February 27, 2008 CBP Bulletin Notice on Application of Coastwise Laws for Observers of Vessel Operations
In the February 27, 2008 issue of the U.S. Customs and Border Protection Bulletin (Vol. 42, No. 10), CBP published a notice proposing to revoke a ruling and treatment as follows:
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
Proposed revocation of ruling; proposed revocation of treatment. CBP is proposing to revoke a ruling on the application of coastwise laws to certain individuals who are transported between coastwise points for the purpose of observing vessel operations. CBP is also proposing to revoke any treatment it has previously accorded to substantially identical transactions.
CBP states that any party who has received a contrary written ruling or decision on the merchandise that is subject to the proposed ruling revocations, or any party involved with a substantially identical transaction, should advise CBP by March 28, 2008, the date that written comments on the proposed rulings are due. Furthermore, CBP states that an importer's failure to advise CBP of such rulings, decisions, or substantially identical transactions may raise issues of reasonable care on the part of the importer or its agent for importations subsequent to the effective date of the final decision in this notice.
Coastwise passengers aboard foreign vessels. Generally, the coastwise laws prohibit the transportation of passengers or merchandise between points in the U.S. embraced within the coastwise laws in any vessel other than a U.S. flag vessel.
(A person transported on a vessel is considered a passenger unless they are "directly and substantially" connected with the operation, navigation, ownership, or business of that vessel itself.)
In this instance, a company requested that shore side terminal operations managers spend time aboard foreign flag vessels between coastwise points in order to understand what the vessel crew's responsibilities are once the cargo has loaded and is en route to the next port, and to facilitate development of better safety practices and business processes.
CBP is proposing to issue HQ H019524 in order to revoke HQ 004175, which held that the vessel line's shore side employees, specifically, two terminal operations managers, were not passengers within the meaning of 46 USC 55103 and 19 CFR 4.50(b), and therefore, their coastwise transportation was not in violation of 19 USC 55103.
CBP now proposes that observing in order to develop better safety practices and business processes is not directly and substantially related to the operation or business of the vessel itself, and therefore the shore side employees are considered passengers.
CBP states it is proposing this change to conform to prior rulings, and past and current CBP decisions.
proposed: violation of 46 USC 55103; current: no violation of 46 USC 55103
February 28, 2008 CBP Bulletin (Vol. 42, No. 10) available athttp://www.cbp.gov/xp/cgov/toolbox/legal/bulletins_decisions/bulletins_2008/