VES-5-29-OT:RR:BSTC:CCI H052776 JLB
Mr. George R. Tuttle, III
Law Offices of George R. Tuttle
One Embarcadero Center, Suite 730
San Francisco, California 94111-4044
RE: Electronic Information for Outward Cargo Required in Advance of Departure; 19 C.F.R. § 192.14(c)(4)(i)
Dear Mr. Tuttle:
This letter is in response to your correspondence on behalf of your client, Matson Navigation Company, Inc., dated February 18, 2009, in which you request clarification on 19 C.F.R. § 192.14(c)(4)(i) as it relates to commercial cargo that is transported between ports in the United States, and then re-laden on a different vessel for exportation. Our ruling on your request follows.
FACTS
Matson Navigation Company, Inc. (“Matson”) is a principal carrier of cargo in both the U.S. domestic and international trades. The company’s main routes are from West Coast ports (Seattle, Oakland and Long Beach) to Hawaii and outbound container service from Hawaii to Guam to the Mid-Pacific region and China. Containers loaded in Seattle and Oakland, destined for the Mid-Pacific region or China, will be unladen in Honolulu, Hawaii and then laden aboard a different outbound vessel. The containers that are ultimately destined for the Mid-Pacific region will be unladen in Guam and loaded onboard contract vessels for service to outlying ports. Containers that are bound for China will remain onboard the vessel in Guam with the vessel continuing to Ningbo and Shanghai, China. The vessel will then return directly to Long Beach.
Service to Honolulu from the various U.S. ports is offered on a limited basis. Service to Honolulu from Seattle is provided only on a weekly basis through Oakland, on Saturdays. Service to Honolulu from Oakland is provided twice weekly on Tuesdays
and Thursdays or Fridays. Service to Honolulu from Long Beach is also provided twice weekly on Wednesdays and Saturdays. The Wednesday Long Beach to Honolulu vessel arrives in Honolulu on Sunday and departs for Guam on Tuesday.
Matson currently restricts the loading of export cargo containers at the initial port of lading until the exporter or agent supplies the company with the Electronic Export Information (“EEI”) Internal Transaction Number (“ITN”) or exemption legend, and has waited 24 hours from the receipt of the ITN information in accordance with what the company believes are the requirements of 19 C.F.R. § 192.14(c)(4)(i). Additionally, the bill of lading and the EEI, when required, identifies the port of exportation as Honolulu, Hawaii, the name of the vessel as the one that is departing Hawaii, and indicates the date of exportation as the date the vessel departs Honolulu. This practice can restrict the ability of Matson to reposition cargo in Oakland or Seattle to a different vessel for transportation to Hawaii, where the container will be loaded onto another vessel for exportation from the United States. Thus, you seek clarification as to whether the provisions of 19 C.F.R. § 192.14(c)(4) apply to the loading of cargo at an initial port of lading, such as Seattle or Oakland, or the last port of lading prior to exportation, such as Honolulu, for containers that will be discharged in Honolulu and re-laden onto a different outbound vessel.
ISSUE
Whether a vessel carrier may load containerized cargo at its initial port of lading without first receiving an electronic filing citation or an appropriate exemption statement under 19 C.F.R. § 192.14(c)(4)(i) if the cargo is to be transported between ports in the United States, then re-laden on a different vessel for the purpose of being transported to a foreign country?
LAW AND ANALYSIS
Section 343(a) of the Trade Act of 2002 (Pub. L. 107-210, 116 Stat. 933, enacted on August 8, 2002), as amended by section 108 of the Maritime Transportation Security Act of 2002 (Pub. L. 107-295, 116 Stat. 2064, enacted on November 25, 2002), codified at 19 U.S.C. § 2071, required the Secretary of the Treasury [now the Secretary of Homeland Security] to promulgate final regulations providing for the mandatory collection of electronic cargo information by the Customs Service [now U.S. Customs and Border Protection (“CBP”)], either prior to the arrival of the cargo in the United States or its departure from the United States by any mode of commercial transportation (sea, air, rail, or truck).
In accordance with the parameters set forth in the aforementioned statutory authority, a document was published in the Federal Register (68 F.R. 43574) on July 23, 2003, proposing to amend the CBP regulations in order to require the advance electronic transmission of cargo information prior to its being brought into, or sent from, the United States by sea, air, rail, or truck. The Final Rule was published as CBP Dec. 03-32 on December 5, 2003 (68 F.R. 68140, 68176) with compliance for the CBP regulations pertaining to the mandatory, pre-departure electronic filing of export cargo information through the Automated Export System (“AES”) not required until September 30, 2008. (See CBP Dec. No. 08-20, published in the Federal Register on June 9, 2008 (73 F.R. 32466)).
CBP promulgated these regulations at Title 19, Code of Federal Regulations, section 192.14 (19 C.F.R. § 192.14). These regulations require that prior to any commercial cargo being transported out of the United States by vessel, aircraft, rail, or truck, certain cargo information must be electronically transmitted to CBP. Pursuant to 19 C.F.R. § 192.14(b)(1)(i), the United States Principal Party in Interest (“USPPI”) or its authorized agent must comply with the following in order to ensure CBP has sufficient time to examine the data before the vessel departs:
(1) Time for presenting data —(i) For vessel cargo, the USPPI or its authorized agent must transmit and verify system acceptance of export vessel cargo information no later than 24 hours prior to departure from the U.S. port where the vessel cargo is to be laden;
Section 192.14(c)(4)(i) provides that a vessel carrier may not load cargo without first receiving an electronic filing citation, or an appropriate exemption statement, for the cargo:
(4) Carrier responsibility—(i) Loading of cargo. The carrier may not load cargo without first receiving from the USPPI or its authorized agent either the related electronic filing citation as prescribed under paragraph (c)(3) of this section, or an appropriate exemption statement for the cargo as specified in paragraph (d) of this section.
The Department of Commerce, Bureau of Census regulations, 15 C.F.R. Part 30, contain the mandatory automated export system filing provision for all shipments requiring shipper’s export declaration information. Pursuant to 15 C.F.R. § 30.4(b)(2)(i), “[f]or vessel cargo, the USPPI or the authorized agent shall file the EEI required by § 30.6 and provide the filing citation or exemption legend to the exporting carrier twenty-four hours prior to loading cargo on the vessel at the U.S. port where the cargo is laden.”
Matson currently restricts the loading of export cargo containers at the initial port of lading until the exporter supplies the company with the EEI ITN or exemption legend, and has waited 24 hours from the receipt of the ITN information in accordance with what the company believes are the requirements of 19 C.F.R. § 192.14(c)(4)(i). You seek clarification as to whether those requirements apply to the loading of cargo at its initial port of lading, such as Seattle or Oakland, or its last port of lading prior to exportation, such as Honolulu, for containers that will be discharged in Honolulu and re-laden onto a different outbound vessel. You assert that the phrases “loading of cargo” in 19 C.F.R. § 192.14(c)(4)(i) and “departure from the U.S. port where the vessel cargo is to be laden” in 19 C.F.R. § 192.14(b)(1)(i) are ambiguous with regard to this issue.
The term “port of exportation” is referenced in 19 C.F.R. § 192.14(c)(2)(vi) as follows: “[p]ort of exportation (the port where the outbound cargo departs from the United States…the USPPI or its authorized agent must report the port of exportation as known when the USPPI or its agent tenders the cargo to the outbound carrier…)”. (Emphasis added) We also find instructive 19 C.F.R. § 192.1 which defines “export” as “the transportation of merchandise out of the U.S. for the purpose of being entered into the commerce of a foreign country.” Furthermore, we note that the term “port of export” is specifically defined in 15 C.F.R. § 30.1(c) as the “seaport or airport where the goods are loaded on the exporting carrier that is taking the goods out of the United States, or the port where exports by overland transportation cross the U.S. border into a foreign country.”
Accordingly, upon reviewing the aforementioned authority we have determined that 19 C.F.R. § 192.14(c)(4)(i) does not preclude the vessel carrier from loading the containerized cargo at its initial port of lading, i.e. Seattle or Oakland, without first receiving an electronic filing citation or an appropriate exemption statement for the cargo since the containers will be re-laden aboard a different vessel for export at a subsequent U.S. port, i.e. Honolulu. At that time, containers from Seattle and Oakland destined for the Mid-Pacific region or China will be discharged and then laden aboard an outbound vessel, which will result in the filing of a new bill of lading and the prior timely transmittal of the EEI. Thus, with respect to the factual scenarios under consideration, Matson correctly identifies the port of exportation as Honolulu, Hawaii on the bill of lading and the EEI correctly indicates the date of exportation as the date the outbound vessel departs Honolulu. Consequently, pursuant to 19 C.F.R. § 192.14(c)(4)(i), the vessel carrier may not load the containers at the port of exportation (Honolulu) without first receiving the electronic filing citation or the appropriate exemption statement from the exporter in accordance with the requirements set forth therein.
HOLDING
A vessel carrier may load containerized cargo at its initial port of lading without first receiving an electronic filing citation or an appropriate exemption statement under 19 C.F.R. § 192.14(c)(4)(i) if the cargo is to be transported between ports in the United States, then re-laden on a different vessel for the purpose of being transported to a foreign country.
Sincerely,
Glen E. Vereb, Chief
Cargo Security, Carriers and Immigration Branch