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 H255561 July 25, 2014 VES-3-02-OT:RR:BSTC:CCR HQ H255561 DAC CATEGORY: Carriers Gene Creech Wilmington Shipping Company 330 Shipyard Blvd. Wilnington, NC 28490 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b) Dear Mr. Creech: This letter is in response to your correspondence of July 24, 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/V GINGAH CHEETAH (the “vessel”), from Wilmington, North Carolina, to Jacksonville, Florida from on or about July 27, 2014, through on or about July 31, 2014. The individual would be transported for the purpose of performing the following activities:; 1) 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; 2) 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; 3) to hold meetings with seafarers on an 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; 4) to check if the provisions and stores are being supplied as per the requirement of principals; 5) 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; 6) 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; 7) 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; and 8) 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; on the subject vessel while the vessel is under way. 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 will be transported on the vessel for the purpose of performing the following activities:; 1) 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; 2) 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; 3) to hold meetings with seafarers on an 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; 4) to check if the provisions and stores are being supplied as per the requirement of principals; 5) 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; 6) 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; 7) 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; and 8) 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; 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 individual is not a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 CFR § 4.50(b). Accordingly, the coastwise transportation of the individual in question would not be in violation of 46 U.S.C. § 55103. HOLDING: The subject individual is not a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 CFR § 4.50(b). Therefore, the coastwise transportation of such individual 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