VES-3-07-CO:R:P:C 110127 GV
Thomas L. Mills, Esq.
Dyer, Ellis, Joseph & Mills
Watergate Suite 1000
600 New Hampshire Avenue, NW.
Washington, D.C. 20037
RE: Request for ruling as to provisions of 46 U.S.C. App. 883
Dear Mr.Mills:
This is in reference to your letter of March 29, 1989,
withdrawing your ruling request of March 21, 1989, requesting a
ruling as to whether certain activities of a foreign-flag barge
are in compliance with 46 U.S.C. App. 883.
FACTS:
Your client operates a towing operation in a United States
port which serves vessels engaged in the foreign trade,
specifically the export of chemicals. Because of a temporary
shortage of shoreside chemical storage facilities, the client
proposes to have the chemicals loaded onto a foreign-flag barge,
which it owns. The subject barge would then be put to use in any
of the two following alternatives:
Alternative A:
After loading, the barge will be towed by a U.S.-flag tug to
a location within the harbor of the same port within United
States territorial waters and will then be anchored or docked at
that location. While within the territorial waters, the barge
will be a stationary storage facility. Its only movements, except
for those described below, will be those necessary for the safety
of the vessel.
At some point, a U.S.-flag. tug will tow the barge to a
point outside the territorial waters of the United States. While
outside the territorial waters of the United States, a foreign
flag vessel will lighter the chemicals for a voyage to a foreign
port.
2
A U.S.-flag tug will tow the barge back to the same or
nearby point at which it was loaded, and any remaining chemicals
will be discharged.
Alternative B:
After loading, the barge will be towed by a U.S.-flag tug to
a location within the harbor of the same port within United
States territorial waters and will then be anchored or docked at
that location. The barge will be a stationary storage facility.
Its only movements will be those necessary for the safety of the
vessel.
At some point, a U.S.-flag tug will tow the barge back to
the same or nearby point at which it was loaded and all of its
chemical cargo will be pumped from the barge to the shoreside
chemical loading facility.
ISSUE:
Whether the use of a foreign-flag barge as a chemical
storage facility described in the two alternatives above is
incompliance with the provisions of 46 U.S.C. App. 883.
LAW AND ANALYSIS:
Title 46, United States Code Appendix, 883 (46 U.S.C. App.
883), often called the "Jones Act", provides in part, that no
merchandise shall be transported between points in the United
States embraced within the coastwise laws, either directly or via
a foreign port, or for any part of the transportation, in any
vessel other than a vessel built in and documented under the laws
of the United States and owned by persons who are citizens of the
United States.
Pursuant to 4.80b, Customs Regulations (19 CFR 4.80b) a
coastwise transportation of merchandise takes place, within the
meaning of the coastwise laws, when merchandise laden at point
embraced within the coastwise laws ("coastwise point") is unladen
at another coastwise point, regardless of the origin or ultimate
destination of the merchandise.
Points embraced within the coastwise laws discussed above
include all points within the territorial waters of the United
States, including points within a harbor, as well as artificial
islands, installations, and devices permanently or temporarily
attached to the seabed of the outer continental shelf for the
purpose of exploring for, developing or producing resources
therefrom. The territorial waters of the United States consist
of the territorial sea, defined as the belt, 3 nautical miles
wide, adjacent to the coast of the United States and seaward of
the territorial sea baseline.
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In regard to Alternatives A and B, the Customs Service
consistently has held that the use of a foreign-flag vessel as a
storage facility in United States territorial waters does not
violate the coastwise laws, or any other law administered by the
Customs Service, provided that the vessel remains stationary.
Customs also has held that if the vessel is being loaded or
unloaded and must be moved to another location because of stress
of weather or other reason involving the vessel's safety,
subsequently is returned to the same point to continue its
loading or unloading, and loads or unloads no merchandise at any
other point in the United States, the coastwise laws are not
violated.
We note that in regard to Alternative A, the towing of the
barge to a point outside U.S. territorial waters and the
subsequent lightering by a foreign-flag vessel is not a movement
in the coastwise trade. However, if the barge is to be towed
ashore for the discharge of any remaining chemicals, it must be
returned to the same point at which it was laded in order to be
in compliance with 46 U.S.C. App. 883. If it is to be towed
ashore empty, it is not required to return to the point of lading
and no violation of said statute will occur.
Accordingly, with respect to Alternative B, when the subject
barge is no longer to be used as a storage facility and is towed
ashore, it must be returned to the same point ar which it was
laded. To return it to any point other than that at which it was
laded and then pump the chemical cargo to the shoreside chemical
loading facility constitutes a violation of 46 U.C.C. App. 883.
HOLDING:
The use of the foreign-flag barge as a chemical storage
facility described in Alternatives A and B does not constitute a
violation of 46 U.S.C. App. 883 provided the subject barge, if it
is no longer used as such a facility and is towed ashore for
unlading either in whole or in part, returns to the same point at
which it was originally laded.
Sincerely,
B. James Fritz
Chief
Carrier Rulings Branch