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

U.S. Department of Homeland Security Washington, DC 20229 U.S. Customs and Border Protection HQ H252013 April 3, 2014 VES-3-02-OT:RR:BSTC:CCR HQ H252013 DAC CATEGORY: Carriers Beatrice Aragon Inchcape Shipping Services 100 W. Broadway, Suite 330 Long Beach, CA 90802 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b) Dear Ms. Aragon: This letter is in response to your correspondence of April 2, 2014, with respect to the coastwise transportation of two individuals. Our ruling is set forth below. FACTS: You ask whether two individuals may be transported on the non-coastwise-qualified M/T AMAGI GALAXY (the “vessel”), from Los Angeles/ Long Beach, California, to San Francisco, California from on or about April 6, 2014, through on or about April 11, 2014. The individuals would be transported for the purpose of performing the following activities: 1) to visit vessels at USA ports and meet and discuss with the seafarers serving onboard such vessels on behlaf of principal; 2) to discuss with master and Chief Engineer of the vessel regarding seafarers appraisal reports, seafarers performance, attitude and behavior towards related tasks and inform/motivate the crew accordingly; 3) to identify areas of improvement required for seafarers in order to retrain and educate and to inform the seafarer to attend such training needs during their vacation leave; 4) to hold meetings with seafarers on individual basis onboard and assist to solve any complaints such as regular payment of wages, salary remittances, allotments, flag lic requirements, and resolve any disputes such as seafarer’s relief plan, rejoining status, working atmosphere on board and to ensure seafarers are well cared and looked after; 5) to check if the provisions and stores are being supplied as per the requirement of principals; 6) to make tour reports of vessel visits and suggestions for improvements and address concerns which may have a negative impact of the working environment on board the vessel; 7) to motivate seafarers to remain with the same company and increase the percentage of repeat crew whom are familiar with the principal, ship management system, and route of the vessel which increases the efficiency, quality of work and reduces chances injury or accidents; 8) to maintain liaison with all parties concerned ashore for a smooth turn out of the vessel and to minimize the port stay of the vessel; 9) to observe the maintenance of the vessel, the performance of the seafarers and make reports accordingly; 10) to instruct and discuss with management ranks of the vessel regarding specific complaints, comments received from owners of the vessel and how best to achieve desired results requested by its owners/clients; 11) to mitigate circumstances and avoiding conflict between Bangladeshi crew and other nationality of crew of the management/ship-owners/charterers and their agents; 12) to motivate the crew to act in the interest of Ship owners in order to secure their future employment and in return increase the business opportunities of Marine Manning Svcs Ltd.; and 13) to encourage crew in the participation of the safety management system and ISPS compliance of the company on the subject vessel while the vessel is under way. ISSUE: Whether the subject individuals are “passengers” 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- (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. 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. In the present case, you state that the subject individuals will be transported on the vessel for the purpose of performing the following activities: 1) to visit vessels at USA ports and meet and discuss with the seafarers serving onboard such vessels on behlaf of principal; 2) to discuss with master and Chief Engineer of the vessel regarding seafarers appraisal reports, seafarers performance, attitude and behavior towards related tasks and inform/motivate the crew accordingly; 3) to identify areas of improvement required for seafarers in order to retrain and educate and to inform the seafarer to attend such training needs during their vacation leave; 4) to hold meetings with seafarers on individual basis onboard and assist to solve any complaints such as regular payment of wages, salary remittances, allotments, flag lic requirements, and resolve any disputes such as seafarer’s relief plan, rejoining status, working atmosphere on board and to ensure seafarers are well cared and looked after; 5) to check if the provisions and stores are being supplied as per the requirement of principals; 6) to make tour reports of vessel visits and suggestions for improvements and address concerns which may have a negative impact of the working environment on board the vessel; 7) to motivate seafarers to remain with the same company and increase the percentage of repeat crew whom are familiar with the principal, ship management system, and route of the vessel which increases the efficiency, quality of work and reduces chances injury or accidents; 8) to maintain liaison with all parties concerned ashore for a smooth turn out of the vessel and to minimize the port stay of the vessel; 9) to observe the maintenance of the vessel, the performance of the seafarers and make reports accordingly; 10) to instruct and discuss with management ranks of the vessel regarding specific complaints, comments received from owners of the vessel and how best to achieve desired results requested by its owners/clients; 11) to mitigate circumstances and avoiding conflict between Bangladeshi crew and other nationality of crew of the management/ship-owners/charterers and their agents; 12) to motivate the crew to act in the interest of Ship owners in order to secure their future employment and in return increase the business opportunities of Marine Manning Svcs Ltd.; and 13) to encourage crew in the participation of the safety management system and ISPS compliance of the company on the subject vessel while the vessel is under way. 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 onboard to contribute to the accomplishment of the operation or navigation of the vessel during the voyage or are onboard because of a necessary vessel ownership or business interest during the voyage. (See HQ 101699 [November 5, 1975]; see also HQ 116721 [September 25, 2006], quoting HQ 101699.) 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 116721, supra; and see HQ 116659 [May 19, 2006], referencing the “direct and substantial” test.) In the present case, we find that the proposed activities described in your request would be directly and substantially connected with the business operations of the vessel and we therefore determine that the subject individuals are not “passengers” within the meaning of 46 U.S.C. § 55103 and 19 CFR § 4.50(b). Accordingly, the coastwise transportation of the individuals in question would not be 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 CFR § 4.50(b). Therefore, the coastwise transportation of such individuals is not in violation of 46 U.S.C. § 55103. Sincerely, Lisa L. Burley Chief/Supervisory Attorney-Advisor Cargo Security, Carriers and Restricted Merchandise Branch Office of International Trade, Regulations & Rulings U.S. Customs and Border Protection