VES-3-02-RR:BSTC:CCI H013701 LLB
Captain W.J. Brasier
Director, Operations
Hapag-Lloyd U.S.A. LLC
401 East Jackson Street, Suite 300
Tampa, FL 33602
RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b)
Dear Captain Brasier:
This letter is in response to your correspondence of July 1, 2007, in which you inquire about the coastwise transportation of a senior cargo superintendent aboard the PHILADELPHIA EXPRESS. You also request that this office issue a ruling as to whether “customer service auditors” and sales representatives of your company would be considered passengers within the meaning of the coastwise laws. Our decision follows.
FACTS
The voyage in question involves the transportation of the subject individual, a senior cargo superintendent, aboard the non-coastwise-qualified PHILADELPHIA EXPRESS (the “vessel”) from Houston, Texas to Norfolk, Virginia. The individual is expected to embark in Houston on July 25, 2007 and disembark in Norfolk on August 1, 2007. The subject individual will familiarize himself with the current on-board processes, systems and equipment, to determine the proper stowage of different commodities to ensure ship stability and safety. In the future, Hapag-Lloyd proposes to transport customer service auditors and sales representatives on similar voyages to “familiarize staff with shipboard operations.”
ISSUE
Whether the individuals described in the FACTS section above are “passengers” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 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 which provides:
(a) 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-
(1) is wholly owned by citizens of the United States for purposes of engaging in coastwise traffic;
(2) 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.
(b)Penalty. The penalty for violating subsection (a) is $300 for each passenger transported and landed.
The Customs and Border Protection (“CBP”) Regulations, promulgated under the authority of 46 U.S.C. § 55103, provide:
A passenger within the meaning of this part is any person carried on a vessel who is not connected with the operation of the vessel, her navigation, ownership, or business.
19 C.F.R. § 4.50(b).
You state that the senior cargo superintendent will be transported on the vessel for the purpose of familiarizing himself with the current on-board processes, systems and equipment, to determine the proper stowage of different commodities to ensure ship stability and safety. 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 C.F.R. § 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. HQ 101699(Nov. 5, 1975); see also HQ 116721(Sept. 25, 2006) quoting HQ 101699.
In the present case, to the extent that the senior cargo superintendent would be 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 itself, as would be the case under the facts herein submitted, such individual would not be considered a passenger. Accordingly, the coastwise transportation of the senior cargo superintendent is not in violation of 46 U.S.C. § 55103.
However, with regard to the “customer service auditors” and the sales representatives, we conclude that these individuals are passengers within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). In HQ H008510 (Mar. 22, 2007) and HQ H008513 (Mar. 23, 2007), CBP held that shipping agency trainees transported aboard a vessel “to observ[e] daily life on a vessel and gain[] better insight about what their colleagues [that] work[] on a vessel actually do” or “observe what goes on during a vessel’s voyage” were passengers within the meaning of 46 U.S.C. § 55103 insofar as the trainees were not “directly and substantially” connected with the operation, navigation, ownership or business of the vessel itself. See also, HQ H010696 (May 9, 2007) and HQ H010662 (May 9, 2007)(holding that shipping agencies human resources manager and ship broker’s trainee, respectively, transported coastwise “to observe shipboard operations” were passengers within the meaning of 46 U.S.C. § 55103); HQ H013452 (June 29, 2007)(holding that transporting a stevedore for training purposes was not “directly and substantially” related to the operation or business of the vessel itself).
Similarly, in the present case, you propose to transport customer service auditors and sales representatives aboard certain vessels for to “familiarize staff with shipboard operations.” Although familiarizing customer service auditors and sales representatives with vessel operations may foster the business of the shipping company, it does not connect those individuals directly and substantially with the business of the vessel itself. 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 C.F.R. § 4.50(b).
HOLDING
The senior cargo superintendent, as described above, is not a “passenger” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Therefore, the coastwise transportation of that individual is not in violation of 46 U.S.C. § 55103.
The customer service auditors and the sales representatives are “passengers” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Therefore, the coastwise transportation of those individuals would be in violation of 46 U.S.C. § 55103.
Sincerely,
Glen E. Vereb
Chief
Cargo Security, Carriers and Immigration Branch