Legal Definitions - coastwise trade

Coastwise trade, also commonly referred to as coasting trade, describes the transportation of goods or passengers by water between two points located within the same country. This type of trade typically occurs along a nation's coastlines, rivers, or inland waterways, rather than involving international routes. Many countries implement specific regulations, often called cabotage laws, to restrict coastwise trade to vessels that are built, owned, and operated by their own citizens or companies. These laws are designed to protect domestic shipping industries, ensure national security, and maintain a skilled maritime workforce.

• Example 1: Domestic Cargo Shipment

  A shipping company uses a U.S.-flagged cargo vessel to transport a large consignment of manufactured goods from a port in Houston, Texas, to a port in Miami, Florida. The vessel sails along the Gulf Coast and around the Florida peninsula.

  This illustrates coastwise trade because the goods are moved by water between two distinct points (Houston and Miami) that are both located within the United States, utilizing its domestic waterways.

• Example 2: Inter-Island Passenger Ferry

  A ferry service operates daily, carrying passengers and vehicles between the North Island and the South Island of New Zealand. The ferry departs from Wellington and arrives in Picton, traversing the Cook Strait.

  This is an example of coastwise trade as it involves the waterborne transportation of passengers and their vehicles between two locations (Wellington and Picton) that are both within New Zealand's national borders.

• Example 3: Bulk Commodity Transport

  A Canadian-registered bulk carrier transports a shipment of iron ore from a mining port on the coast of Labrador to a steel mill located in Hamilton, Ontario, via the St. Lawrence Seaway and the Great Lakes.

  This demonstrates coastwise trade because the iron ore is transported by water from one point to another entirely within Canada's national jurisdiction, utilizing its internal and coastal waterways.