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HQ 112216

May 20, 1992

VES-3-CO:R:IT:C 112216 LLB

CATEGORY: CARRIER

Mr. William A. Hoey
Blue Water Explorations, Ltd.
P.O. Box 114
Grosse Ile, Michigan 48138

RE: Coastwise trade; Passenger transportation; Great Lakes; Voyage to nowhere; 46 U.S.C. App. 289

Dear Mr. Hoey:

Reference is made to your letter of April 20, 1992, concerning the legality of operating a foreign-flag passenger vessel from and to the same United States port on the Detroit River.

FACTS:

It is reported that the operators of a Canadian-flag vessel intend to offer passenger harbor cruises on the Detroit River beginning this year. Passengers would be embarked at a dock in Detroit harbor, taken on a tour of the harbor, which reportedly would include at some point crossing the mid-point of the Detroit River which marks the international boundary between the United States and Canada, and returned to the original point of embarkation for discharge at the conclusion of the tour. The boundary on the Detroit River at the point under consideration is approximately 1100 feet from the dock facility in the United States.

ISSUE:

Whether traditional voyage to nowhere principles apply on voyages which proceed less than three miles from the United States but which do enter foreign territorial waters.

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.

The three-mile territorial sea limit is useful in defining the boundary between the territorial waters of the United States and the high seas. This limitation bears no relevance to circumstances in which the waters of the United States and those of a foreign nation are contiguous. This is true regardless of whether the point of contiguity is greater or lesser that three miles. In fact, Customs ruled in another case concerning passenger transportation on the Great Lakes, that since the international boundary was some 150 miles from the point of embarkation a voyage to nowhere would require a 300-mile round- trip (Customs Ruling 109815, December 5, 1988).

HOLDING:

A cruise to nowhere may involve a voyage which proceeds less than three miles outward from the United States, so long as a vessel enters the territorial waters of another nation. Such a cruise to nowhere is permitted to be accomplished with the use of a foreign-flag vessel.

Sincerely,

B. James Fritz

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