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 > 2008 HQ Rulings > HQ H022588 - HQ H023423 > HQ H022782

Previous Ruling Next Ruling
HQ H022782

---

February 25, 2008

VES-3-02-OT:RR:BSTC:CCI H022782 JLB

CATEGORY: CARRIER

Mr. D.M. Dorsch
Charles Dorsch Ship’s Agent, Inc.
1981 Main Street
San Diego, California 92113

RE: Coastwise Transportation; 46 U.S.C. § 55103

Dear Mr. Dorsch:

This letter is in response to your correspondence dated January 29, 2008, in which you request a ruling on whether sport fishing vessels may transport passengers to a diving site outside the U.S. territorial waters and return without violating 46 U.S.C. § 55103. Our ruling on your request follows.

FACTS

The proposed attraction is a diving site consisting of a floating cage containing live fish. The cage will be anchored near the north island of the Coronado Islands of Mexico, which lie approximately twelve miles south of the United States-Mexico border and approximately seven to eight miles west of Mexico’s mainland. Passengers of U.S.-registered sport fishing vessels would visit this diving site to swim with live fish. These vessels are sport fishing vessels that embark passengers in San Diego, California, travel to the waters of the Coronado Islands for a half day or full day fishing trip and then return to San Diego to disembark the passengers. Under this proposal, during these fishing trips the vessels would travel to the diving site, tie up alongside the cage, where the passengers would be able to swim with the fish for hour intervals, reboard the vessels, and return to their point of embarkation in San Diego.

ISSUE

Whether the proposed operation described above constitutes an engagement in coastwise trade for purposes of 46 U.S.C. § 55103?

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 a vessel shall not 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,” unless the vessel was built in and documented under the laws of the United States and owned by persons who are citizens of the United States. See also 19 C.F.R. § 4.80(b)(2). 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.

In its administration of 46 U.S.C. § 55103, U.S. Customs and Border Protection (“CBP”) has ruled that the carriage of passengers entirely within territorial waters, even though the passengers disembark at their point of embarkation and the vessel touches no other coastwise point, is considered coastwise trade. However, the transportation of passengers to the high seas and back to the point of embarkation, assuming the passengers do not go ashore, even temporarily, at another coastwise point, often called a "voyage to nowhere," is not considered coastwise trade. See 29 Op. Atty Gen. 318 (1912); Headquarters Ruling Letter 113846, dated May 5, 1997; Headquarters Ruling Letter 113293, dated January 12, 1995; Headquarters Ruling Letter 112171, dated May 20, 1992.

In Headquarters Ruling Letter 112716, dated June 2, 1993, CBP held that so long as passengers disembark at their point of embarkation, there is no engagement in coastwise trade when passengers temporarily get off a vessel used only to transport the passengers to swim or dive at points outside of the U.S. territorial waters. However, it should be noted that the carriage of fishing parties for hire, even if the vessel proceeds beyond territorial waters and returns to the point of the passenger's embarkation, is considered coastwise trade. See Headquarters Ruling Letter 112472, dated October 26, 1992. CBP has previously ruled that a commercial sport fishing vessel which proceeds beyond U.S. territorial waters and fishes solely in waters south of the United States-Mexican border would be considered engaging in coastwise trade within 46 U.S.C. § 55103. See Headquarters Ruling Letter 109517, dated August 17, 1988. Consequently, the commercial sport fishing vessels used in your proposal would be considered to be engaged in coastwise trade regardless of whether the passengers visit the diving site to swim with live fish as described.

HOLDING

The proposed operation described above constitutes an engagement in the coastwise trade for purposes of 46 U.S.C. § 55103. Consequently, the vessels to be used in the proposed operation must have a certificate of documentation issued by the U.S. Coast Guard and endorsed for the coastwise trade pursuant to 46 U.S.C. § 12112, or if exempt from documentation due to their tonnage, must otherwise be coastwise-qualified pursuant to section 4.80(a)(2), CBP Regulations (19 C.F.R. § 4.80(a)(2)).

Sincerely,

Glen E. Vereb, Chief

Previous Ruling Next Ruling