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HQ 114381

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June 11, 1998

VES-3-02-RR:IT:EC 114381 GOB

CATEGORY: CARRIER

Bob Blow
Svitzer Limited
The A.P. Moller Group
Morton Peto Road
Great Yarmouth
Norfolk NR31 Olt
England

RE: 46 U.S.C. App. 289 and 883; 19 CFR 4.50(b); Coastwise transportation

Dear Mr. Blow:

This is in response to your letter of May 29, 1998.

FACTS:

You describe the pertinent facts as follows:

Our company has supplied a tender to an International Cable Installation Company to carry out a geophysical and geotechnical survey for a proposed cable system connecting various US states with Islands off the US coast and in the Caribbean.

We have proposed to our Client that the survey is conducted in the following sequence:

1. Vessel mobilises in Bermuda and surveys southwards to near St. Croix in the US Virgin Islands (no port call in the Virgin Islands).

2. Survey from near St. Croix to Brookhaven (NY), US.

3. Port call in New York to drop survey personnel who will return to the UK, and to embark geotechnical survey personnel and geotechnical equipment. The latter will have already cleared US Customs.

4. Geotechnical survey within US waters, and then transit back to New York for a port call to drop Geotechnical personnel and equipment, all of which will return to UK, and to embark new geophysical survey crew from UK.

5. Geophysical survey from Brookhaven to near Hollywood (Fla.), (no port call in Hollywood).

6. Geophysical survey from near Hollywood (Fla) to near San Juan (Puerto Rico), (no port call in Puerto Rico).

7. Geophysical survey from south side of Puerto Rico to near St. Croix.

8. Transit to UK Virgin Islands for demobilization of survey personnel; vessel departs for UK.

You inquire with respect to the applicability of the coastwise laws to the above activity.

ISSUES:

The applicability of the coastwise laws to the above-stated facts.

LAW AND ANALYSIS:

Statutory and Regulatory Framework

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. A vessel that is built in, documented under the laws of, and owned by citizens of the United States, and which obtains a coastwise endorsement from the U.S. Coast Guard, is referred to as "coastwise-qualified."

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 called the "Jones Act," provides in part that no merchandise shall be transported between points in the United States embraced within the coastwise laws, either directly or via a foreign port, or for any part of the transportation, in any vessel other than a vessel built in, documented under the laws of, and owned by citizens of the United States.

The coastwise law applicable to the carriage of passengers is found in 46 U.S.C. App. 289 (sometimes called the "Passenger Vessel Act" and the "coastwise passenger statute") and provides that:

No foreign vessel shall transport passengers between ports or places in the United States, either directly or by way of a foreign port, under a penalty of $200 for each passenger so transported and landed.

Section 4.50(b), Customs Regulations (19 CFR 4.50(b)) provides as follows:

A passenger within the meaning of this part is any person carried on a vessel who is not connected with the operation of such vessel, her navigation, ownership, or business.

Pursuant to 46 U.S.C. App. 877, the coastwise laws do not apply to the U.S. Virgin Islands.

Analysis

Although your letter does not specifically state, we assume that the transporting vessel is not coastwise-qualified.

While we are not certain precisely what activity a "survey" involves, it does not appear that the proposed activity involves the coastwise transportation of merchandise or passengers.

46 U.S.C. App. 883 does not appear to be applicable to the factual situation which you present because it would appear that you do not propose to transport merchandise aboard the vessel. Further, it does not appear that you propose to lade merchandise at one coastwise point and unlade said merchandise at a second coastwise point. Equipment of the transporting vessel (e.g., in this case, geotechnical equipment) is not considered merchandise for this purpose.

46 U.S.C. App. 289 does not appear to be applicable to the factual situation which you present because it does not appear that you propose to transport passengers. Assuming that "survey personnel" are connected with the operation and/or business of the vessel (see 19 CFR 4.50(b), above), they are not passengers. While we are not precisely certain as to the facts with respect to geophysical and geotechnical surveys and survey personnel, it would appear that survey personnel are connected with the operation and/or business of the vessel such that they are not passengers.

You also ask "whether we would be contravening the Act if we are forced to port call in the US at any point during the above 8 legs in the case of breakdown of the vessel or of any survey equipment."

Assuming that the vessel is not transporting merchandise or passengers (see the above analysis and assumptions), a port call as described in the preceding sentence would not be violative of the coastwise laws.

Report of Arrival, Entry and Clearance

For your information, we will recite the basic report of arrival, entry and clearance requirements.

Pursuant to 19 U.S.C. 1433, the master of a foreign vessel shall report arrival at the nearest Customs facility immediately upon arrival at any port or place within the United States when arriving from a foreign port or place or from a U.S. port.

Pursuant to 19 U.S.C. 1434, the master of a foreign vessel shall make formal entry at the nearest Customs facility within 24 hours after arrival at any port or place in the U.S. from a foreign port or place or from a domestic port.

Pursuant to 46 U.S.C. App. 91, the master of a foreign vessel shall obtain clearance from the Customs Service before proceeding from a port or place in the United States for a foreign port or place or for another port or place in the U.S.

HOLDING:

As detailed above, the facts of your request do not appear to describe the transportation of merchandise or passengers between coastwise points. Accordingly, the coastwise laws do not appear to be applicable to the proposed activity.

Sincerely,

Jerry Laderberg
Chief,

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