Noncontiguous Shipping Relief Act of 2024
The Noncontiguous Shipping Relief Act of 2024 would permit transportation of merchandise in noncontiguous trade using foreign-flag vessels that are “foreign qualified freight vessels” documented under chapter 121, reversing the typical limitation that U.S. coastwise (Jones Act) trade must be carried by U.S.-built, U.S.-owned, U.S.-flag vessels. The bill defines what counts as a foreign qualified freight vessel, expands how these vessels may be used in noncontiguous trade, and adjusts related provisions on vessel registry, citizenship, labor, safety, and environmental standards. In practice, this would create a pathway for foreign-flag ships to move goods between certain U.S. ports in noncontiguous trade, subject to specific documentation and regulatory conditions, while also adjusting various legal and regulatory requirements to accommodate such operations. If enacted, the bill could lower transportation costs for certain shipments and increase flexibility for shippers operating in noncontiguous routes. At the same time, it would raise questions about effects on U.S.-flag mariners, domestic shipbuilding and maintenance, port workforce, and regulatory oversight, as well as potential environmental and labor-law implications. The measure adds new compliance obligations for noncitizens involved in domestic coastwise activity and introduces changes in how foreign-flag vessels are registered, documented, and regulated when used in these trades.
Key Points
- 1Noncontiguous Trade Exemption: Subsection 55102(b) would not apply to transportation in noncontiguous trade of merchandise on a foreign qualified freight vessel that has a valid certificate of documentation issued under chapter 121, enabling foreign-flag ships to participate in these noncontiguous movements.
- 2Definition of Foreign Qualified Freight Vessel and Noncontiguous Trade: A foreign qualified freight vessel is a vessel of at least 1,000 gross tons, not built in the United States (unless rebuilt domestically), registered in a foreign country, and employing U.S. citizens to the extent required of U.S.-registered vessels. Noncontiguous trade is defined as the specific trade defined in Section 53501.
- 3Coastwise Endorsements and Documentation: Coastwise endorsements would be updated to allow foreign qualified freight vessels used for the noncontiguous trade movements to be documented and operate in U.S. ports under a foreign registry when appropriate, with the Secretary of Transportation issuing the necessary documentation.
- 4Transfer of Foreign Registry: The Act allows foreign-qualified freight vessels to be placed under foreign registry without Secretary approval after the vessel is documented, and requires revocation of the U.S. certificate of documentation once foreign registry is chosen.
- 5Labor, Safety, and Environmental Standards: The bill preserves international labor standards for seafarers and allows participation in Longshore and Harbor Workers’ Compensation Act plans with certain conditions. It also requires all vessels in U.S. coastwise trade to meet applicable environmental standards and, when international standards are higher, to apply the stricter standard to U.S.-documented vessels. It introduces liability and jurisdiction changes for injuries to crew on non-U.S.-domiciled employers operating in U.S. ports and adds reporting and accountability provisions for noncitizens irregularly engaging in domestic coastwise trade.