HQ 113032: Coastwise trade; Indirect shipment; Shipping to Hawaii; 46 U.S.C. App. 883; Third proviso

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.

                           July 8, 1994





                            HQ 113032




VES-3-CO:R:IT:C  113032 LLB

CATEGORY: Carriers

Mr. Bill Thayer
President and General Manager
Waldron Steamship Company, Ltd.
Pier One Control Tower
Honolulu, Hawaii 96813

RE:  Coastwise trade; Indirect shipment; Shipping to Hawaii; 46
     U.S.C. App. 883; Third proviso

Dear Mr. Thayer:

     Reference is made to your request for a ruling on the
legality of moving cargo from the mainland United States to
Hawaii, through a location in Canada.  

FACTS:

     It is proposed that steel of United States origin be shipped
by either truck or rail to the port of Vancouver, British
Columbia, Canada.  The steel would then be placed aboard a
foreign-flag vessel together with merchandise originating at that
port.  The vessel would then proceed to Hawaii where all cargo
would be discharged.

ISSUE:

     Whether merchandise transported by either truck or rail from
a point in the United States to Vancouver, British Columbia,
Canada, may then be placed aboard a foreign-flag vessel for
transportation to and discharge in Hawaii without violating the
provisions of the coastwise merchandise transportation statute.

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:


                              - 2 -


          No merchandise shall be transported by water,
          or by land and water, on 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 trans-
          portation, whichever is greater, to be recovered
          from any consignor, seller, owner, importer,
          consignee, agent, or other person or persons
          so 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... 

     Under the plain terms of the statute,the proposed
transportation would be a violative indirect transportation via
foreign territory.  The proposed transportation would not be
covered within the terms of the so-called third proviso to
section 883.  That proviso would permit transportation of the
type described if the United States points involved were either
in the continental United States or Alaska, but not Hawaii.

HOLDING:

     Merchandise may not be transported in part by a foreign-flag
vessel between a point in the continental United States and
Hawaii, via a port of lading in Hawaii.  Such a movement would be
in violation of 46 U.S.C. App. 883.

                                  Sincerely,




                                  Arthur P. Schifflin
                                  Chief
                                  Carrier Rulings Branch