Coastwise Transportation; 46 U.S.C. §§ 55102, 55103; 19 CFR §§ 4.80, 4.80a, 4.80b.

HQ H234976 January 31, 2013 VES-3-02-OT:RR:BSTC:CCR H234976 DAC CATEGORY: Carriers Christopher Turner Na Pali Riders, Inc. 1225 Nohea St. P.O. Box 1082 Kalaheo, Hawaii 96741 RE: Coastwise Transportation; 46 U.S.C. §§ 55102, 55103; 19 CFR §§ 4.80, 4.80a, 4.80b. Dear Mr. Turner: This letter is in response to a correspondence of November 5, 2012, with respect to the coastwise use of a vessel. Our ruling is set forth below. FACTS: The subject vessel is an inflatable vessel, named the SEA BISCUIT. The subject vessel is described as a Zodiac 920 Hurricane, (Serial no. XDC92062J304), and you request a determination as to whether such vessel may engage in coastwise trade. The subject vessel has obtained a Certificate of Inspection from the United States Coast Guard (USCG), (official number HA1603CP), and the Certificate is valid from April 27, 2010 through April 27, 2015. You have also obtained a letter dated January 25, 2012, from the USCG. ISSUE: Whether the subject vessel may engage in the coastwise trade within the meaning of 46 U.S.C. §§ 55102, 55103 and 19 CFR § 4.80? 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 relevant coastwise laws are generally found at 46 U.S.C. §§ 55101 et seq. The coastwise law applicable to the carriage of passengers is located at 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- (1) is wholly owned by citizens of the United States for purposes of engaging in the 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. 46 U.S.C. § 55103. The relevant coastwise law applicable to the transportation of merchandise is located at in 46 U.S.C. § 55102 (recodified by Pub. L. 109-304, enacted on October 6, 2006) and provides, in pertinent part: (a) Definition. In this section, the term “merchandise” includes-- (1) merchandise owned by the United States Government, a State, or a subdivision of a State; and (2) valueless material. (b) Requirements. Except as otherwise provided in this chapter or chapter 121 of this title [46 USCS §§ 55101 et seq. or 12101 et seq.], a vessel may not provide any part of the transportation of merchandise by water, or by land and water, between points 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 the coastwise trade; and (2) has been issued a certificate of documentation with a coastwise endorsement under chapter 121 [46 U.S.C. §§ 12101 et seq.] or is exempt from documentation but would otherwise be eligible for such a certificate and endorsement. 46 U.S.C. § 55102. The relevant CBP regulations at 19 CFR § 4.80 provide, in pertinent part: 19 CFR § 4.80 Vessels entitled to engage in coastwise trade. (a) No vessel shall transport, either directly or by way of a foreign port, any passenger or merchandise between points in the United States embraced within the coastwise laws, including points within a harbor, or merchandise for any part of the transportation between such points, unless it is: (1) Owned by a citizen and is so documented under the laws of the United States as to permit it to engage in the coastwise trade; (2) Owned by a citizen, is exempt from documentation, and is entitled to or, except for its tonnage, would be entitled to be documented with a coastwise endorsement. 19 CFR § 4.80. In the present case, the subject vessel has a current certificate of inspection (that expires April 27, 2015) issued by the USCG that states the following: Route Permitted and Conditions of Operation: Lakes, Bays, and Sounds plus Limited Coastwise Pacific Ocean, State of Hawaii, Hawaiian Islands, not more than 20 miles from a harbor of safe refuge, not more than 3 miles from shore. … The Master must remain on board the vessel at all times while underway or at anchor when carrying passengers for hire. See also 14 U.S.C. § 100. In regards to the subject vessel you received a letter, dated January 25, 2012, from the USCG that states the following: The vessel is less than five net tons and not eligible for documentation. … The vessel should be operated under state registration. You also received a letter, dated October 13, 2012, from CBP in Honolulu, Hawaii, that states the following: [I]t has been determined that inflatable vessel Sea Biscuit … is qualified for coastwise trade. (italics retained.) In the present case, although CBP in Honolulu, Hawaii, has determined that the subject vessel is qualified for the coastwise trade, we find that the USCG has determined that the subject vessel is less than five net tons and is not eligible for documentation. In accordance with 19 CFR § 4.80, coastwise qualified vessels that are not eligible for documentation may engage in the coastwise trade. See also HQ 114060, August 15, 1997. Accordingly, the subject vessel may engage in the coastwise trade. See 46 U.S.C. §§ 12101 et seq. 46 U.S.C. §§ 55101 et seq. See also 19 CFR §§ 4.80, 4.80a, 4.80b. HOLDING: The subject vessel may engage in the coastwise trade within the meaning of 46 U.S.C. §§ 55102, 55103 and 19 CFR § 4.80. Sincerely, George Frederick McCray Supervisory Attorney-Advisor/Chief Cargo Security, Carriers and Restricted Merchandise Branch Office of International Trade, Regulations & Rulings U.S. Customs and Border Protection