Can I use a foreign flag vessel in charter service in U.S. waters?
The following discussion is intended to provide general guidance as to issues that may arise for a particular transaction. Such issues are best considered on an individual case basis. Any foreign vessel entering for navigation between ports in U.S. waters must be imported, requiring payment of an import duty, or must obtain a U.S. Customs cruising permit. The cruising permit does not allow commercial activity while in the U.S., such as charter service. A foreign flag vessel, which has been imported, is restricted from carrying passengers from one U.S. port to another, or from carrying passengers within U.S. waters without a foreign voyage, because it is not eligible for a coastwise trade license. 46 U S.C. 12106. Only U.S. documented vessels are eligible, and vessels which have been foreign built or foreign owned are excluded from this license. 46 U.S.C. 12106(a)(2); 46 C.F.R. 67.17-5(c). Congressional exemptions may be granted to these requirements, on a case by case basis. A foreign
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