HQ 0113196 - 46 U.S.C. App. 316(a), 877, 883; 46 U.S.C. 12105; Coastwise Trade; Towing; Guam, American Samoa, Wake Island, Kingman Reef, Kwajalein, Marshall Islands, Johnston Island. - United States International Trade Commision Rulings

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HQ 113196

August 16, 1994

VES-10-03-COR:IT:C 113196 GOB

CATEGORY: CARRIER

Kevin P. Callahan
Victory Marine
6700 W. Marginal Way S.W.
Seattle, WA 98106

RE: 46 U.S.C. App. 316(a), 877, 883; 46 U.S.C. 12105; Coastwise Trade; Towing; Guam, American Samoa, Wake Island, Kingman Reef, Kwajalein, Marshall Islands, Johnston Island.

Dear Mr. Callahan:

This is in response to your letter dated August 12, 1994.

FACTS:

You ask the following questions.

1. May a U.S.-flag tug with a registry endorsement tow a U.S.-flag barge with a coastwise endorsement, which is laden with cargo: a. from a U.S. port to Hawaii? b. from a U.S. port to Alaska? c. from a U.S. port to Guam, American Samoa, Wake, Kwajalein, Kingman Reef, Johnston Island or between said islands?

2. May a foreign-flag tug tow a U.S.-flag barge with a coastwise registry from a U.S. port on a voyage to a foreign port: a. to another U.S. port and pick up cargo? b. to another U.S. port where the tug will pick up fuel, lube, and other necessaries?

3. May a foreign-flag tug tow a U.S.-flag barge with a coastwise registry from a U.S. port to Guam?

ISSUES:

Do the coastwise laws permit the various activities described supra.

LAW AND ANALYSIS:

We note initially, and we emphasize, that this ruling applies only to laws administered by the Customs Service. Certain of the proposed activities may come within the scope of laws administered by the U.S. Coast Guard.

Generally, the coastwise laws prohibit the transportation of passengers or merchandise between points in the United States embraced within the coastwise laws in any vessel other than a vessel built in, documented under the laws of, and owned by citizens of the United States.

The coastwise laws generally apply to points in the territorial sea, which is defined as the belt, three nautical miles wide, seaward of the territorial sea baseline, and to points located in internal waters, landward of the territorial sea baseline.

46 U.S.C. App. 883, the coastwise merchandise statute often referred to as the "Jones Act", provides in part:

No merchandise...shall be transported by water, or by land and water, on penalty of forfeiture of the merchandise (or a monetary amount up to the value thereof as determined by the Secretary of the Treasury, or the actual cost of the transportation, whichever is greater, to be recovered from any consignor, seller, owner, importer, consignee, agent, or other person or persons so transporting or causing said merchandise to be transported), between points in the United States...either directly or via a foreign port, or for any part of the transportation, in any other vessel than a vessel built in and documented under the laws of the United States and owned by persons who are citizens of the United States....

46 U.S.C. App. 316(a) prohibits the use of a non-coastwise- qualified vessel to tow any vessel, other than a vessel in distress, between ports or places in the United States embraced within the coastwise laws, either directly or by way of a foreign port, or to do any part of such towing, or to tow any such vessel between points in a harbor of the United States.

Pursuant to 46 U.S.C. App. 877, the coastwise laws are applicable to island territories and possessions of the United States.

However, 46 U.S.C. 12105(b) states:

A vessel for which a registry endorsement is issued may be employed in foreign trade or trade with Guam, American Samoa, Wake, Midway, or Kingman Reef.

Question #1
a. and b. Pursuant to 46 U.S.C. App. 316(a), a U.S.-flag tug with a registry endorsement may not tow a barge from a U.S. port to either Hawaii or Alaska. Such towing may only be accomplished by a coastwise-qualified vessel.

Because the U.S.-flag barge is coastwise-qualified, it may transport merchandise between coastwise points. This is true for all of the scenarios which you present since in all of those scenarios state the barge has a coastwise endorsement.
c. 1. Pursuant to 46 U.S.C. 12105(b), a U.S.-flag tug with a registry endorsement may tow a barge between a U.S. port and Guam, American Samoa, Wake, or Kingman Island. Similarly, pursuant to 46 U.S.C. 12105(b), a U.S.-flag tug with a registry endorsement may tow a barge between Guam, American Samoa, Wake, and/or Kingman Reef.
c. 2. Kwajalein is an atoll in the Marshall Islands.

Application of United States law to the Republic of the Marshall Islands is governed by Article VII of the Compact of Free Association between the United States and the governments of the Republic of the Marshall Islands and the Federated States of Micronesia (the "Compact"), as approved in the Compact of Free Association Act of 1985. Pursuant to section 171 of the Compact:

Except as provided in this Compact or its related agreements, the application of the laws of the United States to the Trust Territory of Pacific Islands by virtue of the Trusteeship Agreement ceases with respect to the Republic of the Marshall Islands and the Federated States of Micronesia as of the effective date of this Compact.

The Compact makes no provision for the application of the coastwise laws, including the coastwise towing statute, to the Republic of the Marshall Islands. Furthermore, we are aware of no agreement extending the coastwise laws of the United States to the parties of the Compact. By Presidential Proclamation, the President of the United States declared that, as of October 21, 1986, the Republic of the Marshall Islands is self-governing and no longer subject to the Trusteeship and that the Compact of Free Association is in effect. Proclamation No. 5564, 51 Fed. Reg. 40399 (1986). Accordingly, the coastwise laws are not applicable to the Marshall Islands.

Thus, there is no coastwise law prohibition with respect to transportation or towing between (a) Kwajalein and (b) a U.S. port, Guam, American Samoa, Wake, Kingman Reef, or Johnston Island.
c. 3. Johnston Island is a coastwise point. Accordingly, as in a. and b., pursuant to 46 U.S.C. 316(a), a U.S.-flag tug with a registry endorsement may not tow a barge between Johnston Island and another coastwise point, including a U.S. port. However, pursuant to 46 U.S.C. 12105(b), such a tug, which is not coastwise- qualified, may tow a barge between Johnston Island and the following points: Guam, American Samoa, Wake, and Kingman Reef. Further, as stated in c. 2., because the coastwise laws are not applicable to Kwajalein, such a tug, which is not coastwise- qualified, may tow a barge between Johnston Island and Kwajalein.

Question #2
a. A foreign-flag tug may tow a U.S.-flag barge with a coastwise endorsement on a voyage that commences in a U.S. port, stops at a second U.S. port to load additional cargo on the barge, and then proceeds to a foreign port, provided that the tow does not terminate in the second U.S. port. See Treasury Decision 70- 223(19). A change in the towing vessel at the second U.S. port would terminate the tow and would result in a violation of 46 U.S.C. App. 316(a).
b. A foreign-flag tug towing a U.S.-flag barge with a coastwise registry on a voyage to a foreign port may stop in a second U.S. port to pick up fuel, lube, and other necessaries.

Question #3

Pursuant to 46 U.S.C. App. 316(a) and 877, a foreign-flag tug may not tow a U.S.-flag barge with a coastwise endorsement from a U.S. port to Guam. (As stated supra in our response to Question 1.c.1., such a tow may be accomplished by a U.S.-flag vessel with a registry endorsement.)

HOLDINGS:

As detailed supra, certain of the proposed activities are permissible under the coastwise laws and certain of the proposed activities are prohibited under the coastwise laws.

Sincerely,

Arthur P. Schifflin
Chief

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