H320052

U.S. Department of Homeland Security Washington, DC 20229 U.S. Customs and Border Protection HQ H320052 May 11, 2022 VES-3-02-OT:RR:BSTC:RRPP H320052 AMW CATEGORY: Carriers Mr. Constantine G. Papavizas, Esq. Winston & Strawn, LLP 1901 L Street, NW Washington DC 20036 RE: Coastwise Transportation; Outer Continental Shelf; Wind Turbines; 46 U.S.C. § 55102; 19 CFR §§ 4.80a and 4.80b; 43 U.S.C. § 1333. Dear Mr. Papavizas: This letter is in response to your August 2, 2021, ruling request and subsequent follow-up information provided on behalf of your client [ ], regarding whether the installation of wind turbine generators by a non-coastwise-qualified vessel on the U.S. outer continental shelf (“OCS”), as described below, would violate the coastwise laws. Our decision follows. FACTS Your client proposes to install approximately [ ] offshore wind turbines in a project developed by [ ] off the coast of [ ] pursuant to a lease issued by the U.S. Bureau of Ocean Energy Management. The project will be outside U.S. territorial waters, but on the OCS [ . The project installation will occur from approximately [ ] to [ ]. You state that wind turbine generator (“WTG”) units will be installed by a non-coastwise-qualified jack-up vessel (the “offshore installation vessel” or “OIV”). The identity of the OIV has not been finalized, but you state that it will likely be the [ ]. You state that the OIV will arrive at the first WTG site without cargo and will be provided WTG components from U.S. ports by coastwise-qualified barges towed by coastwise-qualified tugs; at no time will the foreign OIV go into a U.S. port and lade WTG components. Specifically, the OIV will arrive at the first WTG site, attach itself to the seabed, and jack up to the proper installation height. Following this, a coastwise-qualified tug will position a coastwise-qualified barge alongside the stationary OIV. Once the barge is positioned alongside the OIV, the OIV will utilize its crane to raise and place on its deck the components of a single WTG. In addition to the components themselves, the WTG components will be transported and laden onto the OIV with a series of containers and components (the “devices”) intended to facilitate transport, transfer, and installation, including: a tower lifting tool, tower transport frame, nacelle lifting tool, nacelle transport frame, blade spreader bar, blade rack/stacking frame, and backloading skip. In addition, the OIV will raise up to [ ] shipping containers holding items to be utilized in the WTG installation, including bolts, nuts and grout, spare parts, and provisions for the OIV crew. In addition to this, at the first WTG site, the OIV will receive up to [ ] containers that will remain on board for the duration of the U.S. installation, containing office spaces, tools, rigging equipment, and critical spare parts for the OIV. After the installation of the first WTG, the OIV will jack down and sail to the second WTG installation site. On board will be empty shipping frames and related devices as well as shipping containers that were loaded for the first installation. At the second site, the OIV will again jack up and take on board, utilizing its crane, a second set of WTG components together with their shipping frames/devices and up to [ ] containers. The OIV will also offload the empty shipping frames and containers laded at the previous WTG site back onto the barge, which will transport them back to a U.S. port at which those empty shipping frames and containers will be filled for subsequent installation activities and operation of the OIV. The offloaded containers may also contain refuse and waste related to the operation, including dirty rags, biohazard bags, and wrapping. These operations will be repeated at each of the installation sites. Finally, once all installation operations conclude, the approximately [ ] containers which had been placed on board containing office spaces, tools, rigging, and spare parts also will be returned to a U.S. port either by a coastwise-qualified vessel or the OIV. ISSUES Whether the transportation of the WTG components by a coastwise-qualified tugboat and barge from a U.S. port to an affixed, non-coastwise-qualified jack-up vessel located on the U.S OCS violates the Jones Act, 46 U.S.C. § 55102? Whether the installation of the subject wind turbine generators by the non-coastwise-qualified jack-up vessel on the OCS violates the Jones Act, 46 U.S.C. § 55102? Whether transportation of certain tools and material between coastwise points by the non-coastwise-qualified jack-up vessel violates the Jones Act, 46 U.S.C. § 55102? LAW AND ANALYSIS The coastwise law applicable to the transportation of merchandise, known as the Jones Act, is found at 46 U.S.C. § 55102, and provides in pertinent part: Except as otherwise provided in this chapter or chapter 121 of this title, a vessel may not provide any part of the transportation of merchandise by water, or by land and water, between points in the United States to which the coastwise laws apply, either directly or via a foreign port, unless the vessel— is wholly owned by citizens of the United States for purposes of engaging in the coastwise trade; and has been issued a certificate of documentation with a coastwise endorsement under chapter 121 or is exempt from documentation but would otherwise be eligible for such a certificate and endorsement. 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. 33 CFR § 2.22(a)(2). In addition, Section 4(a)(1) of the Outer Continental Shelf Lands Act of 1953 (“OCSLA”), as amended by The William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021, H.R. 6395, 116th Cong. § 9503 (2021), provides that the Constitution and laws and civil and political jurisdiction of the United States are extended to: the subsoil and seabed of the outer Continental Shelf; all artificial islands on the outer Continental Shelf; installations and other devices permanently or temporarily attached to the seabed, which may be erected thereon for the purpose of exploring for, developing, or producing resources, including non-mineral energy resources; or any such installation or other device (other than a ship or vessel) for the purpose of transporting or transmitting such resources. (emphasis added). Accordingly, the OCSLA, as amended in 2021, extends U.S. jurisdiction to devices attached to the seabed of the OCS for the purpose of producing non-mineral energy such as wind energy. Issue 1: Whether the transportation of the WTG components by a coastwise-qualified tugboat and barge from a U.S. port to an affixed, non-coastwise-qualified jack-up vessel located on the U.S OCS violates the Jones Act, 46 U.S.C. § 55102? As to the whether the transportation of the WTG components between points in the United States and an OIV attached to the U.S. OCS by coastwise-qualified barges and tugs violates 46 U.S.C. § 55102, the Jones Act specifically prohibits the coastwise transportation of “merchandise” between coastwise points by non-coastwise qualified vessels. Pursuant to 46 U.S.C. § 55102(a): “[m]erchandise includes (1) merchandise owned by the United States Government, a State, or a subdivision of a State; and (2) valueless material.” To determine if the proposed transportation occurs between coastwise points, we must examine the points at which the subject merchandise will be laden and unladen. The Jones Act extends to points on 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. 33 CFR § 2.22(a)(2). OCSLA Section 4, as amended by the 2021 NDAA, extends U.S. law to “installations and other devices permanently or

The coastwise law applicable to the transportation of merchandise, known as the Jones Act, is found at 46 U.S.C. § 55102, and provides in pertinent part:Except as otherwise provided in this chapter or chapter 121 of this title, a vessel may not provide any part of the transportation of merchandise by water, or by land and water, between points in the United States to which the coastwise laws apply, either directly or via a foreign port, unless the vessel—is wholly owned by citizens of the United States for purposes of engaging in the coastwise trade; andhas been issued a certificate of documentation with a coastwise endorsement under chapter 121 or is exempt from documentation but would otherwise be eligible for such a certificate and endorsement. 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. 33 CFR § 2.22(a)(2). In addition, Section 4(a)(1) of the Outer Continental Shelf Lands Act of 1953 (“OCSLA”), as amended by The William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021, H.R. 6395, 116th Cong. § 9503 (2021), provides that the Constitution and laws and civil and political jurisdiction of the United States are extended to:the subsoil and seabed of the outer Continental Shelf;all artificial islands on the outer Continental Shelf;installations and other devices permanently or temporarily attached to the seabed, which may be erected thereon for the purpose of exploring for, developing, or producing resources, including non-mineral energy resources; orany such installation or other device (other than a ship or vessel) for the purpose of transporting or transmitting such resources.(emphasis added).Accordingly, the OCSLA, as amended in 2021, extends U.S. jurisdiction to devices attached to the seabed of the OCS for the purpose of producing