Coastwise trade; Dredging; Foreign vessels; Territorial waters; 46 U.S.C. App. 292 and 883

October 17, 1994 HQ 113219 VES-3-CO:R:IT:C 113219 LLB CATEGORY: Carriers Mr. Robert W. Crandall Maritime Research Bureau RR #1, Box 3714 Alta, Wyoming 83422-9607 Re: Coastwise trade; Dredging; Foreign vessels; Territorial waters; 46 U.S.C. App. 292 and 883 Dear Mr. Crandall: Reference is made to your letter of August 30, 1994, in which you request a ruling regarding the proposed use of Chinese vessels in a dredging project to be conducted in California. FACTS: It is proposed that Chinese-built dredge vessels and dredge barges be operated in a joint-venture with an American dredging concern, and be employed in an Army Corps of Engineers project. The project would involve the use of the vessels in dredging ship channels in the Port of Oakland, California. The dredged material would be transported to any of three sites, two of them on land and a third located some 50 miles from San Francisco Bay. It is stated that the vessels would be manned by Americans. ISSUE: Whether the dredging and transportation statutes of the United States prohibit the use of foreign vessels in dredging and hauling activities conducted within the waters under the jurisdiction of the United States. LAW AND ANALYSIS: Title 46, United States Code App., section 292, provides that with one execption not applicable in the present case, vessels may not dredge in the navigable waters of the United States unless they meet the requirements of 46 U.S.C. App. 883. Title 46, United States Code App., section 883, provides, in pertinent part, that: - 2 - No merchandise shall be transported by water, or land and water, on penalty of forfeiture thereof, between points in the United States, including Districts, Territories, and possessions thereof embraced within the coastwise laws, either directly or via a foreign port, or for any part of the transportation, in any other vessel than a vessel built in and documented under laws of the United States and owned by persons who are citizens of the United States... By the Act of June 7, 1988, (Pub. L. 100-329, 102 Stat. 588), section 883 was amended to provide: That for purposes of this section, the term "merchandise" includes valueless material: Provided further, That this section applies to the transportation of valueless material or any dredged material regardless of whether it has commercial value, from a point or place in the United States or a point or place on the high seas within the Exclusive Economic Zone as defined in the Presidential Proclamation of March 10, 1983, to another point or place in the United States or a point or place on the high seas within that Exclusive Economic Zone. Points and places in the United States include all areas within the three mile territorial waters of the United States, and the Exclusive Economic Zone encompasses an area extending 200 miles from the U.S. coastline. All of these provisions, taken together, combine to prohibit your proposal in that only properly qualified and documented U.S.-flag vessels may be used to dredge and to haul dredge spoil within the geographic confines which have been identified. HOLDING: The use of Chinese-built vessels to engage in dredging and dredge spoil transportation activities within the waters under United States jurisdiction is prohibited by statute. Sincerely, Arthur P. Schifflin Chief Carrier Rulings Branch