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HQ 112723


May 26, 1993

VES-3-19-CO:R:IT:C 112723 DEC

CATEGORY: CARRIER

Mr. Ted Simpson
Spinakker Sports
Box 142
Mikana, Wisconsin 54857

RE: Sailing Instructions; 46 U.S.C. app. 289; 46 U.S.C. app. 883

Dear Mr. Simpson:

This ruling is in response to your correspondence with the Carrier Rulings Branch in which you inquired whether your sailing vessel, the SKAGERRAK, may be used for training purposes.

FACTS:

The SKAGERRAK is a foreign-built, United States-registered vessel. In your letter, you indicated that you intend to offer sailing lessons in the Apostle Islands using the SKAGERRAK and question whether your vessel may legally engage in such an activity.

ISSUE:

Whether a foreign-built, United States-registered vessel may be used to offer sailing instruction.

LAW AND ANALYSIS:

The coastwise laws generally prohibit the transportation of passengers or merchandise between points in the United States embraced within the coastwise laws in any vessel other than a United States built, owned, and documented vessel. 46 U.S.C. app. 289 (Supp. 1992) & 46 U.S.C. app. 883 (Supp. 1992). Points in the United States embraced within the coastwise laws include the United States territorial waters. The territorial waters of the United States consist of the territorial sea, defined as the belt, three nautical miles wide, seaward of the territorial sea baseline, and of the internal waters of the United States, landward of the territorial sea baseline, in cases where the baseline and the coastline differ. Headquarters Ruling 111275 (Nov. 13, 1990).

The Customs Regulations define "passenger" for purposes of section 289 as "any person carried on a vessel who is not connected with the operation of such vessel, her navigation, ownership, or business." 19 C.F.R. 4.50(b)(1992). The Customs Service has held that a person being trained or receiving instruction in the handling or navigation of a vessel, and whose presence on board the vessel is required in order to receive such training or instruction, is not a "passenger" within the coastwise laws. Accordingly, if the vessel is used only for such training, then it would not be required to have a license to engage in the coastwise trade. See Headquarters Ruling 109850 (Dec. 27, 1988) and Headquarters Ruling 109287 (Feb. 24, 1988).

Therefore, the sole use of a foreign-built sailing vessel in connection with a bona fide instructional course in sailing and navigation with class or other instruction, as opposed to an outing, does not constitute coastwise trade within the meaning of 46 U.S.C. app. 289. From your description, everyone transported by the vessel will either be part of the regular crew or be part of the training crew. Their transportation is, therefore, permitted. We stress, however, that all persons being carried in the vessel must be involved with the operation, navigation, or business of the vessel. Persons who are carried on board a vessel for recreational purposes, whether or not they pay a fee, would be considered "passengers," and their carriage between places in the United States or entirely within United States waters would be in violation of the coastwise laws.

HOLDING:

The sole use of a foreign-built, United States-registered sailing vessel in connection with a bona fide instructional course in sailing and navigation with appropriate instruction and training is not coastwise trade in violation of 46 U.S.C. app. 289.

This ruling addresses only those federal requirements that are administered by the United States Customs Service. While we are unaware of any other federal or state agency requirements that might pertain to the undertaking you describe, it is possible that such requirements exist.

Sincerely,

Acting Chief

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