VES-3-15 CO:R:P:C 110783
Mr. John J. Bennett
Cahill, Gordon and Reindel
1990 K Street, N.W.
Washington, D.C. 20006
RE: Applicability of the coastwise laws to the transportation of
tension leg platform components
Dear Mr. Bennett:
Reference is made to your letter of January 17, 1990, in
which you request application of the findings contained in
Customs Service Decision 89-115 (C.S.D. 89-115) and ruling letter
110421 of September 1, 1989, to certain operations proposed by
your client.
FACTS:
In C.S.D. 89-115, Customs considered the applicability of
the coastwise laws to the fabrication, transportation, and
installation of a tension leg platform (TLP) on the United States
outer continental shelf (OCS). That ruling, issued to Shell
Offshore, Inc., contained numerous elements and findings which we
numbered. It is proposed to bid on this same Shell Offshore,
Inc., project upon which we have ruled, and we are requested to
rule whether numbered holdings 15 and 16 are applicable to the
present matter.
Your client, McDermott, Inc., proposes to use the foreign-
built launch barge INTERMAC 650 to transport, in separate
movements, the hull and deck of the TLP (as described in C.S.D.
89-115) from coastwise points on the U.S. Gulf Coast. These
components would be transported to an offshore launch site where
they would be "mated." The hull weighs approximately 22,300
long tons, and the deck some 21,300 long tons. The mated TLP
would then be moved to a site on the OCS which, it is stated, is
a coastwise point by virtue of section 4(a) of the Outer
Continental Shelf Lands Act (43 U.S.C. 1333(a)). The INTERMAC
650 is among those U.S.-flag launch barges listed in an inventory
of such vessels published in the Federal Register of June 27,
1988 (53 FR 24165).
ISSUE:
Does the transportation of TLP components from coastwise
points to an offshore launch site by the launch barge INTERMAC
650, and the subsequent movement of the "mated" components to an
operational site on the OCS violate the coastwise laws?
LAW AND ANALYSIS:
Section 27 of the Act of June 5, 1920, as amended (41 Stat.
999; 46 U.S.C. App. 883, often called the Jones Act), provides,
in pertinent part, that:
No merchandise shall be transported by water, or by land and
water, on penalty of forfeiture of the merchandise (or a
monetary amount up to the value thereof as determined by the
Secretary of the Treasury, or the actual cost of the
transportation, whichever is greater, to be recovered from
any consignor, seller, owner, importer, consignee, agent, or
other person or persons so transporting or causing said
merchandise to 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 other vessel 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 * * *.
Section 883 was amended by the Act of June 7, 1988 (Public
Law 100-329; 102 Stat. 588). Among other things, Public Law 100-
329 added the so-called launch barge amendment. Under this
provision,
* * * The transportation of any platform jacket in or on a
launch barge between two points in the United States, at one
of which there is an installation or other device within the
meaning of [43 U.S.C. 1333(a)], shall not be deemed
transportation subject to this section if the launch barge
has a launch capacity of 12,000 long tons or more, was built
as of June 7, 1988, and is documented under the laws of the
United States, and the platform jacket cannot be transported
on and launched from a launch barge of lesser launch
capacity that is identified by the Secretary of Transpor-
tation and is available for such transportation.
A list of U.S.-flag launch barges published by the Maritime
Administration under Public Law 100-329 is found in the June 27,
1988, issue of the Federal Register (53 FR 24165), with the
INTERTMAC 650 being included.
Section 4(a) of the Outer Continental Shelf Lands Act of
1953, as amended (67 Stat. 462; 43 U.S.C. 1333(a)) (OCSLA),
provides, in pertinent part, that the laws of the United States
are extended to:
* * * the subsoil and seabed of the outer Continental Shelf
and to all artificial islands, and all installations and
other devices permanently or temporarily attached to the
seabed, which may be erected thereon for the purpose of
exploring for, developing or producing resources therefrom
* * * to the same extent as if the outer Continental Shelf
were an area of exclusive Federal jurisdiction located
within a State."
Under this provision, Customs has ruled that the coastwise
laws and other Customs and navigation laws are extended to mobile
oil drilling rigs during the period they are secured to or
submerged onto the seabed of the United States OCS. The same
principles have been applied to drilling platforms, artificial
islands, and similar structures attached to the seabed of the OCS
for the purpose of resource exploration operations, including
warehouse vessels anchored over the OCS when used to supply
drilling rigs on the OCS.
By C.S.D. 89-115, holdings 15 and 16, the transportation of
the separate hull and deck components of a TLP on a foreign-built
launch barge from coastwise points to offshore launch points was
permitted, so long as the barge used had a launch capacity of
12,000 long tons or more, was built as of June 7, 1988, and was
documented under U.S. law.
These holding have not since been modified or revoked, only
further explained by issuance of ruling letter 110421 of
September 1, 1989. We find the circumstances presently under
consideration to be similar in nature and consider holdings 15
and 16 in C.S.D. 89-115 to be applicable.
HOLDING:
The launch barge INTERMAC 650 may be used to transport hull
and deck components for a tension leg platform, in separate
movements, each component weighing in excess of 12,000 long tons,
from points on the U.S. Gulf Coast to an offshore launch site.
The "mated" TLP may then be moved to a coastwise point on the OCS
without violating 46 U.S.C. App. 883, under authority of C.S.D.
89-115.
Sincerely,
B. James Fritz
Chief
Carrier Rulings Branch