April 23, 2008 CBP Bulletin Notice on Application of Coastwise Laws for Observers of Vessel Operations
In the April 23, 2008 issue of the U.S. Customs and Border Protection Bulletin (Vol. 42, No. 18), CBP published a notice revoking a ruling and treatment as follows:
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Revocation of ruling, revocation of treatment.CBP is revoking one ruling on the application of the coastwise laws to certain individuals that are transported between coastwise points for the purpose of observing vessel operations. CBP is also revoking any treatment it has previously accorded to substantially identical transactions.
According to CBP, the revocation is effective June 22, 2008.
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 issuing 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 states 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 makes this change to conform to prior rulings, and past and current CBP decisions.
new: violation of 46 USC 55103; previous: no violation of 46 USC 55103
April 28, 2008 CBP Bulletin (Vol. 42, No. 18) available athttp://www.cbp.gov/xp/cgov/trade/legal/bulletins_decisions/bulletins_2008/