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HQ H003370

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November 16, 2006

VES-3-02-RR:BSTC:CCI H003370

CATEGORY: CARRIER

Mr. David Barber
Carolina Shipping Company
1064 Gardner Road
Fairfield Office Park
Suite 312
Charleston, South Carolina 29415

RE: Coastwise Transportation: 46 U.S.C. App. § 289; 19 CFR § 4.50(b)

Dear Mr. Barber:

This is in response to your letter of November 16, 2006, with respect to the coastwise transportation of a certain individual aboard a foreign-flagged vessel. Our response on this matter is set forth below.

FACTS:

You inquire whether a field engineer affiliated with Sperry Marine may board the CSAV CHICAGO, a foreign-flagged vessel, at Charleston, South Carolina, and disembark at Port Everglades, Florida, in order to install during transit an MF/HF radio system that complies with Global Maritime Distress and Safety System (GMDSS) requirements.

ISSUE:

Whether the use of a foreign-flagged vessel in transporting a field engineer from one U.S. port to another U.S. port, for the purpose of installing during transit a radio system required for safety purposes, would constitute a violation of 46 U.S.C. App. § 289?

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. App. § 289 and 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 $300 for each passenger so transported and landed.

Section 4.50(b), U.S. 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.

In your letter, you cite General Letter No. 117, dated May 20, 1916, which originally set forth the meaning of the term “passenger” appearing in 19 CFR § 4.50(b). However, this General Letter specifically found that only the officers of the company owning a vessel, and, if a corporate owner, the members of its board of directors, would, by virtue of their positions as such, be connected with the ownership or business of that vessel so as not to be passengers while being carried aboard. Because there is no assertion that the field engineer is an officer or director of the vessel owner, General Letter No. 117 is not helpful to your position.

You state that the individual will be installing a radio system, required for safety purposes, during transit of the vessel from one U.S. port to another U.S. port. In this context, and “[i]n 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 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.” HQ 101699 (November 5, 1975); see also HQ 116721 (September 25, 2006), quoting HQ 101699.

Thus, in the present case, to the extent that the field engineer would be engaged in any shipboard activities while traveling on the foreign-flagged vessel between coastwise ports, that would be “directly and substantially” related to the operation or business of the vessel itself, as would be the case under the facts herein submitted, such individual would not be considered to be a passenger (see HQ 116721, supra, HQ 116659 (May 19, 2006), referencing the “direct and substantial” test). See also, e.g., Customs telex 104712 (July 21, 1980), finding that repairmen were not passengers when carried aboard a foreign vessel between U.S. ports “for [the] purpose of repairing vessel en route between such ports.”

Based upon the fact that the individual will be installing a radio system required for safety purposes during the subject vessel’s voyage, we find that this individual is not a “passenger” within the meaning of 46 U.S.C. App. § 289 and 19 CFR 4.50(b). Therefore, the coastwise transportation of such individual would not be in violation of 46 U.S.C. App. § 289.

HOLDING:

The use of a foreign-flagged vessel in transporting a field engineer from one U.S. port to another U.S. port, for the purpose of installing during transit a radio system required for safety purposes, would not violate 46 U.S.C. App. § 289.

Sincerely,

Glen E. Vereb
Chief

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