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HQ 112820

September 14, 1993

VES-4-02-CO:R:IT:C 112820 DEC

CATEGORY: CARRIER

Mr. Bene Hoffman
Regional Manager
Stichting Marine Services, Washington
1436 U Street, N.W.
Washington, D.C. 20009

RE: Cruising license; 19 U.S.C. app. 104; 19 C.F.R. 4.94; Pleasure

Dear Mr. Hoffman:

This is in response to your July 26, 1993, letter seeking reinstatement of the cruising license for the M/V GREENPEACE. Our ruling on this request is set out below.

FACTS:

The M/V GREENPEACE is a Netherlands flag motor yacht which its owner, Stichting Rubicon, is chartering to Stichting Marine Services for the 1993 calendar year. Greenpeace U.S.A. is currently chartering the M/V GREENPEACE from Stichting Marine Services, but a written charter contract does not exist. Greenpeace U.S.A. reimburses Stichting Marine Services for various costs such as fuel for outboard engines and inflatables, communication used by the campaigns, and rent of extra gangway for open boat events. While this list is not all inclusive, it is representative of the reimbursable costs.

The M/V GREENPEACE applied for and received a cruising license on June 15, 1993 from the United States Customs Service in Key West, Florida. On July 1, 1993, the GREENPEACE arrived in Charleston, South Carolina. According to a Customs official in Charleston, the visit of the vessel was a well publicized promotion of the Greenpeace organization's stance on environmental issues. The public was invited to tour the vessel, voluntarily contribute to the Greenpeace organization, attend workshops/seminars on various environmental issues, and obtain various printed materials detailing other environmental problems.

On July 7, 1993, a Customs official boarded the GREENPEACE and requested the surrender of their cruising permit. Subsequently, the master of the vessel made formal entrance and clearance under the commercial procedures.

ISSUE:

Whether a motor yacht registered in a country contained in 19 C.F.R. 4.94 engaged in a multi-city tour promoting a particular cause may be considered to be engaged exclusively for pleasure making it eligible for a cruising license pursuant to 46 U.S.C. 104.

LAW AND ANALYSIS:

Title 46, United States Code, appendix, section 104 (46 U.S.C. app. 104), authorizes the issuance of cruising licenses to pleasure vessels of countries which extend reciprocal privileges to United States pleasure vessels. The Netherlands is such a country. Title 19, Code of Federal Regulations, section 4.94 (19 C.F.R. 4.94) addresses the issuance of cruising licenses which exempt foreign yachts from formal entry and clearance procedures. The license is granted subject to the condition that the vessel will not engage in trade or violate the laws of the United States in any respect. It has long been Customs position that vessels operating with cruising licenses are prohibited from engaging in foreign trade, the Great Lakes trade, the fisheries, or any other type of trade, including chartering. Emphasis added. More specifically, 46 U.S.C. app. 104 states that:
the Commissioner of Customs may authorize and direct the customs authorities at the various ports of entry of the United States to allow yachts from such foreign port used and employed exclusively as pleasure vessels to arrive at and depart from any port of the United States . . . without the payment of any charges for entering or clearing . . ..

46 U.S.C. app. 104 (1992).

We cannot characterize the use of the M/V GREENPEACE in the United States as a means to promote environmental awareness as a use exclusively for pleasure. The term pleasure is defined to be:

1. An enjoyable sensation or emotion; delight. 2. A source of enjoyment. 3. Amusement, diversion, or worldly enjoyment. 4. Sensual gratification or indulgence . . ..

The American Heritage Dictionary 951 (2d ed. 1985).

While we recognize that the participants of the voyage may derive pleasure from their experiences, the purpose of the voyage and use of the vessel is not exclusively for the pleasure of the participants. See Headquarters Ruling 111796 (Aug. 8, 1991). The
voyage enjoys the financial sponsorship of the Greenpeace-related organizations while its apparent goal is to promote Greenpeace's fight against the world's numerous environmental hazards as evidenced by the literature that was distributed, the workshops/seminars on current environmental issues, and the requests for voluntary financial support of Greenpeace.

The revocation of the GREENPEACE's cruising permit in Charleston, South Carolina, was justified on the basis that the vessel was not being used exclusively for pleasure. In addition, there is evidence in the record indicating that the vessel may have been engaged in trade and violated the passenger coastwise law. Since the provisions of the cruising license explicitly forbid the vessel from engaging in trade and from violating any United States law, either of these violations may serve as an additional basis to revoke the cruising license. Customs is not relying on these two potential violations in upholding the revocation of the GREENPEACE's cruising license because there is a lack of conclusive evidence, but offers them as potential alternate bases on which to uphold the revocation.

First, 19 C.F.R. 4.94(c) sets forth the qualifications for eligible vessels wishing to obtain cruising licenses. More specifically, it provides that a cruising license shall be granted subject to the condition that the vessel not engage in trade. Customs has consistently held that this provision forbids the vessel from participating in foreign trade, the Great Lakes trade, the fisheries, or any other type of trade, including chartering. Headquarters Ruling 106247 (Nov. 9, 1983). Since there is no written charter agreement between Greenpeace U.S.A. and Stichting Marine Services, the presumption is that it is a time or voyage charter. Consequently, the issue of whether the GREENPEACE is engaged in chartering activities which constitutes an engagement in trade is suspect.

Second, 19 C.F.R. 4.94(c) states that a cruising license shall not be granted to a vessel in violation of any law of the United States. Title 46, United States Code, appendix, section 289 (46 U.S.C. app. 289) expressly prohibits a foreign vessel from transporting "passengers between ports or places in the United states, either directly or by way of a foreign port . . .." 19 U.S.C. app. 289 (1992). 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)(1993). Based on the crew lists submitted, there is a potential passenger coastwise law violation. The names of Cece Fadope and Steve Shalhorn are listed on the crew list upon departure from Charleston bound for Norfolk. The crew list upon departure from Norfolk bound for New York does not include these two names. More importantly, these two individuals are identified in the crew list as campaigners. It appears that these individuals are in no way connected to the operation, navigation, or business of the vessel.

Pending a Norfolk Customs investigation into whether these two individuals are passengers rather than members of the vessel's crew, a passenger coastwise penalty may issue. A coastwise law violation would be sufficient grounds to revoke a cruising license pursuant to 19 C.F.R. 4.94.

HOLDING:

The M/V GREENPEACE is ineligible for a cruising license given its current use as detailed in the Law and Analysis portion of this ruling. Therefore, it is not exempt from the entry and clearance laws administered by the Customs Service. The Customs Service in Charleston, South Carolina properly revoked the M/V GREENPEACE's cruising license.

Sincerely,

Stuart P. Seidel

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