VES-3-02-OT:RR:BSTC:CCR H251654 WRB
Gary M. Haugen, Esq.
Bauer, Moynihan & Johnson, LLP
2101 Fourth Avenue
Suite 2400
Seattle, WA 98121-2324
RE: Coastwise Transportation; Towing; 46 U.S.C. §§ 55103; 55111; 55112; 19 C.F.R. § 4.50(b); 4.92
Dear Mr. Haugen:
This letter is in response to your letter dated March 20, 2014, in which you request a ruling on behalf of Harley Marine Services, Inc., (hereinafter “HMS”) on whether a non-coastwise-qualified vessel may be utilized as a training platform without violating 46 U.S.C. §§ 55103 and 55111. Our ruling on your request follows.
FACTS
The M/V BRATT, (hereinafter the “training vessel”) will be used in HMS’ tractor tug training program (the “training program”). The training will take place in the territorial waters of the U.S. Initially, training will take place in Puget Sound, predominately at the port of Seattle in Elliott Bay, Washington. The training vessel was built in Canada and is not eligible to engage in the coastwise trade. It is currently documented under the U.S. flag with a registry endorsement.
The training program is divided into two parts: Light Boat Handling and Assist Training. Light Boat Handling incorporates four modules: Open Water Training; Close Quarters Training; Incorporation of Headline and Bow Winch Operations; and, Emergency Maneuver Training. Assist Training introduces the numerous evolutions experienced during day-to-day ship and barge assist operations, and will occur in two situations: (l) planned assists; and (2) assists of opportunity. During planned assists, an HMS barge will be attached to an HMS tug for the specific purpose of providing training opportunities to the trainees in the program. Assists of opportunity training scenarios will be more impromptu. If a suitable HMS tug and tow are in the vicinity of the training, the trainer may use the opportunity to accelerate a trainee’s training. However, in the case of assists of opportunity, the other HMS vessels may be engaged on an actual commercial voyage when the training occurs.
ISSUES
1. Whether the use of a non-coastwise-qualified vessel as described above constitutes an engagement in coastwise trade in violation of 46 U.S.C. § 55103; and,
2. Whether the use of a non-coastwise-qualified vessel as described above constitutes towing in violation of 46 U.S.C. § 55111?
LAW AND ANALYSIS
Issue 1
With regard to the applicability of the coastwise passenger statute to the activities described in the FACTS section above, 46 U.S.C. § 55103, provides that no foreign vessel shall transport passengers “between ports or places in the United States to which the coastwise laws apply, either directly or by way of a foreign port,” under a penalty of $300 for each passenger so transported and landed. See also 19 C.F.R. § 4.80(b)(2). The coastwise laws generally apply to points in the territorial sea, which is 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.
Under 46 U.S.C. § 55103, a “passenger” is any person carried aboard a vessel “who is not connected with the operation of the vessel, her navigation, ownership, or business.” See also 19 C.F.R. § 4.50(b). In this regard, U.S. Customs and Border Protection (“CBP”) provides a strict interpretation of “passenger” defining the term as persons transported on a vessel unless they are “directly and substantially” connected with the operation, navigation, ownership or business of that vessel itself. See Customs Bulletin of June 5, 2002, Vol. 36, No. 23, at p. 50.
CBP has held that a person being trained or receiving instruction in the handling or navigation of a vessel, and whose presence onboard the vessel is required in order to receive such training or instruction, is not a “passenger.” Accordingly, if the vessel is used only for such training, then it would not be required to be documented to engage in the coastwise trade. See HQ H045778 (Dec. 11, 2008); HQ 114263 (Mar. 3, 1998); HQ 112479 (Jan. 6, 1993); see also HQ 111021 (Aug. 28, 1990); and HQ 111212 (Nov. 15, 1990. Individuals carried onboard to receive training or instruction are not “passengers” regardless of whether a fee is charged for the training program. See HQ H045778 (Dec. 11, 2008); and HQ 114283 (Mar. 27, 1998).
As regards the proposed use of the training vessel to provide training to students in vessel handling and navigation as detailed in the “Light Boat Handling” portion of the program of instruction, the sole use of the training vessel in connection with a bona fide instructional course in vessel handling and navigation with class or other instruction does not constitute coastwise trade within the meaning of 46 U.S.C. § 55103. Accordingly, the use of the subject non-coastwise-qualified vessel as a training platform would not violate 46 U.S.C. § 55103.
Issue 2
With regard to the applicability of the coastwise towing statute to the activities described in the FACTS section above, 46 U.S.C. § 55111 provides, in pertinent part:
(a) IN GENERAL.—Except when towing a vessel in distress, a vessel may not do any part of any towing described in subsection (b) unless the towing vessel—
(1) is wholly owned by citizens of the United States for purposes of engaging in the coastwise trade; and
(2) has been issued a certificate of documentation with a coastwise endorsement under chapter 121 of this title or is exempt from documentation but would otherwise be eligible for such a certificate and endorsement.
(b) APPLICABLE TOWING.—Subsection (a) applies to the towing of—
(1) a vessel between ports or places in the United States to which the coastwise laws apply, either directly or via a foreign port or place;
(2) a vessel from point to point within the harbors of ports or places to which the coastwise laws apply; or ….
The CBP Regulations at 19 C.F.R. § 4.92 provide, in pertinent part:
No vessel other than a vessel documented for the coastwise trade, or which would be entitled to be so documented except for its tonnage (see
§ 4.80), may tow a vessel other than a vessel in distress between points in the U.S. embraced within the coastwise laws, or for any part of such towing ….
“Towage service is the employment of one vessel to expedite the voyage of another.” Sacramento Navigation Co. v. Salz, 273 U.S. 326 (U.S. 1927). “A towage service is one which is rendered for the mere purpose of expediting her voyage, without reference to any circumstances of danger.” The Mercer, 297 F. 981 (2d Cir. N.Y. 1924). “When a tug is called or taken by a sound vessel as a mere means of saving time, or from considerations of convenience, the service is classed as towage;….” The Flottbek, 118 F. 954 (9th Cir. Wash. 1902).
Light Boat Handling Training Program
You argue that the Light Boat Handling portion of the training program should not be subject to the provisions of the towing statute because no towing will occur in any of its four modules. In support of your argument, you cite HQ 115048 (Jun. 2, 2000), which states, “CBP has taken the position that in addition to towing and pushing, ‘towing assistance’ is also within the purview of the Towing Statute and ‘covers those instances whereby an assisting vessel is in direct contact with an assisted vessel including (hull to hull, by towline, including if only pre-tethered, or made fast to that vessel by one or more mooring lines) for purposes of exerting force on the assisted vessel to control or assist in controlling the movement of that vessel in US territorial waters.’” (emphasis added). With regard to the Open Water Training, Close Quarters Training, and Emergency Maneuver Training, these modules involve no contact of any sort with another vessel. Accordingly, no towing will occur within the meaning of 46 U.S.C. § 55111 during the foregoing training modules.
With regard to the Incorporation of Headline and Bow Winch Operations module, the trainee must demonstrate proficiency with the training vessel’s bow winch and secure a headline from the training vessel to an HMS barge or tug which will be secured to the dock at an HMS facility. You assert that the vessel to which the headline will be attached will remain stationary at its berth throughout the training exercise. Based on the foregoing, since neither the training vessel or the docked vessel will move, save for unavoidable incidental movement, no voyage would be undertaken. Therefore, no “towage” would occur and the contemplated use of the training vessel during the Headline and Bow Winch Operations module in the Light Boat Handling portion of the training program would not violate the Towing Statute, 46 U.S.C. § 55111.
Assist Training Program
Assist Training will occur in two situations: (l) planned assists; and (2) assists of opportunity. The program of instruction indicates that the training vessel would be “made up to” a barge during the “planned assists” training phase, which indicates that the training vessel would come into direct contact with the barge or other assisted vessel. In the case of assists of opportunity, the other HMS vessels may be engaged on an actual commercial voyage when the training occurs.
As stated above, it is CBP’s position that, in addition to towing and pushing, towing assistance is also within the purview of the Towing Statute and “covers those instances whereby an assisting vessel is in direct contact with an assisted vessel including (hull to hull, by towline, including if only pre-tethered, or made fast to that vessel by one or more mooring lines) for purposes of exerting force on the assisted vessel to control or assist in controlling the movement of that vessel in US territorial waters.” Whether a planned assist or an assist of opportunity is contemplated, the evolutions described in the assist training program indicate that the training vessel will be made up to the assisted vessel to control or assist in controlling the movement of that vessel. For example, Evolution 2 requires:
1. Arrivals, Putting the headline up center lead aft and slowing the ship on approach and running with the ship either to berth or up to the point of the turn. At the point of the berthing or turn, the Training Master will then take over.
2. Running with the inbound ship and putting a line up on the shoulder (No Stem, Stern First Shots) and running with the ship to either the berth or the turn. At the point of the berthing or turn, the Training Master will then take over.
Note**** *If the ship is proceeding straight in, without a turn, and if the Master is comfortable the trainee may attempt the full job putting the ship to berth.
(emphasis added).
Similarly, Evolution 3 requires:
1. Bow Work, turning the ship without running stern first (Master takes over if running stern first is required and the trainee observes, once that part is over and the ship is approaching berth or preparing to give back the line, etc; the trainee may re-engage training at the helm)
2. Stern Work, turning the ship, no shifting to the quarter (Master takes over at the point the shift is required and the trainee observes. Once that part is over and the ship is approaching berth or preparing to give back the line, etc; the trainee may re-engage training at the helm).
(emphasis added).
It is evident that the contemplated use of the training vessel includes exerting force on the assisted vessel to control or assist in controlling the movement of that vessel, as demonstrated by such phrases as “slowing the ship” and “turning the ship.” Accordingly, we are of the opinion that the contemplated use of the training vessel consists of towing as contemplated in 46 U.S.C. § 55111.
You contend, however, that the towing statute is inapplicable to the Assist Training portion of the training program, saying “[c]onceptually, what is occurring is not towing assistance, but training, as the Training Vessel will not be necessary or required for any vessel assist operation that is occurring.” The owners assert that the training vessel will not serve a commercial purpose, displacing another tug, and that the training vessel would not perform a role that would otherwise have been performed by another tug. The sole purpose of the Assist Training portion of the training program is to teach prospective masters and mates how to perform vessel assist functions in a tractor tug. You assert that the HMS vessels with which the training vessel will come into contact during training will be under the control of another, full-sized and operational HMS tug. You admit that, during portions of the Assist Training, the training vessel will be in direct contact with HMS vessels during the applicable training evolutions. You argue, however, that because the role of the training vessel will be solely to provide a training platform for the trainees, the activity undertaken would not constitute “towing” within the meaning of 46 U.S.C. § 55111.
The plain language of 46 U.S.C. § 55111 does not support an interpretation that would allow an exception for coastwise towing by non-coastwise qualified vessels for training purposes. The sole exception set forth in the statute that allows non-coastwise qualified vessel to engage in coastwise towing is when such vessels tow “vessels in distress.” Without any indication in the legislative history that Congress intended to create additional exceptions to 46 U.S.C. § 55111, we do not interpret the statute to include an exception that would allow non-coastwise-qualified vessels to engage in coastwise towing for training purposes. Consistent with the foregoing interpretation Customs Service Decision (C.S.D.) 97-2 (May 12, 1997), CBP held, “[t]owing of tanker vessels by non-qualified vessels for training purposes only would not be permitted if the tows both began and ended in United States territorial waters.”
You argue that the facts of the present matter are distinguishable from those in C.S.D. 97-2, in that the proposed activity involved a non-coastwise-qualified tug performing actual towing services for training purposes. To support your argument, you state that the HMS vessel with which the training vessel will come in contact with will be under the control of another full-sized operational HMS tug. Because the assistance of the training vessel will neither be necessary nor required for the movement or control of the barge nor, in the absence of the training vessel, would another tug be utilized in its stead. As discussed above, much like the plain language of 46 U.S.C. § 55111 does not allow non-coastwise-qualified vessels to engage in towing for training purposes, this statute also does not provide an exception for coastwise towing that is not necessary or not required by the vessel being towed by non-coastwise-qualified vessels. Accordingly, the use of the subject non-coastwise-qualified vessel as a training platform during the Assist Training modules as discussed above would violate 46 U.S.C. § 55111.
In conclusion, the use of the subject non-coastwise-qualified vessel as a training platform would not violate the coastwise passenger statute, 46 U.S.C. § 55103. Similarly, the use of the subject non-coastwise-qualified vessel during the Light Boat Handling portion of the training program, as described in the FACTS section above, would not violate the towing statute, 46 U.S.C. § 55111. However, the use of the subject non-coastwise-qualified vessel as a training platform during the Assist Training modules as discussed above would violate 46 U.S.C. § 55111.
HOLDING
The use of the subject non-coastwise-qualified vessel as a training platform, as described in the FACTS section above, would not violate 46 U.S.C. § 55103.
The use of the training vessel during the Light Boat Handling portion of the training program, as described in the FACTS section above, would not violate the Towing Statute, 46 U.S.C. § 55111. The use of the training vessel in any training scenario or situation in the Assist Training portion of the training program, as described in the FACTS section above, that includes exerting force on an assisted vessel, which moves or is free to move, to control or assist in controlling the movement of that vessel, would constitute towing prohibited under 46 U.S.C. § 55111.
Sincerely,
Lisa L. Burley
Chief /Supervisory Attorney-Advisor
Cargo Security, Carriers and Restricted Merchandise Branch
Office of International Trade, Regulations and Rulings
U.S. Customs and Border Protection