MaritimeFedWatch

On December 19, 2024, the “Shipbuilding and Harbor Infrastructure for Prosperity and Security for America Act of 2024,” to be known as the “SHIPS for America Act of 2024,” was introduced in the U.S. Congress.  The legislation is an ambitious effort to increase substantially the U.S. merchant marine in the international trade and the U.S. shipyard industrial base after a long period of U.S. government neglect. 

In the aftermath of the tragic destruction and disruptions of hurricanes there are usually some calls to “waive the Jones Act.”  Putting aside whether such a waiver can ever be efficacious, it might be useful to review how very narrow the circumstances must be to justify such a waiver under the law as it has been amended.

The U.S. Department of Justice recently made available the Settlement Agreement in the case involving the transportation of frozen fish from Alaska to New England via Canada allegedly in violation of the Jones Act. The Settlement Agreement was provided in response to a Freedom of Information Act request. It was not included in the case docket when the Stipulation for Dismissal was submitted to the U.S. District Court for the District of Alaska in February 2024.

U.S. Customs and Border Protection confirmed on August 21, 2024 its Jones Act interpretations relating to the installation of foundations for an offshore wind project which it issued last year. 

The United States restricts its domestic maritime trade, including its fisheries, to defined “United States citizens.”  Although maritime citizenship law is rigorous, it permits certain foreign investment provided vessels remain under U.S. citizen control.

The United States reserves its domestic maritime trade to vessels “built in the United States” under a set of laws popularly referred to as the “Jones Act.” What qualifies as “U.S. built” under the law and U.S. Coast Guard interpretations was recently tested in the U.S. Court of Appeals for the Fifth Circuit case of Diamond Services Corp. v. Curtin Maritime Corp.

U.S. Customs and Border Protection recently issued three rulings on multiple facets of the transportation by water of liquified natural gas. All three rulings addressed how the U.S. Jones Act, which is a set of U.S. laws restricting U.S. domestic maritime commerce to qualified U.S.-flag vessels, applies to LNG transportation.

On December 14, 2023, the U.S. Maritime Administration issued a Final Rule which makes its “Federal Ship Financing Program,” widely known as “Title XI,” more flexible.

On October 16, 2023, Judge Kenneth M. Hoyt of the U.S. District Court for the Southern District of Texas (Houston Division) granted the intervenor-defendant American Petroleum Institute’s (API) motion for summary judgment in the case of Great Lakes Dredge & Dock Company, LLC v. Chris Magnus (Civil Action No. 4:22-CV-02481).

The U.S. Congress has been actively considering legislation since 2022 that would restrict the use of foreign vessels in U.S. offshore projects. Both oil and gas and renewable energy projects would be affected. The latest version of that legislation was introduced on October 5, 2023, by Senator Bill Cassidy (R-LA) entitled the “American Worker Fairness Act.”

U.S. Customs and Border Protection modified earlier Jones Act guidance on the installation of foundations for offshore wind turbines on September 14. The “Jones Act” is a popular term for several laws which reserve U.S. domestic maritime trade to U.S.-flag vessels which must be built in the United States and be owned and operated by qualified U.S. citizens.

U.S. Customs and Border Protection recently issued rulings which continue to provide guidance on the application of the Jones Act to the installation of offshore wind turbines. The “Jones Act” is a popular term for several laws which reserve U.S. domestic maritime trade to U.S.-flag vessels which must be built in the United States and be owned and operated by qualified U.S. citizens. 

On April 26, 2023, the U.S. House Transportation and Infrastructure Committee reported favorably H.R. 2741, the Coast Guard Authorization Act of 2023, including the two provisions which will have an effect on the ability of the United States to produce both oil and gas resources offshore and renewable energy offshore.

The National Defense Authorization Act for Fiscal Year 2023 sent to President Biden for his signature on December 16, 2022 contains a major expansion of the Capital Construction Fund vessel tax deferral program designed to help finance the construction of vessels in the United States.

U.S. Customs and Border Protection in a September 2, 2022 ruling narrowed the scope of what a foreign cable lay vessel can lawfully do on U.S. offshore wind projects. CBP partially altered its views on October 28 with regard to the transportation of cable remaining after a cable lay operation is complete.

An amendment was recently offered by Sen. Bill Cassidy (R-LA) to the pending National Defense Authorization Act legislation which would substantially change the way the U.S. Government provides Jones Act compliance guidance.

U.S. Customs and Border Protection clarified further the permissible foreign vessel scope of work for offshore wind cable installation in rulings issued on June 30, 2022 and September 2, 2022. In two instances – installation of cable protection and transportation of excess cable – CBP has narrowed permissive prior rulings.

On July 27 Senator Joe Manchin (D-WV) and Senate Majority Leader Chuck Schumer (D-NY) announced wide-ranging legislation entitled the “Inflation Reduction Act of 2022” that would make substantial changes to U.S. federal tax policy. Included in the proposed legislation are historic renewable energy tax incentives including an incentive to manufacture “wind energy components” in the United States such as “related offshore wind vessels.”

The Biden Administration announced today a new federal-state offshore wind partnership to spur the installation of electricity generating wind turbines off the U.S. coast.

U.S. Customs and Border Protection just made public two rulings dated May 11 and June 6 which further fill in the picture of what foreign vessels can lawfully do in the U.S. offshore wind industry.