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HQ H018647

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October 18, 2007

VES-3-02-OT:RR:BSTC:CCI H018647 JLB

CATEGORY: CARRIER

Mr. Stephen Krupa
Fleet Manager
Maersk Line, Ltd.
One Commercial Place
20th Floor
Norfolk, VA 23510

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

Dear Mr. Krupa:

This letter is in response to your correspondence dated October 17, 2007, in which you request a ruling on whether the coastwise transportation of the individual mentioned therein aboard the M/V HOEGH TROOPER constitutes a violation of 46 U.S.C. § 55103. Our ruling on your request follows.

FACTS

The voyage in question involves the transportation of the subject individual aboard the non-coastwise-qualified M/V HOEGH TROOPER (“the vessel”). The individual will embark on October 19, 2007 at Jacksonville, Florida and will disembark at the port of Baltimore, Maryland on or about October 23, 2007. The individual will travel aboard the vessel in order to prepare for the re-naming, re-flagging and re-crewing activities as the vessel changes from a Bahamas-flagged vessel to a USA registry vessel. The individual will conduct a review of the material condition of the vessel in order to determine the overall maintenance status for a joint survey with the vessel’s current management group and the ship’s crew.

ISSUE

Whether the individual described above would be a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b)?

LAW AND ANALYSIS

The coastwise passenger statute, former 46 U.S.C. App. § 289 recodified as 46 U.S.C. § 55103, pursuant to P.L. 109-304 (October 6, 2006), states that no foreign vessel shall transport passengers “between ports or places in the United States to which the coastwise laws apply, either directly or by way of a foreign port,” under a penalty of $300 for each passenger so transported and landed. See also 19 C.F.R. § 4.80(b)(2). 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.

Under 46 U.S.C. § 55103, a “passenger” is any person carried aboard a vessel “who is not connected with the operation of the vessel, her navigation, ownership, or business.” See also 19 C.F.R. § 4.50(b). In this regard, Customs Bulletin notice, dated June 5, 2002, provides a strict interpretation of “passenger” defining the term as persons transported on a vessel unless they are "directly and substantially" connected with the operation, navigation, ownership or business of that vessel itself. See Headquarters Decision 116659, dated May 19, 2006; see also Headquarters Decision H005913, dated January 26, 2007.

Pursuant to Headquarters Decision 101699, dated November 5, 1975, it is well settled that "workmen, technicians, or observers transported by vessel between ports of the United States are not classified as ‘passengers’ within the meaning of section 4.50(b) and section 289 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." See also Headquarters Decision 116752, dated November 3, 2006, quoting HQ 116721. In the present case, the individual would be traveling aboard the non-coastwise-qualified vessel to perform a review of the material condition of the vessel in order to determine the overall maintenance status. Under the facts presented, the individual would be “directly and substantially” related to the operation and business of the vessel during the voyage and would not be considered a “passenger” under 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Consequently, the coastwise transportation of the subject individual is not in violation of 46 U.S.C. § 55103.

HOLDING

The subject individual is not a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Therefore, the coastwise transportation of such an individual is not in violation of 46 U.S.C. § 55103.

Sincerely,

Glen E. Vereb, Chief

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