VES-3-02 CO:R:IT:C 112716 JBW
Mr. Troy R. Holbritter
Meyer, Orlando & Evans
2300 America Tower
2929 Allen Parkway
Houston, Texas 77019
RE: Coastwise; Passengers; Voyage to Nowhere; SCUBA; Divers;
46 U.S.C. App. 289.
Dear Mr. Holbritter:
This letter is in response to your inquiry of April 29, 1993,
in which you request a ruling on the application of the coastwise
laws to the transportation of passengers for SCUBA diving
expeditions.
FACTS:
Your clients are purchasing the M/V SOUTHERN STAR, a foreign-
built vessel. The vessel will be used for the commercial carriage
of SCUBA diving expeditions in the Gulf of Mexico. The vessel will
always depart from Freeport, Texas, and travel to one of three
diving sites. Each site is approximately 110 miles off the Texas
gulf coast, beyond the territorial waters of the United States.
Upon completion of the diving expeditions, the vessel will return
with its passengers to the point of embarkation in Freeport. No
passengers will be permitted to leave the vessel at any point other
than Freeport, nor will passengers swim or dive in United States
territorial waters.
ISSUE:
Whether the transportation of SCUBA divers to a diving site
outside United States territorial waters is an engagement in the
coastwise trade that is prohibited by 46 U.S.C. App. 289.
LAW AND ANALYSIS:
The coastwise passenger law provides that:
No foreign vessel shall transport passengers
between ports or places in the United States
either directly or by way of a foreign port,
under a penalty of $200 for each passenger so
transported.
46 U.S.C. App. 289. The Customs Service has consistently
interpreted this proscription to apply to any vessel except a United
States built, owned, and properly documented vessel. See 46 U.S.C.A.
12106 & 12110 (West Supp. 1992), 46 U.S.C. App. 289, and 19
C.F.R. 4.80(a) (1992). Generally, the coastwise laws apply to
points within the territorial sea of the United States, 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, in cases where the baseline and the
coastline differ. Headquarters Ruling Letter 111275, dated November
13, 1990.
In interpreting the coastwise laws as applied to the
transportation of passengers, the Customs Service has ruled that the
carriage of passengers entirely within territorial waters, even
though the passengers disembark at their point of embarkation and
the vessel touches no other point, is considered coastwise trade
subject to the coastwise laws. E.g., Headquarters Ruling Letter
110990, dated May 21, 1990. However, the transportation of
passengers to the high seas or foreign waters and back to the
precise point of embarkation, often called a "voyage to nowhere," is
not considered coastwise trade. Id. An important corollary to this
rule is that a "voyage to nowhere" assumes the passengers do not
leave the vessel, even temporarily, at another United States point.
Id. Furthermore, the carriage of fishing parties for hire, even if
the vessel proceeds beyond territorial waters and returns to the
point of the passengers' embarkation, is considered coastwise trade.
Headquarters Ruling Letter 111051, dated August 16, 1990.
The Customs Service has determined that passengers swimming or
diving at points outside the territorial waters of the United States
are not leaving the vessel at another United States point.
Headquarters Ruling Letter 109899, dated December 23, 1988. Such a
trip would therefore not be prohibited by the coastwise laws
provided the voyage began and ended at the same port. Id. Applying
this conclusion to the facts in the present case, we determine that
the carriage of SCUBA expeditions to points outside United States
territorial waters is not an engagement in the coastwise trade that
is prohibited by 46 U.S.C. App. 289. This conclusion is premised
on your statement that the voyages will begin and end in Freeport
and that the passengers will not be permitted to leave the vessel at
other United States ports or in United States territorial waters.
HOLDING:
The carriage of SCUBA expeditions to points outside United
States territorial waters is not an engagement in the coastwise
trade that is prohibited by 46 U.S.C. App. 289 provided the divers
begin and end their voyage at the same United States point and the
divers do not dive or otherwise leave that vessel at other United
States points.
Sincerely,
Acting Chief