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

HQ H182304 September 1, 2011 VES-3-02-OT:RR:BSTC:CCI H182304 WRB CATEGORY: Carriers Mr. Steve Gallaway Director of Corporate Operations Hapag Lloyd 399 Hoes Lane Piscataway, NJ 08854 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b) Dear Mr. Gallaway: This letter is in response to your correspondence dated August 26, 2011, in which you request a ruling on whether the coastwise transportation of four individuals mentioned therein aboard the M/V ANTWERPEN EXPRESS and M/V KIEL EXPRESS 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 ANTWERPEN EXPRESS and M/V KIEL EXPRESS (“the vessels”). Two individuals will embark the M/V ANTWERPEN EXPRESS September 3, 2011 at Hamburg, Germany. The M/V ANTWERPEN EXPRESS will then travel across the Atlantic Ocean to Halifax, Nova Scotia, and then call the ports of New York, New York, Norfolk, Virginia, Savannah, Georgia, and transit the Panama Canal, arriving at Oakland, California on October 1, 2011, where the individuals will disembark. The other two individuals will embark aboard the M/V KIEL EXPRESS at Seattle, Washington, on October 2, 2011. The M/V KIEL EXPRESS will then travel to Oakland, California, transit the Panama Canal, call at Savannah, Georgia, Norfolk, Virginia, New York, New York, Halifax, Nova Scotia, and then depart foreign for Hamburg, Germany, arriving November 4, 2011, where the individuals will disembark. In both voyages, the individuals are employees of Hapag Lloyd and their wives. 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: 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, navigation, ownership, or business of the vessel. The U.S. Customs and Border Protection (“CBP”) Regulations promulgated pursuant to 46 U.S.C. § 55103 are found at 19 CFR 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, ” and “disembark” means “a passenger leaving a vessel at the conclusion of a specific voyage.” The terms “embark” and “disembark” are not applicable to a passenger going ashore temporarily at a coastwise port who reboards the vessel and departs with it on sailing from the port See 19 CFR 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 CBP Ruling HQ 112208 (June 29, 1992). Section 4.80a(b)(3), CBP Regulations (19 CFR 4.80a(b)(3)) provides as follows: If the passenger is on a voyage to one or more coastwise ports and a distant foreign port or ports (whether or not the voyage includes a nearby foreign port or ports) and the passenger disembarks at a coastwise port, there is no violation of the coastwise law provided the passenger has proceeded with the vessel to a distant foreign port. Pursuant to 19 CFR 4.80a(a)(1), a “coastwise port” is a port in the United States, or its territories, or its possessions embraced within the coastwise laws. Pursuant to Section 4.80a(a)(2), CBP Regulations (19 CFR 4.80a(a)(2)), a “nearby foreign port” is a “foreign port in North America, Central America, the Bermuda Islands, or the West Indies (including the Bahama Islands, but not including the Leeward Islands of the Netherland Antilles, i.e., Aruba, Bonaire, and Curacao.” Pursuant to Section 4.80a(a)(3), CBP Regulations (19 CFR 4.80a(a)(3)), a “distant foreign port” is “any foreign port that is not a nearby [foreign] port.” As noted above, the subject individuals will embark the M/V ANTWERPEN EXPRESS at Hamburg, Germany, a distant foreign port, and disembark at at Oakland, California. Accordingly, no coastwise transportation would occur. Similarly, two other subject individuals will embark the the M/V KIEL EXPRESS at Seattle, Washington, and disembark at Hamburg, Germany. Accordingly, no coastwise transportation would occur. Based on the foregoing, the proposed coastwise transportation of the subject individuals is not in violation of 46 U.S.C. § 55103. HOLDING The proposed itineraries described above do not constitute violations 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 U.S. Customs and Border Protection