Coastwise Trade; Crane Barge; 46 U.S.C. App. 289, 883

HQ 112173 May 21, 1992 VES-3-CO:R:IT:C 112173 GEV CATEGORY: Carriers Tom Dlubac Meramec Marine Shipyard Inc. 6789 Christopher Drive St. Louis, Missouri 63129 RE: Coastwise Trade; Crane Barge; 46 U.S.C. App. 289, 883 Dear Mr. Dlubac: This is in response to your letters dated March 26, 1992 and April 14, 1992 (the latter enclosing a photograph), requesting a ruling on the proposed use of a crane barge. Our ruling is set forth below. FACTS: Meramec Marine Shipyard Inc. ("Meramec"), a U.S. corporation located in St. Louis, Missouri, proposes to use a U.S.-built, self-propelled crane barge to provide repair and crane service to grain barges at a loading and discharge facility. The vessel, which was built in Meramec's yard, will be operated on waters located in the State of Missouri. ISSUE: Whether the use of a crane barge to provide repair and crane service to grain barges located on waters in the State of Missouri constitutes a use in the coastwise trade within the purview of 46 U.S.C. App. 289 or 883. LAW AND ANALYSIS: Title 46, United States Code Appendix, section 883 (the merchandise coastwise law often called the "Jones Act") prohibits the transportation of merchandise between United States coastwise points, either directly or via a foreign port, or for any part of the transportation, in any vessel other than a vessel built in and documented under the laws of the United States and owned by persons who are citizens of the United States (i.e., a coastwise- qualified vessel). - 2 - Pursuant to section 4.80b, Customs Regulations (19 CFR 4.80b), a coastwise transportation of merchandise takes place, within the meaning of the 46 U.S.C. App. 883, when merchandise laden at a point embraced within the coastwise laws ("coastwise point") is unladen at another coastwise point, regardless of the origin or ultimate destination of the merchandise. Title 46, United States Code Appendix, section 289 (46 U.S.C. App. 289, the passenger coastwise law), prohibits the transportation of passengers between points embraced within the coastwise laws of the United States, either directly or by way of a foreign port, in a non-coastwise-qualified vessel (i.e., any vessel not built in and documented under the laws of the United States and owned by persons who are citizens of the United States). For purposes of section 289, "passenger" is defined as "...any person carried on a vessel who is not connected with the operation of such vessel, her navigation, ownership, or business." (19 CFR 4.50(b)) In interpreting the coastwise laws, Customs has ruled that a point in United States territorial waters is a point in the United States embraced within the coastwise laws. The territorial waters of the United States consist of the territorial sea, defined as the belt, 3 nautical miles wide, seaward of the territorial sea baseline, and to points located in internal waters, landward of the territorial sea baseline, in cases where the baseline and the coastline differ. The Customs Service has long held that the use of a non- coastwise-qualified crane vessel to load and unload cargo or construct or dismantle a marine structure is not coastwise trade and does not violate the coastwise laws, provided, that any movement of merchandise is effected exclusively by the operation of the crane and not by movement of the vessel, except for necessary movement which is incidental to a lifting operation while it is taking place. Thus, such a crane barge could lift merchandise with its crane at one coastwise point, be pivoted while remaining in one location, and put down the merchandise at a place other than that from which it was lifted. The crane barge would be prohibited from lifting merchandise with its crane at one coastwise point while the merchandise is suspended from the crane, and placing the merchandise at a second coastwise point (see Customs ruling VES-3-CO:R:P:C 106351 PH, dated November 1, 1983; and VES-3/VES-10-01 CO:R:P:C 108213 PH, dated March 6, 1986). In regard to the vessel under consideration, due to the lack of specificity in the information submitted regarding the proposed repair and crane services, we are unable to render a definitive ruling as to whether these services constitute coastwise trade for purposes of the applicability of 46 U.S.C. App. 289 or 883. We note, however, that the crane barge is U.S.- - 3 - built and U.S.-owned. Accordingly, notwithstanding the lack of a definitive ruling on this matter, it is probable that the subject vessel would qualify for a certificate of documentation with a coastwise endorsement pursuant to 46 U.S.C. 12106. In view of the fact that this statute is administered by the U.S. Coast Guard, we suggest that you contact that agency regarding this matter. HOLDING: The use of a crane barge to provide crane and repair services to grain barges at a loading and discharge facility located in the State of Missouri may or may not constitute a use in the coastwise trade within the purview of 46 U.S.C. App. 289 or 883. The lack of specific information regarding the proposed operations under consideration precludes Customs from rendering a definitive ruling in this matter. However, since the crane barge is U.S.-built and owned, it appears to qualify for a certificate of documentation endorsed for the coastwise trade pursuant to 46 U.S.C. 12106. We defer to the U.S. Coast Guard in this regard since that agency administers the vessel documentation laws of the United States. Sincerely, B. James Fritz Chief Carrier Rulings Branch