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 H254260 June 9, 2014 VES-3-02-OT:RR:BSTC:CCR HQ H254260 WRB CATEGORY: Carriers Ms. Lois Hoffman Holland America Line 300 Elliot Avenue West Seattle, WA 98119 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b) Dear Ms. Hoffman: This letter is in response to your correspondence of June 5, 2014, with respect to the coastwise transportation of one individual. Our ruling is set forth below. FACTS: You ask whether one individual may be transported on the non-coastwise-qualified M/S VOLENDAM (the “vessel”). The subject individual will embark the vessel at Vancouver, British Columbia, Canada, on or about June 25, 2014, and disembark at Juneau, Alaska, on or about June 27, 2014. The individual would be transported for the purpose of auditing all onboard dining outlets and training the dining supervisors, managers, and dining wait staff while the vessel is underway. ISSUE: Whether the subject individual is a “passenger” 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 individual would be transported for the purpose of auditing all onboard dining outlets and training the dining supervisors, managers, and dining wait staff while the vessel is underway. 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.) Regarding the individual intending to embark at Vancouver, British Columbia, Canada, and disembark at Juneau, Alaska, we find that no coastwise transportation would occur. In accordance with 46 U.S.C. § 55103(a), transportation of individuals, regardless of status, on a non-coastwise-qualified vessel, is not violative of that statute when the transportation is not between two different points embraced within the coastwise laws of the United States. Vancouver, British Columbia, being a foreign port, is not a point embraced within the coastwise laws. The subject individual will be transported from Vancouver to Juneau without disembarking at another coastwise point. As such, no coastwise transportation would occur. Therefore, the proposed transportation of the individual at issue is not in violation of 46 U.S.C. § 55103. HOLDING: The proposed transportation of the individual embarking at Vancouver, British Columbia, Canada, on June 25, 2014, and disembarking in Juneau, Alaska, on or about June 27, 2014, is not a coastwise movement. Therefore the proposed transportation is not in violation of 46 U.S.C. § 55103. Sincerely, Lisa L. Burley Supervisory Attorney-Advisor/Chief Cargo Security, Carriers and Restricted Merchandise Branch Office of International Trade, Regulations & Rulings U.S. Customs and Border Protection