFR § 4.50(b). Therefore, the coastwise transportation of such individual is not be in violation of 46 U.S.C. § 55103. Sincerely, Glen E. Vereb Chief Cargo Security, Carriers and Immigration Branch