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HQ 115630

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March 25, 2002

VES-3-24-RR:IT:EC 115630 GEV

CATEGORY: CARRIER

Steven Hulsebus
Office Chief
Toll Bridge Program
State of California
Department of Transportation
Post Office Box 23660
Oakland, CA 94623-0660

RE: Coastwise Trade; Crane/Barge; 46 U.S.C. App. § 883

Dear Mr. Hulsebus:

This is in response to both of your letters dated February 28, 2002, regarding the use of a crane/barge in bridge construction. The ruling you request and the information you seek is set forth below.

FACTS:

The State of California Department of Transportation proposes to use a crane-mounted barge in the construction of the new eastern span of the San Francisco-Oakland Bay Bridge connecting San Francisco and Oakland in California. The construction of this new bridge will necessitate the lifting of very heavy loads. The crane-mounted barge contemplated for use on this project is the Korean-flagged Samsung Heavy Industries 3000MT Floating Crane. It is a stiff-leg type crane in that the lift boom is hinged at its base and the boom is raised and lowered via pulleys and cables. Lateral movement of the entire floating crane/barge is required to lift and place its load. Specifications and pictures of the 3000MT Floating Crane are attached to your letter requesting a ruling on this matter.

Alternatively, you seek information regarding the use of an integrated foreign-built crane and a U.S.-built barge. Specifically, you wish to know whether the mounting of such a crane on a U.S.-built barge for use in this project would be in compliance with the Jones Act.

ISSUES:

Whether the use of a foreign-flagged crane barge in bridge construction in U.S. waters as described above is a use in the coastwise trade in violation of 46 U.S.C. App. § 883.

Whether the use of a foreign-built crane mounted on a U.S.-built barge in bridge construction in U.S. waters as described above is a use in the coastwise trade in violation of 46 U.S.C. App. § 883.

LAW AND ANALYSIS:

Title 46, United States Code Appendix, § 883 (the merchandise coastwise law often called the "Jones Act") prohibits the transportation of merchandise between United States coastwise points, either directly or via a foreign port, or for any part of the transportation, in any vessel other 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 (i.e., a coastwise-qualified vessel).

Pursuant to section 4.80b, Customs Regulations (19 CFR § 4.80b), a coastwise transportation of merchandise takes place, within the meaning of the 46 U.S.C. App. 883, when merchandise laden at a point embraced within the coastwise laws ("coastwise point") is unladen at another coastwise point, regardless of the origin or ultimate destination of the merchandise.

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.

The Customs Service has long held that the use of a non-coastwise-qualified crane vessel to load and unload cargo or construct or dismantle a marine structure is not coastwise trade and does not
violate the coastwise laws, provided, that any movement of merchandise is effected exclusively by the operation of the crane and not by movement of the vessel, except for necessary movement which is incidental to a lifting operation while it is taking place. Thus, such a crane barge could lift merchandise with its crane at one coastwise point, be pivoted while remaining in one location, and put down the merchandise at a place other than that from which it was lifted. The crane barge would be prohibited from lifting merchandise with its crane at one coastwise point, and while the merchandise is suspended from the crane, placing the merchandise at a second coastwise point (see Customs ruling letters VES-3-CO:R:P:C 106351 PH, dated November 1, 1983; and VES-3/VES-10-01 CO:R:P:C 108213 PH, dated March 6, 1986).

In regard to the vessel under consideration, upon reviewing the pictures you provided in conjunction with your reference to lateral movement of the entire floating crane/barge in lifting and placing its load, it is readily apparent that the activities of the subject crane/barge in this construction project encompass more than the pivoting activity referenced above. Consequently, these services constitute coastwise trade within the meaning of 46 U.S.C. App. § 883 for which the foreign-flagged crane/barge is not qualified.

With respect to the integration of a foreign-built crane on a U.S.-buiIt barge, provided the barge also meets the U.S. ownership requirements for coastwise documentation under 46 U.S.C. § 12106, and the mounting of the crane on the barge does not alter its designation as a U.S.-built vessel, it may engage in the bridge construction under consideration without violating 46 U.S.C. App. § 883. It should be noted, however, that the aforementioned ownership and build requirements are within the purview of the U.S. Coast Guard. We suggest that you contact that agency regarding these requirements at (304) 271-2506 or, in the alternative, submit your concerns in writing to the following address:

U.S. Coast Guard
National Vessel Documentation Center
2039 Stonewall Jackson Drive
Falling Water, West Virginia 25419

HOLDINGS:

The use of a foreign-flagged crane barge in bridge construction in U.S. waters as described above is a use in the coastwise trade in violation of 46 U.S.C. App. § 883.

The use of a foreign-built crane mounted on a U.S.-built barge in bridge construction in U.S. waters as described above is not a use in the coastwise trade in violation of 46 U.S.C. App. § 883 provided the barge meets the applicable citizenship and build requirements administered by the U.S. Coast Guard.

Sincerely,


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