VES-10-03-RR:IT:EC 116111 CK
Mr. Bruce A. King
Garvey Schubert Barer
Second & Seneca Building
1191 Second Avenue
18th Floor
Seattle, Washington 98101-2939
RE: Coastwise Trade; Crane Barge; Supply Barge; Towing; 46 U.S.C. App. §§ 883, 289, and 316(a)
Dear Mr. King:
This is in response to your letter on behalf of your client, Kiewit Pacific Co., dated January 20, 2004, regarding the use of a foreign-flagged crane barge in building two breakwaters in Alaska. Our ruling on this matter is set forth below.
FACTS:
Kiewit Pacific Co. (“Kiewit”) is an U.S. corporation that operates vessels in the U.S. coastwise trade. Kiewit proposes to build two breakwaters near Wrangell, Alaska that will be constructed out of rock. Kiewit plans to bareboat charter a Canadian crane barge that is reinforced to carry a mobile crane. This barge will anchor by means of approximately four anchors. A deck winch controls the 800 to 1000 feet of wire rope that will connect each anchor to the barge. As the breakwaters are constructed, the barge will move along the project by manipulating the anchor wires. Between these movements, as the barge continues along the path of construction, the barge will be secured in place with one or more spuds.
If it is necessary to move the crane barge so far that its anchors need to be reset, the movement of the barge will be done with the assistance of a coastwise-qualified tugboat. If the crane barge is otherwise towed between two or more points within the United States, this will also be done using a coastwise-qualified tugboat.
In addition to the crane barge, a coastwise-qualified flat deck barge will bring rock to the construction site. After the supply barge is towed to the jobsite, it will be lashed to the crane barge. The crane on the crane barge will hoist the rock from the supply barge and swivel around to drop the rock onto the breakwater that is under construction.
When the supply barge is out of rock, it will be towed away to be reloaded then returned to be re-lashed to the crane barge. There may be more than one coastwise-qualified supply barge that is used in this fashion. The supply barges will be towed to and from the job site by means of coastwise-qualified tugboats.
As construction of the breakwaters continues, the crane barge will adjust its anchor wires to move along the path of the construction so that it can deposit the rock in the correct location. The supply barge lashed to the crane barge will move along with the crane barge as the crane barge moves. At no time during these movements, or while the crane barge is under tow between coastwise points, will any rock be on the crane barge or suspended from its crane.
It is also possible that additional construction material or equipment will be carried on the supply barges, or that equipment and waste material will be transferred from the breakwater to the supply barge. Again, at no time will merchandise be aboard the crane barge or suspended from the crane while moving. Additionally, no personnel will be aboard the crane barge while it moves by winch or while under tow other than the personnel who operate the crane or the anchor winches.
ISSUES:
Whether the proposed operation constitutes a carriage of merchandise in violation of 46 U.S.C. App. §883.
Whether the proposed operation constitutes a carriage of passengers in violation of 46 U.S.C. App. §289.
Whether the movement of the lashed supply barge is towing in violation of 46 U.S.C. App. §316(a).
LAW AND ANALYSIS:
Title 46, United States Code Appendix, § 883 (the merchandise coastwise law often called the "Jones Act") prohibits the transportation of merchandise between United States coastwise points, 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 (i.e., a coastwise-qualified vessel).
Pursuant to section 4.80b, Customs Regulations (19 CFR § 4.80b), a coastwise transportation of merchandise takes place, within the meaning of the 46 U.S.C. App. § 883, when merchandise laden at a point embraced within the coastwise laws ("coastwise point") is unladen at another coastwise point, regardless of the
origin or ultimate destination of the merchandise.
In interpreting the coastwise laws, U.S. Customs and Border Protection (CBP) has ruled that a point in United States territorial waters is a point in the United States embraced within the coastwise laws, including points within a harbor. The territorial waters of the United States consist of the territorial sea, 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.
CBP has long held that the use of a non-coastwise-qualified crane vessel to load and unload cargo or construct or dismantle a marine structure is not coastwise trade and does not violate the coastwise laws, 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. Thus, such a crane barge could lift
merchandise with its crane at one coastwise point, be pivoted while remaining in one location, and put down the merchandise at a place other than that from which it was lifted. The crane barge would be prohibited from lifting merchandise with its crane at one coastwise point, not remain stationary, and while the merchandise is suspended from the crane, placing the merchandise at a second coastwise point (See, CBP ruling letters 106351, dated November 1, 1983; 108213, dated March 6, 1986; 115630 GEV, dated March 25, 2002; and 115940, dated April 17, 2003).
In the facts you present, a foreign crane barge will be moored in place by four anchors. While the barge remains stationary, its crane will swing its arm to a supply barge lashed to the crane barge in order to pick up boulders which will be placed in the water to create a breakwater. The crane barge, without any rock on board or suspended from its crane, will be moved along the construction line by manipulation of its anchor lines. If further repositioning is needed the movement will be accomplished by a coastwise-qualified tug. The use of the foreign crane barge as described above does not constitute a violation of 46 U.S.C. App. §883.
Vessels moving passengers between such a stationary platform or any other coastwise points must be documented for coastwise trade. 46 U.S.C. App. §289. For purposes of Section 289, "passenger" is defined as "... any person carried on a vessel who is not connected with the operation of such vessel, her navigation, ownership, or business." (19 CFR §4.50(b). In the facts you present, no personnel will be aboard the crane barge while it moves by winch or while under tow other than the personnel who operate the crane or the anchor winches. As long as only those persons who are connected with the operation of the crane barge and the barge’s movement are aboard at the time the crane barge is moving there is no violation of 46 U.S.C. App. §289.
Title 46, United States Code Appendix, § 316(a) (46 U.S.C. App. § 316(a), the towing coastwise law) prohibits the use of any vessel not having in force a certificate of documentation endorsed for the coastwise trade (46 U.S.C. § 12106) to tow any vessel other than a vessel in distress, from any point or place embraced within the coastwise laws of the United States to another such port or place, either directly or by way of a foreign port or place, or for any part of such towing. See also, 19 CFR §4.92.
You state that the facts you present are identical to those approved in HQ 223946 (September 8, 1992), HQ 112157 (May 27, 1992), and HQ 112541 (December 3, 1992). You state that CBP approved the movement as not coastwise towing, when a foreign barge moved by its anchor cables, also moved the coastwise supply barge lashed to it. We do not find HQ 223946 nor HQ 112157 to be on point. The issues in HQ 223946 and HQ 112157 concerned possible violations of 46 U.S.C. App. §§289 and 883. However, HQ 112541 does state that when a crane barge and work barge move in unison between coastwise points by anchor adjustments, no violation of 46 U.S.C. App. §316(a) will occur. This case presents similar facts, inasmuch as the supply barge will be lashed to the crane barge in order to move in unison when the crane barge will be moved by the adjustment of its anchor wires. This movement therefore does not constitute a violation of 46 U.S.C. App. §316(a).
HOLDING:
The use of the foreign crane barge, coastwise-qualified supply barge, and coastwise-qualified tugs as described above does not constitute a violation of 46 U.S.C. App. §§883, 289 or 316(a).
Sincerely,
Glen E. Vereb
Chief
Entry Procedures and Carries Branch