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CBP Gives & CBP Takes Away – For Now

CBP recently issued a ruling, HQ H309672, on July 15th, 2020 relating to wind farm activities (installation of wind turbine generators onto pre-constructed foundations) in the territorial sea off the coasts of Rhode Island and Massachusetts. However, it then swiftly revoked that ruling, HQ H312773, on Aug 3rd, 2020 due to a “lack of clarity” on whether the activities would take place in the US “territorial sea” v. the Outer Continental Shelf (OCS).

(A 2011 ruling in the Deepwater Wind Project confirmed that the use of a crane aboard a non-coastwise-qualified vessel to install wind turbines in the territorial seas was not prohibited by the Jones Act.)
Some background:

The territorial sea is a 3-nautical mile belt, adjacent to the coast; it was extended to 12-nautical miles for international purposes by Presidential Proclamation in Dec 1988 (but did not affect domestic US law). The OCS begins at the 3-mile limit and extends seaward for 200-miles under US law.

CBP takes the position that US coastwise laws were extended by the Outer Continental Shelf Lands Act to installations on the OCS. However, it has not ruled that installation activities on the OCS for an offshore wind farm (e.g. foundations transported to the OCS by a coastwise tug and barge from a US port; then loaded onto a [non-moving] foreign owned jack-up vessel for installation [via its own cranes] onto the ocean floor i.e. seabed) constitutes a coastwise point under the Jones Act.

Conclusions & Recommendation

Revocation of the July 15th, 2020 Ruling does not change anything. Ultimately, we believe CBP will apply the same territorial sea rationale (US coastwise point) to the OCS, and consider that it applies with equal force to an offshore wind farm on the OCS, which is thereby subject to the Jones Act.

Therefore, before proceeding with any offshore wind farm project on the OCS, a request to CBP for a ruling would be critical.
Watch this space.