HQ 0112135 - Vessel entry and clearance; Voyage to nowhere; United States-flag vessel; Outside of port limits; 19 U.S.C. 1434; 19 U.S.C. 1447; 46 U.S.C. App. 91 - United States International Trade Commision Rulings

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HQ 112135

May 7, 1992

VES-5-CO:R:IT:C 112135 LLB

CATEGORY: CARRIER

Mr. Glenn G. Kolk
520 Brickell Key Drive
Suite 1606
Miami, Florida 33131

RE: Vessel entry and clearance; Voyage to nowhere; United States-flag vessel; Outside of port limits; 19 U.S.C. 1434; 19 U.S.C. 1447; 46 U.S.C. App. 91

Dear Mr. Kolk:

Reference is made to your facsimile transmission of April 18, 1992, which specifically narrows the scope of your letter of March 13, 1992. Your inquiry concerns vessel entry and clearance requirements which may be applicable to American-flag vessels proceeding on voyages to nowhere.

FACTS:

It is proposed that a United States-flag vessel (which for the purposes of this ruling we assume to be non-coastwise- qualified), be used to transport passengers on voyages from a point in the United States to the high seas and back again to the same domestic point. In a letter dated March 13, 1992, it was anticipated that the passengers would be permitted to engage in casino gambling activities while in international waters due to recent amendments to the Johnson Act (15 U.S.C. 1172), the statute which restricts the carriage of gaming aboard American vessels. Since it is necessary that the Department of Justice interpret the scope and applicability of that amended statute, the area of inquiry to the Customs Service was narrowed in a letter dated April 18, 1992.

We are most recently asked to exclude from our consideration any shipboard gambling issues. It is specifically stated that the sole issue for which guidance is being sought is whether formal vessel clearance is required for United States-flag vessels engaging in voyages to nowhere. The question is posed in light of the vessel operators intention to operate from a location outside the geographical limits of a Customs port of entry.

ISSUE:

Whether United States-flag vessels engaging in passenger carriage on voyages to nowhere are required to obtain vessel clearance upon their departure, or to formally enter upon their return. Further, if such formalities are not required, may such vessels conduct business from areas outside of Customs port limits.

LAW AND ANALYSIS:

The Act of June 19, 1886, as amended (24 Stat. 81; 46 U.S.C. App. 289, sometimes called the coastwise passenger law), provides that:

No foreign vessel shall transport passengers between ports or places in the United States either directly or by way of a foreign port, under a penalty of $200 for each passenger so transported and landed.

For your general information, we have consistently interpreted this prohibition to apply to all vessels except United States-built, owned, and properly documented vessels (see 46 U.S.C. 12106, 12110, 46 U.S.C. App. 883, and 19 C.F.R. 4.80).

In interpreting the coastwise laws as applied to the transportation of passengers, the Customs Service 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 point, is considered coastwise trade subject to the coastwise laws. However, the transportation of passengers to the high seas or foreign waters and back to the point of embarkation, assuming the passengers do not go ashore, even temporarily, at another United States point, often called a "voyage to nowhere," is not considered coastwise trade. The territorial waters of the United States consist of the territorial sea, defined as the belt, three nautical miles wide, adjacent to the coast of the United States and seaward of the territorial sea baseline.

The first of these positions, regarding transportation of passengers entirely within territorial waters on a voyage in which they embark and disembark at the same coastwise point is based on a 1900 decision (Treasury Decision 22275). Our rulings have consistently followed this position.

The second of these positions, regarding transportation of passengers from a point in the United States to the high seas or foreign waters and back to the same point, is based on a 1912 opinion of the Attorney General of the United States (29 Opinions of the Attorney General 318). We have consistently followed this position as well.

Section 433, Tariff Act of 1930, as amended (19 U.S.C. 1433), provides the immediate report of arrival requirements for vessels arriving in the United States. For American-flag vessels the requirement is effective for vessels either arriving from a foreign port or place, or vessels carrying either bonded or unentered foreign merchandise. For purposes of the report of arrival statute, the definition of a foreign port or place includes a hovering vessel or any vessel from which merchandise is received, when such vessel is beyond the three mile territorial sea boundary.

Section 434, Tariff Act of 1930, as amended (19 U.S.C. 1434), provides that except for circumstances not here relevant formal vessel entry is required of United States-flag vessels arriving from foreign ports or places. As in the case of section 1433, a foreign port or place for purposes of this statute includes hovering vessels or vessels from which merchandise is received, but does not include the high seas.

For those vessels which are required to enter, section 447, Tariff Act of 1930, as amended (19 U.S.C. 1447), provides that entry shall be made at a port of entry (except for circumstances in which good cause is shown). In excepted cases, authority is provided for entry to be permitted outside a port of entry.

Pursuant to section 91 of title 46, United States Code Appendix (46 U.S.C. App. 91), vessels departing in trade and proceeding to a foreign port are required to obtain clearance from Customs. This provision is administered under section 4.60, Customs Regulations (19 CFR 4.60), subsection (e) of which (19 CFR 4.60(e)), provides:

No vessel shall be cleared for the high seas except, a vessel bound to another vessel on the high seas...

In practical terms this means that clearance is not required for departure to the high seas only.

In the present case, an American-flag vessel need not clear, enter, or report its arrival if engaging in true voyage to nowhere cruises. By this it is meant that passengers must embark and disembark at the same point in the United States, and the vessel must proceed beyond the three mile limit of the territorial seas and not stop at any other coastwise point including a point in territorial waters. Since the requirement to enter is not operative, such cruises may begin and end at a point outside the limits of a Customs port of entry.

HOLDING:

A non-coastwise-qualified United States-flag vessel may conduct voyages to nowhere (as defined in the Law and Analysis portion of this ruling), without the necessity to obtain clearance, to report arrival, or to formally enter. Such activities may be conducted outside the limits of a Customs port of entry.

The scope of this ruling is limited issues concern the clearance, entry, and report of arrival requirements affecting non-coastwise-qualified United States-flag vessels conducting genuine voyages to nowhere. The ruling does not address shipboard gambling issues, nor does it constitute any approval to engage in such activities.

Sincerely,

B. James Fritz

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