October 26 - In the USA, four bills are currently pending in Congress to repeal or limit the reach of the Jones Act, including three that are focused upon relief efforts to assist Puerto Rico in the aftermath of Hurricane Maria.
According to a report by Eric Lee and J. Michael Cavanaugh, from international law firm Holland & Knight, the bills include a proposal for the Jones Act to not apply for five years with respect to carriage to and from Puerto Rico (H.R. 3966); a Humanitarian Disaster Relief Act of 2017, which would add humanitarian relief to the criteria for which the US Department of Homeland Security (DHS) could grant waivers (H.R. 3852); and a bill which aims to permanently exempt Puerto Rico from the Jones Act (S. 1894).
In addition to the above bills, the Open America's Waters Act of 2017 (S. 1561), introduced by Senator John McCain earlier this year, has been referred to the Senate Committee on Commerce, Science, (delete this comma) and Transportation, and calls for a general repeal of the act.
None of the bills appears likely to advance immediately, explain Lee and Cavanaugh, but H.R. 3966 and H.R. 3852 could become key elements of broader Puerto Rico reconstruction legislation, if that concept progresses.
The report suggests that many of the same forces that have kept US cabotage laws intact for some 225 years continue to be aligned against any permanent waiver, either globally or locally focused on Puerto Rico.
According to Lee and Cavanaugh, there is potential for a case to be made for a broader temporary waiver for Puerto Rican reconstruction and transport of project cargoes, provided that limitations can be included to offer some protection for existing US-flag services.
H.R. 3966 would create a five-year Jones Act suspension window to aid Puerto Rican reconstruction, while H.R. 3852 would enable DHS to grant Jones Act waivers on a case-by-case basis for Puerto Rico (and other coastwise destinations) on the basis of humanitarian relief efforts.
However, Lee and Cavanaugh explain that for humanitarian relief efforts, the US Maritime Administration (MarAd) would still be required to find an unavailability of US-flagged vessels in order to support such a waiver.
DHS did recently grant a short-term waiver after Hurricane Maria, to allow the use of foreign ships to move aid from the US mainland to Puerto Rico.
However, Holland & Knight questions whether the DHS Jones Act waiver for Puerto Rico was lawful.
Relevant law at 46 US Code Section 501(b) provides that DHS may issue a waiver at the request of the US Department of Defense (DOD) if the latter determines the waiver is required for national defence purposes, explains Holland & Knight.
DHS may issue a waiver on its own, also for national defence purposes, but only if MarAd finds that US-flag vessels are not available. However, in the case of the Puerto Rico waiver, it appears that DHS did not rely on a DOD directive regarding national defence and several media sources reported that MarAd found adequate US-flag ships were available, says Lee and Cavanaugh.