HQ 0109716 - Applicability of Public Law 100-239 (Anti Reflagging Act of 1987), Amending the Definition of "Fisheries" in 46 U.S.C. 12101, to Fixed-Position Foreign-Built, Foreign- Flag Processing Vessel - United States International Trade Commision Rulings

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HQ 109716

October 4, 1988

VES-7-02 CO:R:P:C 109716 LLB

CATEGORY: CARRIER

Mr. Greg Fisk
Maretec Alaska
130 Seward Street, No. 405
Juneau, Alaska 99801

RE: Applicability of Public Law 100-239 (Anti Reflagging Act of 1987), Amending the Definition of "Fisheries" in 46 U.S.C. 12101, to Fixed-Position Foreign-Built, Foreign- Flag Processing Vessel

Dear Mr. Fisk:

This is in response to your letter of August 29, 1988, in which you request a ruling on the possible use of a foreign- built and registered fish processing vessel in a near-shore remote location in Alaska.

FACTS:

It is your plan to purchase the subject vessel and take various steps to ensure that it will not be susceptible to use in the transportation of fish or other materials. You indicate that you will accomplish this through the following means:

1. disabling or removing steering gear and rudder;

2. disabling or removing propulsion machinery (propellers and shafts), save that main engines would remain as generator units;

3. permanently fixing the vessel in place by means of piles and/or fixed anchors;

4. provision of permanent access from shore to/from the vessel for vehicles and pedestrians; and

5. connection of the floating dock to shore water utility and inter-connecting the vessel's electrical generating capacity with the shore utility.

It is our understanding that the steps listed above will be accomplished once the vessel is in the U.S., and that at the time it arrives it will be an operational processing vessel. As such, the vessel would be exempt from consumption entry and payment of tariff duties under the Tariff Schedules of the United States (TSUS) by operation of General Headnote 5(g), thereof (19 U.S.C. 1202, General Headnote 5(g)).

ISSUE:

Two issues are presented for resolution. The first is whether, following the various disabling operations detailed above, the processor may properly be considered a "vessel" within the contemplation of title 46, United States Code App. section 12101, as amended by Pub. L. 100-239 (101 Stat 1778), commonly known as the Anti-Reflagging Act of 1987.

The second issue is whether a non-qualified vessel operating as a fish processing plant from a stationary position, is operating in violation of the amended statute.

LAW AND ANALYSIS:

The primary purpose of the Commercial Industry Vessel Anti-Reflagging Act of 1987 (Pub. L. 100-239; 101 Stat 1778), was to preclude the use of foreign-built processing vessels in U.S. waters, including those within the United States Exclusive Economic Zone (EEZ). By detailing such extensive disabling measures it is no doubt sought to be established that the processor, once in use as such, should not be regarded as a "vessel" meant to be proscribed from operation by statute.

Section 12101 of title 46, United States Code App. (46 U.S.C. App. 12101), the statute amended by the Anti-Reflagging Act, does not define the term "vessel". Section 12101 is contained within Subtitle II of title 46 which does contain a general definition section at section 2101, wherein it is provided that "'vessel' has the same meaning given that term in section 3 of title 1." (46 U.S.C. App. 2101(45))

Section 3 of title 1, United States Code (1 U.S.C. 3), provides, in its entirety:

The word "vessel" includes every description of water craft or other artificial contrivance used, or capable of being used, as a means of transportation on water.

The definition has been cited in a significant body of
court cases. The factors which are generally determinative in deciding whether a structure is considered a "vessel" are well set forth in the case of McCarthy v. The Bark Peking, 716 F.2d 130 (1983). The court in that case interpreted the definition of vessel in 1 U.S.C. 3, albeit for a different purpose than that presently under consideration. The facts concerning the condition and use of the PEKING are, however, quite relevant to this inquiry. The PEKING was a museum vessel on exhibit at the South Street Seaport Museum in New York. Its rudder had been welded in one position and it had not put to sea under its own power for half a century. The court found the section 3 definition of vessel to be applicable, stating:

...virtually any capacity for use as seagoing transportation - perhaps even the hypothetically plausible possibility - has sufficed to lend the dignity of "vessel" status to a host of seemingly unlikely craft. McCarthy, supra., at 134.

It is the residual capacity for use as a vessel, even if a remote capacity under tow, that retains for a vessel that status.

Most closely resembling the facts here under consideration were those before the court in the case of Pleason v. Gulfport Shipbuilding Corporation, 221 F.2d 621 (1955), a case where the court considered whether a former U.S. Navy vessel, converted to a stationary shrimp processing plant was, in fact, a vessel within the meaning of 1 U.S.C. 3. The vessel had no propellers or shaft, no crew, no operable machinery, no light, heat or power in operation. The main engines and steering apparatus, with the exception of the rudder, had been removed. It was lashed to shore by ropes and steel cables from which stationary position it processed shrimp. Telephone and electricity were supplied from shore facilities. Even so, the court found it to be a vessel since it retained that elusive residual capacity to be used as a vessel. In the words of the court it "...definitely was capable of being used as a means of transportation under tow." (Pleason, supra., at 623) The definition of "vessel" within the meaning of 1 U.S.C. 3 has been very broadly construed, even to the point of moving one court to find that:

No doubt the three men in a tub would also fit within our definition, and one probably could make a convincing case for Jonah inside the whale. Burks v. American River Transportation Company, 697 F.2d 69 (1982), at p. 75.

The incoming ruling request states that the amendments known as the Anti-Reglagging Act, "...specifically preclude the use of foreign vessels in processing at sea." Our reading of the amended definition of "fisheries" now appearing in 46 U.S.C. 12101(a)(1), reveals restrictions on mere processing "in the navigable waters" of the United States. The statute does not contemplate that a vessel need be at sea, or even underway in order to come within the orbit of its restrictions. It is enough that it performs its processing function while located in navigable waters.

HOLDING:

In light of the broad scope applied by courts to the definition of a "vessel" appearing in 1 U.S.C. 3 (made applicable to 46 U.S.C. App. 12101 through 46 U.S.C. App. 2101 (45)), and, further, based upon the clear and unambigous wording of the definition of "fisheries" appearing in 46 U.S.C. App. 12101, we find that the foreign-built fish processing vessel here under consideration may not operate from a permanently stationary position in the navigable waters of the United States.

Sincerely,

John E. Elkins

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