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HQ 113293

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January 12, 1995

VES-3-CO:R:IT:C 113293 GEV

CATEGORY: CARRIER

Captain Petros Kontaratos
Casco Bay Line
51-17 Van Loon Street
Elmhurst, New York 11373

RE: Coastwise Trade; Voyage-to-Nowhere; 46 U.S.C. App. ? 289

Dear Captain Kontaratos:

This is in response to your letter dated December 15, 1994, requesting a ruling concerning a foreign-built, foreign-flagged vessel. Our ruling on this matter is set forth below.

FACTS:

Casco Bay Line ("Casco") is interested in purchasing the M/V Le Mistral, a foreign-built, foreign-flagged passenger vessel which was seized by the U.S. Marshall and is currently held by the U.S. District Court's bankruptcy trustee in Corpus Christi, Texas. Casco plans to register the vessel in the United States and operate her in U.S. waters as a sightseeing, dinner dance, charter and casino cruise ship along the East Coast from Maine to Texas and particularly in New York. These cruises would be conducted pursuant to voyages-to-nowhere.

ISSUE:

Whether the transportation of passengers aboard the subject vessel pursuant to a voyage-to-nowhere constitutes a violation of 46 U.S.C. App. ? 289.

LAW AND ANALYSIS:

Title 46, United States Code Appendix, ? 289 (46 U.S.C. App. ? 289, the passenger coastwise law) as interpreted by the Customs Service, prohibits the transportation of passengers between points in the United States embraced within the coastwise laws, either directly or by way of a foreign port, in a non-coastwise-qualified vessel (i.e., any vessel that is not built in and documented under the laws of the United States, and owned by persons who are citizens of the

United States). For purposes of ? 289, "passenger" is defined as "... any person carried on a vessel who is not connected with the operation of such vessel, her navigation, ownership, or business." (19 CFR ? 4.50(b)) Section 4.80a, Customs Regulations (19 CFR ? 4.80a) is interpretive of ? 289.

In its administration of 46 U.S.C. App. ? 289, 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 coastwise point, is considered coastwise trade subject to the coastwise laws. However, the transportation of passengers to the high seas (i.e., beyond U.S. territorial waters) and back to the point of embarkation, assuming the passengers do not go ashore, even temporarily, at another United States point, of ten called a "voyage-to-nowhere", is not considered coastwise trade (29 O.A.G. 318 (1912)). It should be noted that the carriage of fishing parties for hire, even if the vessel proceeds beyond territorial waters and returns to the point of the passengers' embarkation, is considered coastwise trade (T.D. 55193(2)).

In interpreting the coastwise laws, Customs has ruled that a point in United States territorial waters is a point in the United States embraced within the coastwise laws. The territorial waters of the United States consist of the territorial sea, defined as the belt, 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.

In regard to the proposed use of the M/V Le Mistral, the transportation of passengers on sightseeing, dinner dance, charter and casino cruises along the East Coast from Maine to Texas and particularly in New York would not violate 46 U.S.C. App. ? 289 provided the requisite criteria of a voyage-to-nowhere as discussed above are met.

Parenthetically, we note that gambling activities are not within the purview of the Customs Service but rather the Department of Justice. We suggest that you direct any inquiries you may have in that regard to the following address:

Organized Crime and Racketeering Section
Criminal Division
Department of Justice
Washington, D.C. 20530

HOLDING:

The transportation of passengers aboard the subject vessel pursuant to a voyage-to-nowhere does not constitute a violation of 46 U.S.C. App. ? 289.

Sincerely,

Arthur P. Schifflin
Chief
Carrier Rulings Branch


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