VES-3-02-OT:RR:BSTC:CCR H319836 AMW
Ms. Emily Huggins Jones, Esq.
Squire Patton Boggs (US) LLP
4900 Key Tower
127 Public Square
Cleveland, Ohio 44114
RE: Coastwise Transportation; Undersea Cable Recovery; 46 U.S.C. § 55102; 46 U.S.C. § 55109; 19 C.F.R. § 4.80b.
Dear Ms. Huggins Jones:
This letter is in response to your May 27, 2021 ruling request on behalf of your client Subsea Environmental Services (U.S.) LLC (“SES”) regarding whether certain activities related to the recovery of submarine fiber-optic cable by a non-coastwise qualified vessel on the U.S. Outer Continental Shelf (“OCS”), as described below, would violate the coastwise laws. Our decision follows.
FACTS
The following facts are from your ruling request and supporting information transmitted on August 30, 2021. Your client has requested U.S. Customs and Border Protection (“CBP”) determine whether certain operations related to the recovery of fiber-optic cable from the seabed of the OCS would violate the Jones Act, 46 U.S.C. § 55102, and the Dredging Act of 1906 (the “Dredging Statute”), 46 U.S.C. § 55109.
You state the proposed operation is intended to recover three sections of decommissioned submarine telecommunications cable. These cable segments were once part of the TAT-14 system of fiber-optic cable installed in 2001, serving as part of a telecommunications pathway between the United States and Europe. The subject cable was decommissioned in December 2020, and SES was engaged by the cable’s ownership to recover three sections of cable. You have provided the exact coordinates of the cable segments to be recovered, which extend from U.S. territorial waters off the coast of the State of New Jersey into the seabed of the OCS. You state that recovery of the cable portions existing in U.S. territorial waters will be conducted by a separate entity utilizing coastwise-qualified vessels, and is not subject to the present request.
In recovering the cable portions existing on the U.S. OCS, SES proposes to use the non-coastwise-qualified M.V. REBECCA (the “Cable Recovery Vessel”). The Cable Recovery Vessel is a specially equipped cable recovery vessel, outfitted with cable recovery winches and drums, hydraulic tensioners, cable cutters, a full set of grapnel and ropes, and a hydrostatic release hook. The Cable Recovery Vessel is further equipped with below-deck cable storage in which the decommissioned cable will be stored upon recovery.
You state that the Cable Recovery Vessel will be mobilized from a port outside of the United States and will proceed directly to the cable recovery sites on the U.S. OCS. Prior to the Cable Recovery Vessel’s arrival, a separate contractor will sever the portion of each cable segment closest to U.S. territorial waters and mark the OCS end with a buoy. Upon arrival at each cable segment, the Cable Recovery Vessel will raise the buoyed end of cable to its deck, attach the cable to its deck winch, and pull in the full length of each cable. After all cable segments are recovered, the Cable Recovery Vessel will depart the U.S. OCS and transport the cable to South Africa for processing and disposal.
ISSUES
Whether the subject cable recovery operation by the non-coastwise-qualified Cable Recovery Vessel violates the Jones Act, 46 U.S.C. § 55102?
Whether the subject cable burial operations by the non-coastwise-qualified Cable Recovery Vessel violates the Dredging Statute, 46 U.S.C. § 55109?
LAW AND ANALYSIS
Issue One: Whether the Cable Recovery Operation Violates 46 U.S.C. § 55102
First, we determine whether the proposed cable recovery operation violates the Jones Act, 46 U.S.C. § 55102. 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 transportation of merchandise, the Jones Act, is found at 46 U.S.C. § 55102, and provides in pertinent part:
Except as otherwise provided in this chapter or chapter 121 of this title, a vessel may not provide any part of the transportation of merchandise by water, or by land and water, between points in the United States to which the coastwise laws apply, either directly or via a foreign port, unless the vessel—
is wholly owned by citizens of the United States for purposes of engaging in the coastwise trade; and
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.
Pursuant to 19 U.S.C. § 1401(c), the word “merchandise” is defined as “goods, wares, and chattels of every description, and includes merchandise the importation of which is prohibited, and monetary instruments as defined in section 5312 of Title 31.” For purposes of the Jones Act, merchandise also includes “valueless material.” 46 U.S.C. § 55102(a)(2). The CBP Regulations promulgated under the authority of 46 U.S.C. § 55102 provide that a coastwise transportation of merchandise takes place when merchandise laden at a coastwise point is unladen at another coastwise point, regardless of origin or ultimate destination. 19 CFR § 4.80b(a).
Based on the foregoing, we find that the cable recovery operation does not violate the Jones Act. As noted above, “merchandise” within the meaning of the Jones Act includes “valueless material.” And CBP has previously ruled that out-of-service cable resulting from a “cable clearance operation” constitutes valueless material and therefore falls within the definition of “merchandise” for purposes of 46 U.S.C. § 55102. E.g., HQ 113927 (May 9, 1997). CBP has also determined, however, that the retrieval of out-of-service cable and the transportation of that cable to a port or place outside the United States does not involve the transportation of merchandise between two points embraced by the coastwise laws. Id. As such, the proposed lading of out-of-service cable from the seabed of the OCS and subsequent unlading at a port in South Africa does not constitute transportation in violation of the Jones Act.
Issue Two: Whether the Cable Recovery Operation Violates 46 U.S.C. § 55109
Second, we determine whether the proposed cable recovery operation is in violation of the Dredging Statute, 46 U.S.C. § 55109. Pursuant to 46 U.S.C. § 55109, only coastwise-qualified vessels may engage in dredging in the navigable waters of the United States, providing, in pertinent part:
[A] vessel may engage in dredging in the navigable waters of the United States only if—
(1) the vessel is wholly owned by citizens of the United States for purposes of
engaging in the coastwise trade;
(2) the charterer, if any, is a citizen of the United States for purposes of
engaging in the coastwise trade; and
(3) the vessel has been issued a certificate of documentation with a coastwise endorsement under chapter 121 of this title or is exempt from documentation but would otherwise be eligible for such a certificate and endorsement
Dredging is defined as “excavation” by any means:
The word “excavate” is derived from the Latin word meaning to hollow out. Its common, plain and ordinary meaning is to make a cavity or hole in, to dig out, hollow out, to remove soil by digging, scooping out or other means. The common plain and ordinary meaning of the word “dredging” is the removal of soil from the bottom waters by suction or scooping or other means.
CBP has long held that the term “dredging” within the meaning of 46 U.S.C. § 55109, is “the use of a vessel equipped with excavating machinery in digging up or otherwise removing submarine material.” See HQ 103692 (Dec. 28, 1978, published as Customs Service Decision (C.S.D.) 79-331); HQ 109108 (Nov.13, 1987); HQ 109910 (Jan. 26, 1989, published as C.S.D. 89-64). In contrast, CBP has also held that the use by cable-laying vessels of cable-burial devices employing a jetting action resulting in the emulsification of the seabed surrounding the cable does not constitute an engagement in “dredging.” See, e.g., HQ 115646 (Apr. 12, 2002).
Based on the foregoing, we find that the cable recovery operation does not violate the Jones Act. In the present matter, you state that the Cable Recovery Vessel will lift the cable segments directly from the subsea floor, using the vessel’s drum wind. SES does not intend to use any form of jetting tool, mass flow excavation, or any other device that would otherwise disturb the seabed to remove sediment and create a path along the seabed. Because the Cable Recovery Vessel will not dig or otherwise remove submarine material, the proposed operation is not within the ambit of 46 U.S.C. § 55109. Accordingly, the proposed operation does not constitute dredging for the purposes of the Dredging Statute.
HOLDING
The proposed cable recovery operation by a non-coastwise-qualified vessel does not constitute “transportation” within the meaning of the Jones Act, 46 U.S.C. § 55102.
The proposed cable recovery operation does not constitute “dredging” within the meaning of the Dredging Statute, 46 U.S.C. § 55109.
Sincerely,
W. Richmond Beevers
Chief, Cargo Security, Carriers and Restricted Merchandise Branch
Office of International Trade, Regulations and Rulings
U.S. Customs and Border Protection