HQ 112298: Coastwise transportation; Fuel oil transshipment; Registry vessel; 46 U.S.C. App. 883; 46 U.S.C. 12105

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 112298


                          July 23, 1992


VES-3-07-CO:R:IT:C 112298  GFM

CATEGORY:  Carriers

Ms. Elizabeth Robertson
Klemm, Blair, Sterling & Johnson, P.C.
Suite 1008, Pacific News Bldg.
238 Archbishop F.C. Flores Street
Agana, Guam 96910

RE:  Coastwise transportation; Fuel oil transshipment; Registry
     vessel; 46 U.S.C. App. 883; 46 U.S.C. 12105


Dear Ms. Robertson:

     Reference is made to your letter of June 17, 1992, in which
you request a ruling as to whether the scenario described below
would constitute a violation of U.S. coastwise laws.

FACTS:

     You state that, on behalf of a client, you wish to know
whether a foreign-flag vessel transporting fuel oil from the U.S.
to Asia which makes a ship-to-ship transfer of a portion of its
cargo to a smaller U.S.-flag ship in international waters for
ultimate delivery to the U.S. territory of Guam would constitute
a violation of the coastwise laws.

ISSUE:

     Whether the combined transportation of merchandise between
the U.S. and Guam aboard a U.S.-flag vessel documented with a
registry endorsement and a foreign-flag vessel would constitute a
violation of the coastwise laws.




LAW AND ANALYSIS:

     The coastwise law pertaining to the transportation of
merchandise, section 27 of the Act of June 5, 1920, as amended
(41 Stat. 999; 46 U.S.C. App. 883, often called the Jones Act),
provides that:

          No merchandise shall be transported by water,
          or by land and water, on a penalty of
          forfeiture of the merchandise (or a monetary
          amount up to the value thereof as determined
          by the Secretary of the Treasury, or the
          actual cost of the transportation, whichever
          is greater, to be recovered from any
          consignor, seller, owner, importer,
          consignee, agent, or other person or persons
          transporting or causing said merchandise to
          be transported), between points in the United
          States...embraced within the coastwise laws,
          either directly or via a foreign port, or for
          any part of the transportation, in any other
          vessel 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...

     For purposes of the coastwise laws, a point in the United
States territorial waters is considered a point embraced within
the coastwise laws.  The territorial waters of the United States
consist of the territorial sea, defined as the belt, three
nautical miles wide, adjacent to the coast of the United States
and seaward of the territorial sea baseline.

     The restrictions enumerated in section 883 has been
liberalized somewhat, however, by the passage of 46 U.S.C. 12105. 
This provision states that vessels which have been issued a
registry may engage in trade with Guam, American Samoa, Wake,
Midway, or Kingman Reef.  Notwithstanding section 12105, however,
in considering the legality of a voyage such as the one
contemplated here, it must be pointed out that, according to
section 883, no portion of the transportation may be carried out
by means of a foreign-flag vessel.  

     Turning to the proposal at hand, it is clear that at least
some of the proposed transportation will take place aboard a
foreign-flag vessel.  In such a case, the use of a coastwise
qualified or registry vessel in conjunction with that foreign-
flag vessel will not be enough to validate the transportation for
the purposes of section 883.


HOLDING:

     The combined transportation aboard a U.S. registry and a
foreign-flag vessel to effect transportation between the U.S. and
Guam constitutes a violation of the coastwise laws.

                                        Sincerely,


                                        
                                        B. James Fritz
                                        Chief