Noncontiguous Shipping Competition Act
The Noncontiguous Shipping Competition Act would amend the coastwise provisions in title 46 to create a new exemption for noncontiguous trade routes. Under the bill, a route in noncontiguous trade could be exempt from the coastwise laws if three or more separate coastwise-qualified vessel owners/operators regularly operate on that route, each of them transports at least 20% of the goods on that route, and none are under common ownership. If these conditions are met, the route would be exempt from the usual coastwise restrictions; if not, the route remains subject to those laws. The aim is to foster more competition and potentially lower shipping costs for goods moving between the contiguous United States and noncontiguous areas (such as Alaska, Hawaii, Puerto Rico, Guam, etc.) by allowing multiple independent operators to serve the same route. The bill is sponsored by Rep. Case (joined by Rep. Moylan) and introduced January 23, 2025, and referred to the Committee on Transportation and Infrastructure.
Key Points
- 1New exemption mechanism: The bill adds a new paragraph (4) to Section 55101(b) to exempt certain noncontiguous trade from the coastwise laws, provided specific conditions are met.
- 2Three independent operators requirement: There must be at least three owners or operators of coastwise-qualified vessels regularly operating on the route.
- 3Share of volume: Each of those owners/operators must transport at least 20% of the route’s goods.
- 4No common ownership: None of the three (or more) operators may be under common ownership.
- 5Definitions referenced: The exemption applies to routes defined as “noncontiguous trade” (per Section 53501) and to vessels that are “coastwise qualified” (per Section 55108(a)).
- 6Purpose and scope: The bill targets noncontiguous trade routes, aiming to introduce or increase competition among U.S.-flag/coastwise operators serving those routes, while preserving the coastwise framework for routes that do not meet the criteria.