Updated: Mar 8
In order to operate a vessel carrying passengers for hire it is necessary to be licensed by the United States Coast Guard. This applies to any form of work such as taking people fishing, diving or any other such activity.
What does "Passenger for hire" mean and what is the definition of "Consideration" which when these definitions are met, the vessel operator needs a license.
"Passenger for hire" means a passenger for whom consideration is contributed as a condition of carriage on the vessel, whether directly or indirectly flowing to the owner, charterer, operator, agent, or any other person having an interest in the vessel.
The determination of what constitutes the carriage of a "passenger for hire" must be made on a case by case basis. This determination is dependent upon the actual operation of a vessel and the flow of consideration as determined by the facts of each case. In general, there needs to be some form of tangible consideration or promise of performance being passed for a "passenger for hire" situation to exist.
"Consideration" means an economic benefit, inducement, right, or profit including pecuniary
payment accruing to an individual, person, or entity, but not including a voluntary sharing of the actual expenses of the voyage, by monetary contribution or donation of fuel, food, beverage, or other supplies.
Additionally, employees or business clients that have not contributed for their carriage, and are carried for morale or entertainment purposes is not included as exchange of consideration.
In summary, if you are a recreational boater you are allowed to share expenses for a day on the water. Just don't make payment mandatory if someone wants a boat ride.