U.S. Customs and Border Protection Decision Seen Opening Jones Act Loopholes

The U.S. Customs and Border Protection has decided to revoke a number of previous letter rulings related to the enforcement of the Jones Act that could result in loopholes with major implications for the U.S. offshore industry.

As gCaptain reported previously, the CBP in October issued a bulletin in which it proposed broadening the definition of “vessel equipment” and removing certain Jones Act requirements from “lifting operations.” While the CPB’s proposed modifications claimed to limit an “overbroad” interpretation of vessel equipment, the proposed language changes and other revisions were viewed as having major implications for various U.S. offshore marine sectors, including creating loopholes that could allow foreign-flagged, non-Jones Act wind turbine installation vessels to operate in the expanding U.S. offshore wind industry.

In a decision bulletin published Thursday, the CBP revealed its intention to move forward with the changes as of February 17, 2020.

“On behalf of thousands of American mariners and shipyard workers, we are disappointed that the U.S. Customs and Border Protection (CBP) has decided to put America second by creating potential loopholes for foreign vessels and crews to unlawfully operate in American waters and take the jobs of American vessels and workers,” said Aaron Smith, President and CEO of the Offshore Marine Services Association.

Earlier this week, a bipartisan group of more than 50 members of Congress sent a letter to DHS Acting Secretary Wolf and White House Chief of Staff Mulvaney reiterating their concerns with the CBP’s overstep of Congress.

“We support the more than 50 bipartisan members of Congress who correctly asserted that only the U.S. Congress can amend the Jones Act,” added Smith. “We will be closely scrutinizing CBP’s implementation of these legally dubious loopholes to ensure that CBP follows the law and requires all foreign-flagged vessels to request and receive letter rulings.  If CBP will not enforce the Jones Act as enacted by Congress, then it is essential they at least provide transparent documentation of the use of these new loopholes.”

The CBP bulletin announcing the changes can be found here (See page 84): https://www.cbp.gov/sites/default/files/assets/documents/2019-Dec/Vol_53_No_45_Title.pdf

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