HQ 0113156 - Coastwise trade; salvage; 46 U.S.C. App 316(d) - United States International Trade Commision Rulings

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HQ 113156

July 8, 1994

VES-10-01-CO:R:IT:C 113156 BEW

CATEGORY: CARRIER

Captain H. Doug Wilson, III
Research & Recovery, Inc.
6247 108 Avenue North
Pinellas Park, Florida 34666

RE: Coastwise trade; salvage; 46 U.S.C. App 316(d)

Dear Captain Wilson:

This is in response to your letter of July 7, 1994, which requests a ruling regarding the use of a foreign-flag vessel in salvage operations on the "ATOCHA" located at Latitude 20o 30' 01"N and Longitude 82o 15' 53"W, a point outside the territorial waters of the United States.

FACTS:

You state that you are sub-contractors of the Mel Fisher Maritime Heritage Corporation currently doing salvage on the "ATOCHA" location. You state that you are using the "WARM WIND", a 96 foot Honduras-flag vessel to assist in the subject salvaging operation. You state that the "WARM WIND" will be under your command and will be working American citizens. You state that the subject vessel will be at anchor at all times, never working more than 100 yards from the above stated location. Your letter does not state which vessel will be used for the transportation of recovered artifacts to a U.S. port of entry.

ISSUE:

Whether the use of a foreign-flag vessel as a base for treasure hunting operations outside the territorial waters of the United States is a violation of U.S. coastwise laws.

LAW AND ANALYSIS:

Paragraph (d) of the Act of June 11, 1940, as amended (46 U.S.C. App. 316(d)), provides, in pertinent part, that:

No foreign vessel shall, under penalty of forfeiture, engage in salvaging operations on the Atlantic or Pacific coast of the United States, in any portion of the Great Lakes or their connecting or tributary waters, including any portion of the Saint Lawrence River through which the international boundary line extends, or in territorial waters of the United States on the Gulf of Mexico, except when authorized by a treaty or in accordance with the provisions of [46
U.S.C. App. 725] ...

Similarly, Customs regulations (19 CFR 4.97) prohibit salvage "in territorial waters of the U.S." by vessels other than a vessel of the U.S., a numbered motorboat owned by a citizen, Mexican or Canadian vessels as authorized by treaty, or a vessel which has been granted special permission by the Commissioner of Customs by virtue of the unavailability of a suitable U.S. vessel.

In the facts before us, the foreign-flag vessel in question will be used solely as a base for treasure hunting operations and will remain outside the territorial waters of the United States at all times. We know of no law or regulation enforced by this agency that would prohibit this proposed usage.

The coastwise laws pertaining to the transportation of merchandise and passengers (46 U.S.C. 883 and 289, respectively) prohibit the use of any vessel other than a vessel built in, owned by citizens of, and documented in the United States to transport merchandise or passengers between points in the United States embraced within the coastwise laws.

In interpreting the coastwise laws, Customs has ruled that a point in United States territorial waters is considered a point embraced within the coastwise laws. The coastwise laws generally apply to points in the territorial sea, defined as the belt, three (3) nautical miles wide, seaward of the territorial sea baseline, and to points located in internal waters, landward of the territorial sea baseline, in cases where the baseline and the coastline differ.

It should be noted that, while the restrictions against foreign vessels in salvage operations and coastwise trade apply only when the activity occurs in waters under the jurisdiction of the United States, the provision granting free importation of merchandise recovered from sunken and abandoned vessels also applies only to operations conducted within the territorial waters of the United States. The U.S. Code, in section 1310 (19 U.S.C. 1310) provides that:

Whenever any vessel laden with merchandise, in whole or in part subject to duty, has been sunk in any river, harbor, bay, or waters subject to the jurisdiction of the United States, and within its limits, for the period of two years and is abandoned by the owner thereof, any person who may raise such vessel shall be permitted to bring any merchandise recovered therefrom into the port nearest to the place where such vessel was so raised free from the payment of any duty thereupon, but under such regulations as the Secretary of the Treasury may prescribe.

Under the facts before us, all recovery of treasure and artifacts will take place outside the territorial waters of the United States. Therefore, any artifacts recovered may not enter the United States duty-free under this provision. Any questions as to the classification of such artifacts upon entry into the United States should be sent to the following address:

Mr. John Durant
Director, Commercial Rulings Division
U.S. Customs Service
1301 Constitution Ave.
Washington, D.C. 20229

The necessary procedure for entry into the United States for vessels is supplied by sections 431 through 434 of the Tariff Act of 1930, as amended (19 U.S.C. 1431 et al.). A copy of these sections has been enclosed for your reference.

HOLDING:

A foreign-flag vessel may be used as a base for treasure hunting operations outside the territorial waters of the U.S. without violating the coastwise laws of the United States.

Sincerely,

Arthur P. Schifflin

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