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HQ H015735

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August 17, 2007

VES-3-OT:RR:BSTC:CCI H015735 LLB

CATEGORY: CARRIER

Ms. Toni Medina
APM Terminals
2500 Navy Way
Terminal Island, CA 90731

RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b)

Dear Mr. Medina:

This is in response to your correspondence of August 14, 2007, in which you inquire about the coastwise transportation of the two individuals mentioned therein aboard the CORNELIA MAERSK. Our decision follows.

FACTS

The voyage in question involves the transportation of the subject individuals aboard the non-coastwise-qualified CORNELIA MAERSK (the “vessel”) from Los Angeles, California to Tacoma, Washington. The individuals are scheduled to embark in Los Angeles on August 20, 2007, and disembark in Tacoma on August 22, 2007. As part of an on-going research effort under the U.S. Coast Guard’s Research and Development Center, in concert with the Smithsonian Environmental Research Center, the subject individuals will obtain and analyze water samples near shore and commercial shipping lanes. The samples will be used to determine how the concentrations of selected parameters vary with seasons and with distance from the shore. The purpose of the research is “to determine whether ships have conducted proper mid-ocean ballast water exchanges.”

ISSUE

Whether the individuals described in the FACTS section above are “passengers” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 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

Formerly 46 U.S.C. App. § 289. Recodified by Pub. L. 109-304 (Oct. 6, 2006). which provides:

(a) 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- (1) is wholly owned by citizens of the United States for purposes of engaging in coastwise traffic; (2) 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. (b)Penalty. The penalty for violating subsection (a) is $300 for each passenger transported and landed.

The Customs and Border Protection (“CBP”) Regulations, promulgated under the authority of 46 U.S.C. § 55103, provide:

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

19 C.F.R. § 4.50(b).

To this end, most significantly, a legal notice published in the June 5, 2002, Customs Bulletin, in precise concert with the protectionist nature of section 46 U.S.C. § 55103, The June 5, 2002, notice was issued under the former codification of § 55103, 46 U.S.C. App. § 289. See n. 1, supra. imposed a circumscribed construction as to the meaning of the term "passenger" under the U.S. coastwise trade laws, including section 55103. Under this strict interpretation of the term “passenger,” as finalized in the June 5, 2002, Customs Bulletin notice, persons transported on a vessel are considered passengers unless they are "directly and substantially" connected with the operation, navigation, ownership or business of that vessel itself. See e.g., HQ 110967 (Apr.12, 1990)(finding that to the effect that persons on commercial (non-pleasure) vessels are considered passengers unless they enjoy some status which ties them "intimately" to the operation, navigation, ownership or business of the vessel itself).

In the present case, you propose to transport the subject individuals to collect water samples along the shore and commercial shipping lanes for the purpose of an environmental research project. These activities do not connect the individuals directly and substantially with the business, operation, or navigation of the vessel itself. Rather, it appears that the research activity is connected to the operation of all commercial shipping vessels. To the extent that the subject individuals would not be engaging 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, such individuals would be considered passengers within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b).

HOLDING

The individuals described in the FACTS section above are “passengers” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Therefore, the coastwise transportation of such individuals would be in violation of 46 U.S.C. § 55103.

Sincerely,

Glen E. Vereb
Chief

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