VES-3-OT:RR:BSTC:CCR H242538 LLB
Mr. Ralph Rinello, Director
Legal Department-Immigration Compliance
Walt Disney Parks & Resorts U.S., Inc.
12450 State Road 535
Lake Buena Vista, Florida 32830
RE: Coastwise Transportation; 46 U.S.C. §§ 55103 and 55104; 19 C.F.R. § 4.50(b)
Dear Mr. Rinello:
This letter is in response to your correspondence of May 23, 2013, in which you inquire about the two cruise itineraries involving the transportation of passengers aboard the DISNEY MAGIC. Our decision follows.
FACTS
The following cruise itineraries in question involve the transportation of
passengers aboard the non-coastwise-qualified DISNEY MAGIC (the “vessel”):
First Itinerary
Saturday – San Juan, Puerto Rico (embark)
Sunday – At Sea
Monday – Castaway Cay, Bahamas
Tuesday – Port Canaveral, Florida (disembark)
Disney would also like to do this same itinerary in reverse, e.g. beginning in Port Canaveral and ending in San Juan.
Second Itinerary
Saturday – Port Canaveral, Florida (embark)
Sunday – Castaway Cay, Bahamas
Monday – At Sea
Tuesday – San Juan, Puerto Rico
Wed – At Sea
Thursday – Port Canaveral, Florida (disembark)
ISSUES
Whether the first proposed cruise itinerary in which passengers embark in San Juan, Puerto Rico, sail onboard to the vessel to the Bahamas and disembark in Port Canaveral, Florida, or the reverse, constitute an engagement in coastwise trade in violation of 46 U.S.C. § 55103.
Whether the second proposed cruise itinerary in which passengers embark in Port Canaveral, Florida; sail onboard the vessel to the Bahamas and San Juan, Puerto Rico; and disembark the vessel in Port Canaveral, Florida, constitute an engagement in coastwise trade in violation of 46 U.S.C. § 55103.
LAW and ANALYSIS
Issue 1
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)(2013). 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 trade; and
(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.
Pursuant to 46 U.S.C. § 55104(b), “[e]xcept as otherwise provided in this section, a vessel not qualified to engage in the coastwise trade may transport passengers between a port in Puerto Rico and another port in the United States.” The regulations promulgated under the authority of § 55104(b) further provide:
An exception to the prohibition in this section is the transportation of passengers between ports in Puerto Rico and other ports in the U.S. on passenger vessels not qualified to engage in the coastwise trade. Such transportation is permitted until there is a finding under 46 U.S.C. 289c that a qualified U.S.-flag passenger vessel is available for such service.
See 19 C.F.R. § 4.80a(c). To date, no qualified U.S.-flag passenger vessel service between ports in Puerto Rico and other ports in the U.S. exists. Accordingly, the subject vessel, as a non-coastwise qualified vessel, may transport passengers between Puerto Rico and other ports in the U.S. Therefore, the first proposed itinerary, in which passengers will be transported on the subject vessel between San Juan, Puerto Rico and Port Canaveral, Florida and between Port Canaveral and San Juan is not a violation of the coastwise laws pursuant to 46 U.S.C. § 55104(b) and 19 C.F.R. § 4.80a(c).
Issue 2
With regard to the second proposed cruise itinerary, insofar as the passengers will embark the vessel in Port Canaveral, Florida and will disembark the vessel in Port Canaveral, Florida, the vessel will not be transporting passengers between different U.S. coastwise points. Accordingly, the first proposed cruise itinerary would not violate 46 U.S.C. § 55103.
HOLDING
The first proposed cruise itinerary in which passengers embark in San Juan, Puerto Rico, sail onboard the vessel to the Bahamas and disembark in Port Canaveral, Florida, or the reverse, does not constitute an engagement in coastwise trade in violation of 46 U.S.C. § 55103.
The second proposed cruise itinerary in which passengers embark in Port Canaveral, Florida, sail onboard the vessel to the Bahamas and San Juan, Puerto Rico; and disembark the vessel in Port Canaveral, Florida, is not a violation of the coastwise laws pursuant to 46 U.S.C. § 55104(b).
Sincerely,
George Frederick McCray
Supervisory Attorney-Advisor/Chief
Cargo Security, Carriers and Restricted Merchandise Branch
Office of International Trade, Regulations & Rulings