What is the Jones Act?
The Jones Act has been in the news lately, most particularly with calls for waiver of the Act. But what is the Jones Act?
The Jones Act is the common name for the Merchant Marine Act of 1920, codified at 46 USC § 883. It is known as the Jones Act because it was introduced by Senator Wesley Jones. It was enacted by Congress in order to stimulate the shipping industry in the wake of the First World War.
The Act controls coastwise trade within the United States and determines which ships may lawfully engage in that trade and the rules under which they must operate. “Coastwise Trade” applies to a voyage that begins at any point within the United States and delivers commercial cargo to any other point within the United States. Specifically, Section 27 requires that all goods transported by water between ports of the United States be carried on United States flag ships, constructed in the United States, owned by United States citizens and crewed by United States citizens and United States permanent residents.
The Jones Act prevents foreign-flagged ships from carrying cargo between the United States mainland and noncontiguous parts of the United States, such as Puerto Rico, Hawaii, Alaska and Guam. Foreign ships inbound with goods cannot stop at any of these locations, offload goods, load mainland bound goods and continue to the United States mainland ports. Although ships can offload cargo and proceed to the US mainland without picking up any additional cargo intended for delivery to another US location.
The Jones Act also governs the relationship between the employer and the crew aboard a United States vessel.
Requests for waivers of the Act and its provisions are reviewed by the Department of Homeland Security on a case-by-case basis. Historically, waivers have only been granted in cases of national emergencies or upon the request of the Secretary of Defense. Most recently, the Jones Act was suspended in the aftermath of Hurricanes Harvey, Irma and Maria.
There are many supporters of the Jones Act who argue that the Act protects national security, generates tax revenue and assures a reliable domestic transportation service subject to national control and the availability of skilled professionals and modern facilities needed in times of war and national emergency. However, for each supporter of the Act, there is a critic who claims that the Act is a protectionist measure which prohibitively increases shipping costs.