HQ 0111314 - Coastwise trade; Passenger transportation; Charter; Voyage to nowhere; Territorial sea; 46 U.S.C. App. 289 - United States International Trade Commision Rulings

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HQ 111314

May 21, 1991

VES-3-02-CO:R:IT:C 111314 LLB

CATEGORY: CARRIER

Mr. John W. Kelleigh
105 Draper Road
Wayland, Massachusetts 01778

RE: Coastwise trade; Passenger transportation; Charter; Voyage to nowhere; Territorial sea; 46 U.S.C. App. 289

Dear Mr. Kelleigh:

Reference is made to your letter of September 20, 1990, in which you ask that we reply regarding the proposed use of your 55-foot vessel in passenger charter operations.

FACTS:

The vessel in question is a 55-foot, steel hulled power boat, built in part in Holland in 1959. You propose to take the vessel from its current anchorage in Boston, Massachusetts, to Key West, Florida. It is your intention to offer two-hour charter cruises for up to fifteen (15) passengers who would embark at Key West, cruise beyond the territorial waters, and return to the point of embarkation for disembarkation. It is stated that no intermediate stops would be made during the course of any cruise.

ISSUE:

Whether passenger cruises originating and terminating at the same location, which proceed beyond the territorial waters during their course and which do not include any intermediate stops, are permissible under the coastwise trade passenger transportation statute.

LAW AND ANALYSIS:

The Act of June 19, 1886, as amended (24 Stat. 81; 46 U.S.C. App. 289, sometimes called the coastwise passenger law), provides that:

No foreign vessel shall transport passengers between ports or places in the United States either directly or by way of a foreign port, under a penalty of $200 for each passenger so transported and landed.

For your general information, we have consistently interpreted this prohibition to apply to all vessels except United States-built, owned, and properly documented vessels (see 46 U.S.C. 12106, 12110, 46 U.S.C. App. 883, and 19 C.F.R. 4.80).

In interpreting the coastwise laws as applied to the transportation of passengers, the Customs Service has ruled that the carriage of passengers entirely within territorial waters, even though the passengers disembark at their point of embarkation and the vessel touches no other point, is considered coastwise trade subject to the coastwise laws. However, the transportation of passengers to the high seas or foreign waters and back to the point of embarkation, assuming the passengers do not go ashore, even temporarily, at another United States point, often called a "voyage to nowhere," is not considered coastwise trade. The territorial waters of the United States consist of the territorial sea, defined as the belt, three nautical miles wide, adjacent to the coast of the United States and seaward of the territorial sea baseline.

The first of these positions, regarding transportation of passengers entirely within territorial waters on a voyage in which they embark and disembark at the same coastwise point is based on a 1900 decision (Treasury Decision 22275). Our rulings have consistently followed this position.

The second of these positions, regarding transportation of passengers from a point in the United States to the high seas or foreign waters and back to the same point, is based on a 1912 opinion of the Attorney General of the United States (29 Opinions of the Attorney General 318). We have consistently followed this position as well.

On the basis of the foregoing interpretations by the Customs Service, vessels not qualified to engage in the coastwise trade may be operated on voyages to nowhere in which passengers transported from a point in the United States to a point outside United States territorial waters and back to the point of the passengers' embarkation, assuming the vessel does not touch any other coastwise point. As stated above, this Customs interpretation is of long-standing duration and is based on an Opinion of the Attorney General of the United States. We are aware of no action by the Congress of the United States in all of the time this interpretation has existed indicating that our interpretation is contrary to the intent of the Congress in enacting the coastwise laws, although Congress has on various occasions since their enactment heard testimony on their application.
You should be aware, however, that voyages of vessels carrying offshore fishing parties for hire, regardless of whether trips extend beyond the three mile limit of the territorial waters, are considered to be predominantly coastwise in their nature and object. As such, non-coastwise-qualified vessels may not legally engage in such voyages. (Treasury Decision 55193(2)).

HOLDING:

A non-coastwise-qualified vessel may engage in the carriage of passengers for hire on voyages which originate and terminate at the same coastwise point, so long as such voyages proceed beyond the territorial sea and no stops are made at other coastwise points (including any point within the territorial waters), and so long as the voyage does not involve the carriage of fishing parties for hire.

Sincerely,

B. James Fritz

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