HQ H027133 - Coastwise Transportation; 46 U.S.C. § 55103; 19 CFR 4.50(b) - United States International Trade Commision Rulings

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HQ H027133

May 5, 2008

VES-3-02:OT:RR:BSTC:CCI H027133 ALS

CATEGORY: CARRIER

Mr. Luke Gheorghe
Norton Lilly International
249 East Ocean Boulevard, Suite 200
Long Beach, California 90802

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

Dear Mr. Gheorghe:

This letter is in response to your request, which we received on April 30, 2008, with respect to the coastwise transportation of three individuals. Our ruling is set forth below.

FACTS:

You ask whether three individuals may be transported on the non-coastwise qualified M/V NIPPON MARU ("vessel"), from Los Angeles, California to Seattle, Washington. The individuals will embark on June 27, 2008 in Los Angeles and disembark in Seattle on June 30, 2008. You state that the individuals will be onboard to “carry out presentations as well as [lecture] passengers regarding make up and cosmetics.”

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.

You state that the individuals will be onboard to “carry out presentations as well as [lecture] passengers regarding make up and cosmetics.” 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).

With regard to the three individuals who will be providing a lecture about “make up and cosmetics,” as described above, we have determined that those individuals are considered passengers. In CBP Ruling HQ H011874 (May 31, 2007), CBP held that individuals transported aboard a vessel to “embark as clothing consultants and they will just give advice about fashion for the passengers onboard” were passengers within the meaning of 46 U.S.C. § 55103 insofar as these "fashion consultants" were not “directly and substantially” connected with the operation, navigation, ownership or business of the vessel itself. In CBP Ruling HQ 23376 (March 10, 2008), we ruled that individuals providing lectures to passengers are passengers themselves.

Similarly, in the present case, you proposed to transport three individuals who will provide a lecture about “make up and cosmetics,” To the extent that the subject individuals would not have been 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, such individuals would be considered passengers within the meaning of 46 U.S.C. § 55103 and 19 CFR 4.50(b).

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

HOLDING:

The subject individuals are "passengers" within the meaning of 46 U.S.C. § 55103 and 19 CFR 4.50(b). Therefore, the coastwise transportation of such individual would be in violation of 46 U.S.C. § 55103.

Sincerely,

Glen E. Vereb

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