VES-03-17 CO:R:P:C 110153 RAH
Mr. Timothy R. McHugh
Hoch & McHugh
160 State Street
Boston, Massachusetts 02109
RE: Scope of the term "merchandise" in 46 U.S.C. 883
Dear Mr. McHugh:
This is in response to your letter of March 22, 1989, in
which you request a ruling concerning the scope of the term
"merchandise" as used in 46 U.S.C. 883 and 19 C.F.R. 4.80.
FACTS:
According to your letter, it is the understanding of persons
operating barges in the New England area that a barge carrying
construction equipment or materials from one port or place in the
United States to another port or place is not required to be
documented under the laws of the United States when such
equipment or material is owned by the barge owner.
ISSUES:
a) Is equipment, construction equipment and/or building
material owned by the barge owner "merchandise" within
the meaning of 46 U.S.C. 883 and 19 C.F.R. 4.80?
b) If the answer to question a) is "yes," what is the scope
of the term "harbor" for purposes of determining
requirement for documentation as used in 19 C.F.R.
4.80(a)?
LAW AND ANALYSIS
The coastwise laws generally prohibit the transportation of
merchandise between points in the United States embraced within
the coastwise laws, either directly or via a foreign port, or for
any part of such transportation, in any vessel other than a
vessel built in and documented under the laws of the United
States and owned by persons who are citizens of the United
States, or vessels to which the privilege of engaging in the
coastwise trade is extended. 46 U.S.C. App. 883 and 19 C.F.R.
4.80.
The term "merchandise," as used in 46 U.S.C. 883, is not
defined for purposes of that provision. We have used the
definition of "merchandise" found in section 401(c), Tariff Act
of 1930, as amended (19 U.S.C. 1401(c)) in our application of
section 883. "Merchandise" is defined in section 1401(c) as
meaning "goods, wares, and chattels of every description, and
[including] merchandise the importation of which is
prohibited...." More specifically, in Headquarters Decision
105061, dated May 7, 1987, we held that construction equipment
and materials constituted merchandise and could not be
transported in a foreign-built, foreign-flag barge under section
883. Finally, we have held that it is immaterial that cargo
transported may be owned by the vessel owner for purposes of
section 883. Headquarters Decision 109649, 08-1-88.
As to your request that we consider requirements for
establishing title to vessels which are to be documented under
the laws of the United States, please be aware that pursuant to
46 U.S.C. 12110(b), "A barge otherwise qualified to be employed
in the coastwise trade may be employed, without being documented,
in that trade on rivers, harbors, lakes (except the Great
Lakes), canals, and inland waters."
In response to your second inquiry, the term "harbor" is not
specifically defined by statute or regulation for the purposes of
46 U.S.C. App. 883 and 19 C.F.R. 4.80. A harbor in its usual
and ordinary sense means an indentation in the coast of a lake,
sea, or ocean, extending into the country in such manner as to
form an inlet or bay and sufficiently narrow between the
headlands as to afford protection to vessels against the wind
and storm upon the waters. People v. Kirsch, 35 N.W. 157 (1887
Mich.). Accord,: United States v. California, 100 S.Ct. 1994,
447 U.S. 1, 64 L.Ed. 2d. 681, rehearing denied in 101 S.Ct. 600,
449 U.S. 1028, 66 L.Ed. 491, in which "harbor" under the
Convention on the Territorial Sea and the Contiguous Zone was
held to be a body of water providing for safe anchorage and
shelter for vessels; International Maritime Dictionary
(DeKerchore, Second Edition).
Perhaps the most succinct and thorough scope of the term
harbor is "[A] port or haven for ships, a sheltered recess in the
coast line of a sea, gulf, bay, or lake, most frequently at the
mouth of a river." Gordon v. Blackton, 186 A. 690 (1935 N.J.).
HOLDING:
Equipment, construction equipment and/or building materials
owned by the owner of a barge constitute merchandise the
transportation of which is prohibited by 46 U.S.C. App. 883 and
19 C.F.R. 4.80, unless the same is transported in a vessel built
in and documented under the laws of the United States and owned
by persons who are citizens of the United States, or in a vessel
to which the privilege of engaging in the coastwise trade has
been extended. Barges which are not documented but are otherwise
coastwise qualified, may transport merchandise on rivers,
harbors, lakes (except the Great Lakes), canals, and inland
waters. The scope of the term "harbor" is defined above.
Sincerely,
B. James Fritz
Chief
Carrier Rulings Branch