HQ 113906 - Towing; Foreign-flag Tugs; Assistance in Cable-Laying Operations; - United States International Trade Commision Rulings

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HQ 113906

April 24, 1997

VES-3-01/10-03-RR:IT:EC 113906 GEV

CATEGORY: CARRIER

Jeanne M. Grasso, Esq.
Dyer, Ellis & Joseph
Watergate, Suite 1000
600 New Hampshire Ave., N.W.
Washington, D.C. 20037

RE: Towing; Foreign-flag Tugs; Assistance in Cable-Laying Operations;
46 U.S.C. App. ? 316(a)

Dear Ms. Grasso:

This is in response to your letter of April 14, 1997, on behalf of your client, Cable & Wireless Marine ("CWM"), requesting a ruling that foreign-flag tugs can be used to assist in cable-laying operations in U.S. territorial waters and beyond. Per your request this matter was discussed in a meeting with us on April 17, 1997. Our ruling is set forth below.

FACTS:

CWM will perform submarine cable installation work on the Gemini Cable System. The Gemini System consists of two Atlantic crossings - Gemini South and Gemini North, scheduled to be installed during the summer of 1997 and winter of 1997/1998, respectively. The southern link is from Manasquan, New Jersey to Portheurno, UK and the northern link is from Greenhill, Rhode Island to Oxwich Bay, UK.

CWM plans to employ two high-performance foreign-flag tugs to assist its self-propelled cable ship, CABLE VENTURE, while it is engaged in cable installation. The tugs will provide the cable ship with additional stability and position holding during cable-ploughing operations. The tugs and CABLE VENTURE will rendezvous in New York, where CABLE VENTURE will take on bunkers and stores, and then steam together to Manasquan or Greenhill to conduct "sea trials," preferably within the territorial sea. The trials, which are scheduled to last approximately 24 hours, are to ensure that the cable-ploughing operation utilizing the two tugs to provide stability and position holding will be done safely and effectively. These trials are part of the normal procedures at the start of a multiple vessel operation.

After completion of the sea trials, the CABLE VENTURE will anchor at a 3-point mooring near the end of the pre-layed cable which may be either inside or outside the territorial sea. The crew aboard the CABLE VENTURE will splice the pre-layed cable to the cable aboard ship. The cable-laying operation will then commence either inside the territorial sea or outside the territorial sea, depending on the location of the end of the pre-layed cable, and continue across the ocean for approximately 101 nautical miles toward the United Kingdom. At this stage, the tugs will be released and the CABLE VENTURE will continue to lay cable unassisted in deep water. The following are the scenarios on which CWM desires a ruling.

Scenario 1 - "Sea Trials" - The CABLE VENTURE and the two foreign-flag tugs will convene in New York, then steam toward Manasquan or Greenhill for "sea trials." During the trials, the tugs will engage and disengage to the bow and stern of the CABLE VENTURE, or maneuver otherwise, to provide necessary stability and position holding for a cable-ploughing operation. The purpose is to ensure that the two tugs and the CABLE VENTURE can work together safely and effec- tively prior to commencing cable-ploughing operations. The sea trials may be con- ducted either in the territorial sea or outside the territorial sea.

Scenario 2 - Cable-laying - One foreign-flag tug will engage to the bow of the
CABLE VENTURE in the territorial sea and will remain engaged throughout the cable-ploughing operation. The other foreign-flag tug will follow closely astern, both within the territorial sea and outside the territorial sea, and provide stability and position holding assistance either by pushing or pulling CABLE VENTURE into position as necessary. The two tugs may switch positions, i.e., the bow tug will become the stern tug and vice versa, during the operations in the territorial sea or outside the territorial sea.

Scenario 3 - Cable-laying - One foreign-flag tug will engage to the bow of the
CABLE VENTURE outside the territorial sea (and will not enter the territorial sea) and will remain engaged throughout the cable-ploughing operation. The other foreign-flag tug will follow closely astern and provide stability and position holding assistance either by pushing or pulling CABLE VENTURE into position as necessary. The tugs may switch position, i.e., the bow tug will become the stern tug and vice versa, during the operations outside the territorial sea.

Scenario 4 - Cable-laying - Both foreign-flag tugs will engage to the CABLE
VENTURE, one on the bow and one on the stern, in the territorial sea and will remain engaged throughout the cable-laying operation in the territorial sea. Once outside the territorial sea, the stern tug may disengage and provide stability and positioning support by pushing or pulling the CABLE VENTURE into position as necessary. The tugs may switch positions, i.e., the bow tug will become the stern tug and vice versa, during the operations in the territorial sea and outside the territorial sea.

Scenario 5 - Cable-laying - Both foreign-flag tugs will engage to the CABLE
VENTURE, one to the bow and one to the stern, outside the territorial sea and may or may not remain engaged throughout the cable-laying operation. The tugs may switch position, i.e., the bow tug will become the stern tug and vice versa, during the operations outside the territorial sea.

ISSUE:

Whether the use of foreign-flag tugs in providing assistance in cable-laying operations as described in the above scenarios is violative of 46 U.S.C. App. ? 316(a).

LAW AND ANALYSIS:

Title 46, United States Code Appendix, ? 316(a) (46 U.S.C. App. ? 316(a), the coastwise towing statute) prohibits the use of any vessel not having in force a certificate of documentation endorsed for the coastwise or Great Lakes trades (46 U.S.C. 12106, 12107, respectively) to tow any vessel other than a vessel in distress, from any point or place embraced within the coastwise laws of the United States to another such port or place, either directly or by way of a foreign port or place, or for any part of such towing.

Points embraced within the coastwise laws include all points within the territorial waters of the United States, including points within a harbor. 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 to points located in internal waters, landward of the territorial sea baseline, in cases where the baseline and coastline differ.

With respect to the proposed activities of the subject foreign-flag tugs, CWM first contends that 46 U.S.C. App. ? 316(a) is inapplicable inasmuch as the tugs are not "towing" but "...are merely providing stability and positioning support while the self-propelled CABLE VENTURE is operating under its own power." In support of this contention, CWM cites Customs ruling letter 103692, dated December 28, 1978, wherein it is stated that "[t]he Customs Service has defined towing as hauling another vessel through the water by means of a line." (emphasis added)

In regard to the above-cited statement, we submit that a review of additional Customs rulings interpreting 46 U.S.C. App. dispositive of Customs position with respect to the entirety of activities coming within the purview of that statute. To that end it should be noted that Customs has long-held that "...assisting a vessel under its own power in docking or undocking is indeed towing'." (Customs ruling letter 102240, dated November 4, 1976, discussing Sun Oil Co. v. Dalzell Towing Co., Inc., 287 U.S. 291, 53 S.Ct. 135) Further in regard to Customs position that assisting vessels in berthing operations is "towing" within the meaning of 46 U.S.C. App. ? 316(a), see the following: Customs ruling letters 103910, dated August 15, 1979; 104220, dated October 17, 1979; and

108922, dated May 15, 1987) In addition to "towing", "pushing" is also a vessel assistance activity falling within the purview of the coastwise towing statute. (Customs ruling letters 105029, dated March 5, 1981; and 106912, dated August 8, 1984)

As discussed in the five scenarios set forth in the ruling request and as evidenced by a diagram submitted by CWM in its meeting with Customs officials from this office, the assistance to be provided by the subject tugs includes pushing as well as pulling by use of a tow line, albeit while the CABLE VENTURE is operating under its own power. Based on the above rulings, it is therefore readily apparent that this assistance is within the purview of 46 U.S.C. App. ? 316(a) and is therefore subject to the prohibitions set forth therein when conducted between points within the territorial sea. With respect to the applicability of those statutory provisions to the scenarios in question, we have determined as follows.

Scenario 1 - "Sea Trials" - The "sea trials" described in Scenario 1 are not violative of the subject statute provided they are conducted outside the territorial sea. In regard to the assertion of CWM that these sea trials are not "domestic commerce" and are therefore not subject to the prohibitions of the towing statute, we emphasize that Customs interprets the coastwise towing statute "...strictly in order to reserve any tows between coastwise points for qualified vessels of the United States, except for those involving bona fide distress situations." (Customs ruling letter 111870, supra, citing Customs ruling letter 109631, dated July 19, 1988) It is therefore our position that any such sea trials conducted by the subject tugs within the territorial sea constitute "towing" within the meaning of 46 U.S.C. App. ? 316(a) and run contra to that statute.

Scenario 2 - Cable-laying - The services of both tugs will commence inside the territorial sea and terminate outside the territorial sea. Under those circumstances there is no towing between coastwise points therefore no violation of the statute will ensue. In the event these two tugs switch positions (i.e., the bow tug becomes the stern tug and vice versa), the subject statute is still not violated provided such switching occurs outside the territorial sea.

Scenario 3 - Cable-laying - The services of both tugs will commence and terminate outside the territorial sea as will any switching of their positions. Consequently, since there is no towing between coastwise points, no violation of the statute will ensue.

Scenario 4 - Cable-laying - The services of both tugs will commence inside the territorial sea and terminate outside the territorial sea. Under those circumstances there is no towing between coastwise points therefore no violation of the statute will ensue. In the event the two tugs switch positions (i.e., the bow tug becomes the stern tug and vice versa), the subject statute is still not violated provided such switching occurs outside the U.S. territorial sea.

Scenario 5 - Cable-laying - The services of both tugs will commence and terminate outside the territorial sea as will any switching of their positions. Consequently, since there is no towing between coastwise points, no violation of the statute will ensue.

HOLDING:

As discussed in the Law and Analysis portion of this ruling, the use of foreign-flag tugs in providing assistance in cable-laying operations as described in the above scenarios is violative of 46 U.S.C. App. ? 316(a) when such assistance encompasses "towing" between points embraced within the coastwise laws.

Sincerely,

Jerry Laderberg

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