VES-3-CO:R:IT:C 111446 LLB
Mr. J. Kelly Duncan
Jones, Walker, Waechter, Poitevent,
Carrere and Denegre
201 St. Charles Avenue
New Orleans, Louisiana 70170-5100
RE: Coastwise trade; Foreign-built derrick barges; Construction
cranes; Pipelaying; 46 U.S.C. App. 883
Dear Mr. Duncan:
Reference is made to your letter of December 12, 1990, in
which you request that we issue a ruling on the proposed use by
your client of a foreign-built, United States-flag, derrick
barge in the Gulf of Mexico. You ask that we accord your
request confidential treatment, as the release of information
concerning this proposal might prove detrimental to your client's
competitive position. We accede to your request regarding
confidentiality.
FACTS:
It is proposed that a foreign-built, United States-
documented derrick barge would be employed in operations in the
Gulf of Mexico. The non-self-propelled vessel would be used in
the lifting and setting of jackets and decks related to the
construction of offshore oil and gas platforms. It is stated
that the barge would remain stationary when performing this
lifting and setting operation, and that the transfer of
materials would be accomplished wholly by operation of the
vessel's crane except for incidental movement.
It is also proposed that the vessel in question would be
used in pipelaying operations in the Gulf of Mexico. It is
stated that the vessel might need to load and transfer pipe to
be paid-out in the course of pipelaying operations, and that
crewmembers and technicians necessary to assist in those
operations would be aboard at the time the subject procedures are
under way.
ISSUE:
Whether the coastwise laws are violated when a non-
coastwise-qualified stationary vessel is used in construction
operations in the Gulf of Mexico, or when such a vessel, while
under way, assists in pipelaying operations in that body of
water.
LAW AND ANALYSIS:
Title 46, United States Code App., section 883 (46 U.S.C.
App. 883) in pertinent part, prohibits the transportation of
merchandise 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.
Under Section 4(a) of the Outer Continental Shelf Lands Act
of 1953, as amended (43 U.S.C. 1333(a) (OCSLA)), 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. The provisions for dutiability of merchandise, as well as
the coastwise and other navigation laws, apply to production
platforms. C.S.D. 83-52.
Customs has held that the use of a non-coastwise-qualified
crane vessel to load and unload cargo is not coastwise trade and
does not violate 46 U.S.C. App. 883, provided, that any movement
of merchandise is effected exclusively by the operation of the
crane and not by movement of the vessel, except for necessary
movement which is incidental to a lifting operation while it is
taking place. However, movement of merchandise while it is
aboard the vessel or suspended from the crane, even between two
points within a harbor, which is neither necessary nor incidental
to a lifting operation by the crane would constitute coastwise
transportation of merchandise within the purview of 46 U.S.C.
App. 883. In the present matter it is stated that the barge
will remain stationary during actual lifting and setting
operations. In light of these facts, we find that the proposed
lifting and setting operation is permissible under 46 U.S.C. App.
883.
With regard to the pipelaying portion of the proposed
operation, it is not clear from the facts as presented exactly
what role is contemplated for the vessel in question. It is not
discernable from the proposal whether the vessel in question
would be used to take piping materials aboard at a coastwise
point and transfer those materials to a pipelaying vessel at
another such point; whether materials would be taken from a
coastwise point to a point in the Gulf of Mexico which is not an
operating site on the outer Continental Shelf and there transfer
them; whether the materials will be taken from a coastwise point
and actually paid-out from that vessel in the course of
pipelaying operations. The legality depends upon the character
of the intended operation. Only in circumstances where vessel is
used to transport materials either from or to a non-coastwise
point, or is actually laying the piping materials in question
will the proposed usage be permissible under the coastwise laws.
With regard to the transportation of the non-self-propelled
vessel itself, you should be aware that pursuant to 46 U.S.C.
App. 316(a), only a vessel properly documented under the laws of
the United States with an endorsement for the coastwise trade may
be employed to tow the vessel if such tow is to be between two
coastwise points.
HOLDING:
Following a full review of the facts and analysis of the law
and applicable precedents, we have determined that the use of a
non-coastwise-qualified crane barge as detailed in this case is
permissible under 46 U.S.C. App. 883, with the exception that
such vessel may not be used to lade materials at one coastwise
point and unlade them at another, regardless of whether those
points may be located within territorial waters or on the outer
Continental Shelf.
Sincerely,
B. James Fritz
Chief
Carrier Rulings Branch