H329275

U.S. Department of Homeland Security Washington, DC 20229 U.S. Customs and Border Protection HQ H329275 April 18, 2023 VES-3-02-OT:RR:BSTC:CCR H329275 HKC CATEGORY: Carriers Peter F. Black, Esq. Mills Black LLP 1215 19th Street, NW Washington, DC 20036 RE: Coastwise Transportation; Outer Continental Shelf; Wind Turbine Generators; 46 U.S.C. § 55102; 19 CFR § 4.80; 43 U.S.C. § 1333. Dear Mr. Black, This letter is in response to your January 4, 2023, ruling request on behalf of your client regarding whether the transportation of wind turbine generator (“WTG”) transition piece covers (“TP covers”) by a non-coastwise-qualified vessel in the waters over the U.S. Outer Continental Shelf (“OCS”), as described below, would violate the coastwise laws. Our decision follows. FACTS The following facts are from your January 4, 2023, ruling request and subsequent correspondence. Your client proposes to install wind turbine generator (“WTG”) units at various installation sites located within a project lease area on the OCS. All WTG installation sites are located outside United States territorial waters on the OCS. The installation will be conducted by [ ], a foreign-flagged, non-coastwise-qualified jack-up WTG installation vessel (“the Jack-up Vessel”). Prior to the Jack-up Vessel’s arrival at each WTG installation site, an unrelated vessel will install a monopile foundation and transition piece at each site. This first vessel will leave a TP cover atop each transition piece before departing the site for the next site. The TP cover is a canvas cover designed to protect the transition piece. The Jack-up Vessel will then proceed from a foreign port to the first WTG installation site, attach itself to the seabed, and jack up to the required installation height. A separate coastwise-qualified tug and barge will arrive from [ ] laden with WTG tower, nacelle, and blade components. At the WTG installation site, the Jack-up vessel will remove the TP cover sitting upon the transition piece and place it upon the deck of the Jack-up Vessel. The Jack-up Vessel will then install the WTG tower, nacelle and blades by lifting them directly from the coastwise-qualified barge to the installation site. Upon completion of the installation at the first WTG site, the Jack-up Vessel will lower itself into the water, disconnect from the seabed, and proceed to the next WTG installation site. You assert that the TP covers should be considered vessel equipment, because they provide protection for the WTG tower segments during the installation process and are necessary for performing the Jack-up Vessel’s function of constructing WTGs. You note that the TP covers will be disassembled and/or damaged by ripping during removal and may attract mold and salt damage during use. You further advise that the TP covers will either be recycled to manufacture new TP covers or disposed of. Your client proposes the following six scenarios regarding the transportation of the TP cover: Scenario One: The Jack-up Vessel offloads the TP cover onto a coastwise-qualified supply vessel prior to lowering itself into the water, detaching from the seabed, and departing the first WTG installation site. The supply vessel transports the TP cover to a U.S. port which would be a coastwise point. Scenario Two: The Jack-up Vessel offloads the TP cover onto a coastwise-qualified supply vessel while it is underway between the first WTG installation site and the second WTG installation site, and not affixed to the seabed. The supply vessel then transports the TP cover to a U.S. port which would be a coastwise point. Scenario Three: While travelling between the first WTG installation site and the second WTG installation site, the Jack-up Vessel attaches itself to a point on the seabed and offloads the TP cover to a coastwise-qualified supply vessel. The Jack-up Vessel then detaches from the seabed and departs for the second WTG installation site. The supply vessel transports the TP cover to a U.S. port which would be a coastwise point. Scenario Four: The Jack-up Vessel travels from the first WTG installation site to the second WTG installation site and affixes itself to the seabed at the second WTG installation site. The Jack-up Vessel then offloads the TP cover onto a coastwise-qualified supply vessel. The supply vessel transports the TP cover to a U.S. port. Scenario Five: TP covers remain on board the Jack-up Vessel as it travels between WTG installation sites, affixing itself to the seabed at each site. The accumulated TP covers are not recycled, but rather disposed of along with operational waste, garbage, and refuse at a U.S. port by the Jack-up Vessel once it completes installation. Scenario Six: The TP covers remain on board the Jack-up Vessel as it travels between WTG installation sites, affixing itself to the seabed at each site. The accumulated TP covers are unloaded only when the Jack-up Vessel returns to a foreign port following the completion of its WTG installation project. ISSUE Whether the proposed transportation of TP covers by a non-coastwise-qualified Jack-up Vessel on the U.S OCS 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. (Emphasis added). Notably, the Jones Act prohibits a non-coastwise-qualified vessel from performing “any part” of the transportation of merchandise between two U.S. points to which the coastwise laws apply, meaning a violation would occur even if the merchandise is transferred to a coastwise-qualified vessel before reaching its destination. Additionally, a Jones Act violation occurs even if the merchandise is carried to a non-coastwise point by a non-coastwise-qualified vessel, prior to being carried to its coastwise destination by a coastwise-qualified vessel. 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. 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 

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.(Emphasis added). Notably, the Jones Act prohibits a non-coastwise-qualified vessel from performing “any part” of the transportation of merchandise between two U.S. points to which the coastwise laws apply, meaning a violation would occur even if the merchandise is transferred to a coastwise-qualified vessel before reaching its destination. Additionally, a Jones Act violation occurs even if the merchandise is carried to a non-coastwise point by a non-coastwise-qualified vessel, prior to being carried to its coastwise destination by a coastwise-qualified vessel.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