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

HQ H062375 May 29, 2009 VES-3-02-OT:RR:BSTC:CCI H062375 JLB CATEGORY: Carriers Mr. Jack Atanassov Norton Lilly International 5080 McLester Street Elizabeth, New Jersey 07207 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b) Dear Mr. Atanassov: This letter is in response to your correspondence dated May 28, 2009, in which you request a ruling on whether the coastwise transportation of the individuals mentioned therein aboard the M/V APL PEARL 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 individuals aboard the non-coastwise-qualified M/V APL PEARL (“the vessel”). Three of the four individuals embarked on May 29, 2009 at New York, New York and will disembark at the port of Charleston, South Carolina on May 31, 2009. These individuals will travel aboard the vessel in order to prepare for the re-flagging and re-crewing activities as the vessel changes to a US-flagged vessel. One of the individuals, an information tech engineer, will travel aboard the vessel to install new communication systems and a computer network system. Another individual will inspect the deck equipment and inventory as well as perform a safety familiarization while the third individual will perform a sanitary and galley inspection and inventory. The final individual embarked at New York, New York on May 29, 2009 and will disembark at Norfolk, Virginia on June 4, 2009. This individual, a technical superintendent, will travel aboard the vessel to perform a machinery inspection and spare parts inventory, which is required as part of the re-flagging process. ISSUE Whether the individuals described above would be “passengers” 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. 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, U.S. Customs and Border Protection (“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 four individuals would be traveling aboard the non-coastwise-qualified vessel to perform the duties described above. Under the facts presented, the individuals would be “directly and substantially” related to the operation and business of the vessel during the voyage and would not be considered “passengers” under 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Consequently, the coastwise transportation of the subject individuals is not in violation of 46 U.S.C. § 55103. HOLDING The subject individuals are not “passengers” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Therefore, the coastwise transportation of such individuals is not in violation of 46 U.S.C. § 55103. Sincerely, Glen E. Vereb, Chief Cargo Security, Carriers and Immigration Branch