United States International Trade Commision Rulings And Harmonized Tariff Schedule

faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers

faqs.org > Rulings and Tariffs Home > Rulings By Number > 1998 HQ Rulings > HQ 114268 - HQ 114493 > HQ 114461

Previous Ruling Next Ruling
HQ 114461

---

September 11, 1998

VES-3-12-RR:IT:EC 114461 GOB

CATEGORY: CARRIER

Derrick Briggs
Manager, Environmental Protection & Regulation Northern Transportation Company Limited
42003 Mackenzie Highway
Hay River, NWT
X0E 0R9

RE: Coastwise transportation of passengers and merchandise; Oil spill response;
46 U.S.C. App. 289, 883

Dear Mr. Briggs:

This is in response to your letter of August 27, 1998.

FACTS:

You describe the pertinent facts as follows:

Northern Transportation Company Limited presently provides marine related services in the Canadian Arctic region as well as the North Slope region of Alaska. Our fleet consists of numerous tugs and barges, all of which are of Canadian registry.

There is a prospective business opportunity to provide marine related oil spill response services in the North Slope Region of Alaska. Suitable ice class and non ice class marine equipment (response tugs and barges) will be required to provide effective response capabilities to support oil production from offshore, manmade islands in the North Slope area.

The operational scope that would relate to a response to oil spill occurrence would require that marine equipment allocated to the oil spill contingency program be capable to move oil spill related equipment, recovered oils etc., from point to point within US territorial waters without regulatory restriction.

Oil spill response exercises would also be undertaken frequently that would require the movement of oil spill related equipment which would not [be] part of the responding vessels equipment, as well as oil spill response manpower resources which would be supernumerary to the response vessels crew. Most of this movement would be from point to point within US territorial waters as well.

ISSUE:

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

LAW AND ANALYSIS:

Statutory and Regulatory Framework of the Coastwise Laws

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. Equipment and supplies of the transporting vessel are not considered "merchandise" for this purpose. Equipment and supplies which are not equipment and supplies of the transporting vessel are "merchandise" for this purpose.

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)) states 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.

Applicability of the Coastwise Laws to Facts

The activity which you propose involves the coastwise transportation of merchandise (i.e., oil spill related equipment which is not equipment of the transporting vessel) and the coastwise transportation of passengers (i.e., individuals other than the crew of the transporting vessel).

Pursuant to 46 U.S.C. App. 289 and 883, such transportation may only be accomplished by coastwise-qualified vessels. Your Canadian-registry vessels are not coastwise-qualified.

Accordingly, your non-coastwise-qualified vessels may not engage in the proposed transportation.

We call to your attention 46 U.S.C. 12106(d)(1), which provides:

(d)(1) A vessel may be issued a certificate of documentation with a coastwise endorsement if-

(A) the vessel is owned by a not-for-profit oil spill response cooperative or by members of such a cooperative who dedicate the vessel to use by the cooperative;

(B) the vessel is at least 50 percent owned by persons or entities described in section 12102(a) of this title;

(C) the vessel otherwise qualifies under section 12106 to be employed in the coastwise trade; and

(D) use of the vessel is restricted to-

(i) the deployment of equipment, supplies, and personnel to recover, contain, or transport oil discharged into the navigable waters of the United States, or within the Exclusive Economic Zone, or

(ii) for training exercises to prepare to respond to such a discharge.

In the event that you wish to pursue U.S. documentation under 46 U.S.C. 12106(d)(1), you should contact:

The U.S. Coast Guard
National Vessel Documentation Center
2039 Stonewall Jackson Drive
Falling Water, West Virginia 25419
1-800-799-8362.

HOLDING:

The proposed activity constitutes the transportation of passengers and merchandise within the meaning of 46 U.S.C. App. 289 and 883. Such transportation may not be accomplished by non-coastwise-qualified vessels.

Sincerely,

Jerry Laderberg
Chief,
Entry Procedures and Carriers
Branch

Previous Ruling Next Ruling