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

HQ H150916 March 11, 2011 VES-3-OT:RR:BSTC:CCI H150916 LLB CATEGORY: Carriers Mr. David William Kelly Oceania Cruises 8300 NW 33rd Street, Suite 308 Miami, Florida 33122 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b). Dear Mr. Kelly: This is in response to your correspondence of March 1, 2011, and your supplemental correspondence dated March 2, and 8, 2011, in which you inquire about the coastwise transportation of the individuals mentioned therein aboard the MARINA. Our decision follows. FACTS: The voyage in question involves the transportation of the subject individuals aboard the non-coastwise-qualified MARINA (“the vessel”). The individuals, the President of Oceania Cruises and his spouse, will embark in Miami, Florida on March 28, 2011 and disembark in New York, New York on April 3, 2011. The individuals will be preparing and hosting promotional events for travel agents and their families that will showcase the MARINA. Specifically, during the foregoing voyage, the vessel will call in Savannah, Georgia on March 30, 2011 and in Charleston, South Carolina on March 31, 2011. At each port of call, the travel agents and their families will board the vessel for the day while the vessel is docked, and leave the vessel before the vessel proceeds to the next port. While the vessel is traveling between ports, the individuals will be preparing presentations, marketing materials, and event schedules. ISSUE: Whether the individuals described in the FACTS section above are “passengers” 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. 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 trade; and (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. Section 4.50 (b) of the Customs and Border Protection (“CBP”) Regulations 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. Furthermore, the shipboard activities engaged in by such aforementioned individuals while traveling on a non-coastwise-qualified vessel between coastwise ports must be “directly and substantially” related to the operation, navigation, ownership, or business of the vessel itself in order for such individuals to not be considered as passengers under these provisions of law. See HQ 116659 (May 19, 2006) (referencing the “direct and substantial” test); see also, Cust. Bull., Vol. 36, No. 23, at p. 50 (June 5, 2002). CBP has determined, in accordance with General Letter No. 117 of May 20, 1916, from the former Bureau of Navigation, that officers of the company owning a vessel, would by virtue of their positions, be “directly and substantially” connected with the ownership or business of that vessel if they acted in their official capacities aboard the vessel. See H069521 (Sept. 14, 2009) (holding the President and CEO and Vice Presidents of the vessel owner were not passengers when transported for the purpose of attending a team building conference with the vessel’s senior staff); H043321 (Nov. 4, 2008) (President and CEO of the vessel owner were not passengers when transported for the purpose of attending a budget meeting with the vessel company’s board of directors); and H024346 (the CEO, the President, the Executive Vice President and CFO not considered passengers when transported for the purpose of attending a board of directors meeting). In the present case, the President, an officer of the company that owns the vessel, will be traveling aboard the vessel to showcase it to travel agents and their families while the vessel is at the ports of call indicated in the FACTS section above. We find that the foregoing activities would be directly and substantially connected with the business of the vessel and we therefore determine that the subject individual is not a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Accordingly, the coastwise transportation of the President of the vessel company would not be in violation of 46 U.S.C. § 55103. With regard to the President’s spouse, CBP has held that the spouse and children of the officers of a vessel are not passengers within the meaning of the navigation laws. See HQ H069521 citing General Letter No. 117 (Bureau of Navigation) and Cust. Bull., Vol. 36, No. 23, p. 50. Insofar as the President is an officer of the vessel and the subject individual is the captain’s spouse, we determine that the subject individual is not a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Accordingly, the coastwise transportation of the President’s spouse would not be in violation of 46 U.S.C. § 55103. HOLDING: The President of the vessel company and his spouse 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 would not be in violation of 46 U.S.C. § 55103. Sincerely, George Frederick McCray Supervisory Attorney-Advisor/Chief Cargo Security, Carriers and Immigration Branch Office of International Trade, Regulations & Rulings