VES-3-02-OT:RR:BSTC:CCI H023116 LLB
Ms. Carol-Beth Sheley
Quay Cruise Agencies
662 Switzer Street
10th Avenue Marine Terminal
San Diego, California 92101
RE: Coastwise Transportation; 46 U.S.C. § 55103; 19 C.F.R. § 4.50(b)
Dear Ms. Sheley:
This letter is in response to your correspondence of February 8, 2008, in which you inquire about the coastwise transportation of the two individuals mentioned therein aboard the M/V REGENT SEVEN SEAS MARINER on behalf of your client, Regent Seven Seas Cruises (Regent). Our decision follows.
FACTS
The voyage in question involves the transportation of the subject individuals, a Regent sales account executive and her spouse, aboard the non-coastwise-qualified M/V REGENT SEVEN SEAS MARINER (the “vessel”) from San Diego, California to Seattle, Washington. The individuals are expected to embark in San Diego on May 14, 2008 and disembark in Seattle on May 19, 2008. The purpose stated for the transportation of the sales account executive is to "conduct[] sales training seminars to their top producing travel agencies" and her spouse will "assist her with her event."
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. See 33 C.F.R. § 2.22(a)(2)(2007). 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).
In HQ 116659 (May 19, 2006), a cruise line proposed transporting employees and contractors that worked in the areas of North America Sales and Marketing and International Sales and Marketing for the purpose of strategizing on how to sell, market, and enhance the overall guest experience of the vessel. CBP held that the foregoing individuals were “passengers” within the meaning of 19 C.F.R. § 4.50(b) and the coastwise transportation of those passengers would be in violation of 19 U.S.C. § 55103. See also, HQ H013701 (July 10, 2007) (holding that sales representatives are passengers); HQ H002925 (Nov. 8, 2006) (holding that key account representative is a passenger).
In addition, we have historically held that individuals, cruise line employees or contractors, transported solely for the promotional purpose of the cruise line, are passengers within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). See Bureau Letter dated July 3, 1957, MA 212 (movie making); HQ 109695 (Nov. 3, 1988) (camera crew carried aboard to film a promotional video); HQ 116668 (July 25, 2006) (camera crew and company employees engaged in promotional filming for cruise line); HQ H008038 (Mar. 9, 2007) (holding that two marketing employees of the cruise line and independent contractors, that were shooting, producing, and performing in a promotional video cruise line were passengers); and HQ H020448 (Dec. 13, 2008) (holding that sales and marketing cruise line employees and contractors conducting an "industrial show" for travel agencies were passengers). CBP’s reasoning in the holdings in the foregoing cases is that none of those activities are “directly and substantially” related to the operation or business of the vessel itself.
Here, the purpose of transporting the sales account executive is to conduct sales training seminars to Regent's top producing travel agencies. Although training travel agents may foster the business of Regent, it does not connect this individual directly and substantially with the business of the vessel itself. To the extent that the subject individual 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 individual would be considered a passenger within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b).
With regard to the sales executive's spouse, it is well-settled that immediate family members (i.e., a spouse and children) of the officers of the vessel transported by the 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). See, e.g., HQ H004335 (December 13, 2006) citing U.S. Customs Service General Letter No. 117 (May 20, 1916); see also Cust. Bull. Vol. 36, no. 8, p. 50 (February 20, 2002). Notwithstanding the fact that a sales executive is considered a passenger, a sales executive would not be considered an officer of the vessel, thus, the spouse of a sales executive would be considered a passenger within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b).
Accordingly, based on the foregoing, both the sales executive and her spouse are considered passengers within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Therefore, the coastwise transportation of these individuals would be in violation of 46 U.S.C. § 55103.
HOLDING
The sales representative and her spouse are “passengers” within the meaning of 46 U.S.C. § 55103 and 19 C.F.R. § 4.50(b). Therefore, the coastwise transportation of these individuals would be in violation of 46 U.S.C. § 55103.
Sincerely,
Glen E. Vereb
Chief
Cargo Security, Carriers and Immigration Branch