U.S. Maritime Industry Stands Behind Jones Act Ruling Letter Changes

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April 18, 2017

File photo: Ocean Installer

The American Maritime Partnership (AMP), representing interests of the domestic maritime industry, has submitted comments strongly in support of the recent U.S. Customs and Border Protection’s (CBP) notice proposing to revoke previous letter rulings inconsistent with the proper enforcement of coastwise laws, including the Jones Act.

The AMP’s comments were submitted on the last day of the open comment period on the CBP’s January 18, 2017 notice published in the Customs Bulletin. The proposal is aimed at restoring certain aspects of the Jones Act by reversing long-standing rulings that have allowed foreign-flagged offshore construction vessels to freely operate on the U.S. Outer Continental Shelf, most notably in the deepwater Gulf of Mexico.

Since CBP first published the notice, the domestic maritime industry and several lawmakers have come out in support of the proposed changes, while ‘big oil’ interests have vehemently opposed the changes.

In its statement Tuesday, the AMP maritime laws advance critical sectors of the domestic economy, create American jobs, and promote national security.

“Correct enforcement of U.S. coastwise laws is vitally important to national security interests and the maintenance of our domestic maritime industry, which sustains nearly 500,000 American jobs and $100 billion in annual economic output,” said Tom Allegretti, Chairman of the American Maritime Partnership. “The U.S. Customs order repealing erroneous coastwise rulings is a wise action that properly enforces U.S. law, promotes the future strength of the domestic fleet and maritime infrastructure, and puts American mariners first. This action will preserve the intent of the Jones Act, a cornerstone of U.S. maritime policy upon which national and economic security depend.”

AMP commended CBP for reviewing prior rulings that were inconsistent with the intent behind coastwise laws, most especially the Jones Act, and urges the lawful implementation of the revocation notice in the interest of national, homeland and economic security. The full comment submitted by the American Maritime Partnership can be found here.

Under the Jones Act, only a vessel that is built in the United States, owned by a U.S. citizen and crewed by U.S. mariners can participate in the transportation of cargo between two points in the United States.

“Proper enforcement of coastwise laws ensures that companies engaging in domestic trade compete equally and are fully subject to U.S. laws and regulation,” the AMP said. “At the expense of economic and national security, previous letter rulings have created an uneven playing field for U.S. companies to compete against foreign-vessels, which are deploying cheap foreign labor, while not paying fair taxes.”

“Beyond safeguarding the competitiveness of the domestic maritime industry, which securely moves nearly one billion tons of cargo annually, the Jones Act strengthens national security through the preservation of a Merchant Marine and the protection of coastal borders and inland waterways,” the AMP added. 

The AMP also noted that the Department of Defense (DoD) and the U.S. Navy both rely on the American commercial maritime industry for military sealift support. As General Darren W. McDew, Commander of U.S. Transportation Command, has said:

“[T]he Jones is part of the overall readiness of our maritime industry and our ability to go to war…. [w]ithout the Jones Act… our maritime industry is in jeopardy, and our ability to project a force is in jeopardy.”

Michael Herbert of CBP’s Jones Act Division of Enforcement (JADE) has echoed this statement, noting the Act’s benefits for border protection, homeland security, and the prevention of illegal immigration.

“Without the Jones Act, we would be inundated with foreign-flag vessels and non-coastwise-qualified vessels doing business at our critical infrastructure. They would have unfettered access to our refineries and more. …Our national security is a layered approach. …There’s no way that we could enforce our national security laws without the Jones Act.”

CBP is accepting comment through April 18, 2017 and will issue a decision within 30-days thereafter. The notice of proposed modification and revocation of letter rulings relating to CBP’s application of the Jones Act can be found in the Customs Bulletin here.

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