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

HQ H194359 November 28, 2011 VES-3-02-RR:BSTC:CCI H194359 WRB CATEGORY: Carriers Mr. Kenny Wong S5 / Norton Lilly International 5080 McLester Street APM Terminal (Control Bldg 3rd Fl.) Elizabeth, NJ 07201 RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b) Dear Mr. Wong: This letter is in response to your correspondence of November 23, 2011, with respect to the coastwise transportation of two individuals. Our ruling is set forth below. FACTS: You ask whether two individuals may be transported aboard the non-coastwise-qualified M/V OVERSEAS JOYCE, from Newark, New Jersey, to San Juan, Puerto Rico. The vessel will depart Newark on November 29, 2011, and arrive at San Juan on December 3, 2011. The individuals are to be carried onboard in the capacity of the owners’ superintendents to conduct an audit of the vessel in accordance with International Safety Management (ISM) facility code procedures, while the vessel is at sea. 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- is wholly owned by citizens of the United States for purposes of engaging in the coastwise traffic; and 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 are to be carried onboard in the capacity of the owners’ superintendents to conduct an audit of the vessel in accordance with International Safety Management (ISM) facility code procedures, while the vessel is at sea. Title 46 United States Code § 55104(b) provides, “Except as otherwise provided in this section, a vessel not qualified to engage in the coastwise trade may transport passengers between a port in Puerto Rico and another port in the United States.” Accordingly, the subject vessel, as a non-coastwise-qualified vessel, may transport passengers between Puerto Rico and other ports in the United States. Therefore, the transportation of two individuals on the subject vessel from Newark, New Jersey, to San Juan, Puerto Rico, is not a violation of the coastwise laws pursuant to 19 U.S.C. § 55104. HOLDING: The proposed itinerary described above, in which passengers embark at Newark, New Jersey, disembark the vessel at San Juan, Puerto Rico, is not a violation of the coastwise laws pursuant to 46 U.S.C. § 55104. Sincerely, George Frederick McCray Supervisory Attorney-Advisor/Chief Cargo Security, Carriers and Immigration Branch Office of International Trade, Regulations & Rulings U.S. Customs and Border Protection