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HQ H009326




April 11, 2007

VES-3-02:OT:RR:BSTC:CCI H009326 ALS

CATEGORY: CARRIER

Ms. Carol-Beth Sheley
Senior Operations Vessel Manager
Quay Cruise Agencies U.S.A.
680 Switzer Street
10th Avenue Marine Terminal
San Diego, California 92101

Dear Ms. Sheley:

This letter is in response to your request of April 5, 2007, with respect to the coastwise transportation of several individuals. Our ruling is set forth below.

FACTS:

You ask whether numerous individuals may be transported on the non-coastwise qualified M/V MERCURY (the "vessel"), from San Diego, California to San Francisco on two separate occasions. The first part of the voyage will embark 29 individuals at issue from San Diego on April 6, 2007, travel to various ports in Mexico, and then return to San Diego on April 13, 2007. The second part of the voyage will embark 126 additional individuals at issue on April 13 from San Diego and disembark in San Francisco on April 27, 2007.

The individuals will be performing various duties, as you state in your April 5, 2007 letters: repair marble flooring, begin floor sanding, oversee dry dock operation on board, clean air ducts on board, M/V MERCURY shops retrofit, deckcovering works, point of sale deployment, Information Technology (IT) Project Manager, Revitalization Project Management, PBX deployment, watertight door repositioning, ving card upgrade, and IT infrastructure maintenance. You further describe “deckcovering works” as “repairing/resurfacing the decks on board, “PBX” as “the Public Address system onboard for ship personnel to announce ship itinary [sic], etc and in worst case the ABANDON SHIP,” and “ving card” as a “cabin door entry system.” ISSUE:

Whether the subject individuals are "passengers" within the meaning of 46 U.S.C. § 55103 and 19 CFR 4.50(b).

LAW AND ANALYSIS:

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. Such a vessel, after it has obtained a coastwise endorsement from the U.S. Coast Guard, is said to be "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.

The coastwise law applicable to the carriage of passengers is found in 46 U.S.C. § 55103 (recodified by Pub. L. 109-304, enacted on October 6, 2006) and provides that:

In General. Except as otherwise provided in this chapter or chapter 121 of this title, a vessel may not transport passengers between ports or places in the United States to which the coastwise laws apply, either directly or via a foreign port, unless the vessel
is wholly owned by citizens of the United States for purposes of engaging in the coastwise traffic; and
has been issued a certificate of documentation with a coastwise endorsement under chapter 121 or is exempt from documentation but would otherwise be eligible for such a certificate and endorsement.

Penalty. The penalty for violating subsection (a) is $300 for each passenger transported and landed.

Section 4.50(b), Customs and Border Protection (CBP) 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.

We note that the travel from San Diego on April 6, 2007 and back to San Diego April 13, 2007 would not constitute coastwise trade if regarded as a separate voyage from the remainder of the journey because it does not involve transportation between two separate coastwise ports. See 46 U.S.C. § 55103(a). For the purposes of this ruling, we considered the embarkation in San Diego on April 6, 2007 to be the beginning of one continuous voyage that concludes in San Francisco on April 27, 2007. To that extent, the voyage at issue does constitute coastwise trade, as it involves transportation between two separate coastwise ports. See 46 U.S.C. § 55103(a).

You state that the subject individuals will be transported on the vessel for the purpose performing the various tasks as noted in the second paragraph of the FACTS section of this ruling. In this context, and in accordance with previous Headquarters rulings, workmen, technicians, or observers transported by vessel between ports of the United States are not classified as "passengers" within the meaning of 46 U.S.C. § 55103 and 19 CFR § 4.50(b), if they are required to be on board to contribute to the accomplishment of the operation or navigation of the vessel during the voyage or are on board because of a necessary vessel ownership or business interest during the voyage. CBP Ruling HQ 101699 (November 5, 1975); see also CBP Ruling HQ 116721 (September 25, 2006).

Thus, in the present case, to the extent that the individuals would be engaged in any shipboard activities while traveling on the foreign vessel between coastwise ports, that would be "directly and substantially" related to the operation or business of the vessel itself, as would be the case under the facts herein submitted, such individual would not be considered to be a passengers (see HQ 116721, supra; and CBP Ruling HQ 116659 (May 19, 2006), referencing the "direct and substantial" test). See also, e.g., Customs telex 104712, of July 21, 1980, finding that repairmen were not passengers when carried aboard a foreign vessel between U.S. ports "for [the] purpose of repairing vessel en route between such ports."

We find that the proposed activities in this case are directly and substantially connected with the operation and business of the vessel. Therefore, we determine that the subject individuals are not "passengers" within the meaning of 46 U.S.C. § 55103 and 19 CFR 4.50(b). Accordingly, the coastwise transportation of such individuals is not in violation of 46 U.S.C. § 55103.

HOLDING:

The subject individuals are not "passengers" within the meaning of 46 U.S.C. § 55103 and 19 CFR 4.50(b). Therefore, the coastwise transportation of such individuals is not in violation of 46 U.S.C. § 55103.

Sincerely,

Glen E. Vereb

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