I 

108TH CONGRESS 

1ST SESSION H. R. 2846

To amend the Merchant Marine Act, 1920, to allow transportation of merchandise in Hawaiian noncontiguous trade on foreign-flag vessels, and 

for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 24, 2003

Mr. CASE introduced the following bill; which was referred to the Committee 

on Transportation and Infrastructure, and in addition to the Committee 

on Armed Services, for a period to be subsequently determined by the 

Speaker, in each case for consideration of such provisions as fall within 

the jurisdiction of the committee concerned 

A BILL

To amend the Merchant Marine Act, 1920, to allow transportation of merchandise in Hawaiian noncontiguous trade 

on foreign-flag vessels, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Hawaii Shipping Open 

5 Market Act of 2003’’. 

6 SEC. 2. TRANSPORTATION OF CERTAIN MERCHANDISE.

7 (a) IN GENERAL.—Section 27 of the Merchant Ma8 rine Act, 1929 (46 App. U.S.C. 883) is amended by insert-
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1 ing ‘‘(a) IN GENERAL.—’’ before the first sentence, and 

2 by adding at the end the following: 

3 ‘‘(b) NONCONTIGUOUS TRADE EXEMPTION.—Sub4 section (a) shall not apply with respect to transportation 

5 in Hawaiian noncontiguous trade of merchandise on a for6 eign qualified freight vessel for which the Secretary of 

7 Transportation has issued a certificate of documentation. 

8 ‘‘(c) DEFINITIONS.—In this section: 

9 ‘‘(1) FOREIGN QUALIFIED FREIGHT VESSEL.—

10 The term ‘foreign qualified freight vessel’ means a 

11 freight vessel (as that term is defined in section 

12 2101 of title 46, United States Code) of not less 

13 than 1,000 gross tons that—

14 ‘‘(A) was not built in the United States (or 

15 if rebuilt, not rebuilt in the United States); 

16 ‘‘(B) is registered in a foreign country; and 

17 ‘‘(C) employs United States citizens to the 

18 extent required of vessels registered under sec19 tion 12102 of this title. 

20 ‘‘(2) HAWAIIAN NONCONTIGUOUS TRADE.—The 

21 term ‘Hawaiian noncontiguous trade’ means—

22 ‘‘(A) trade between a point in the contig23 uous 48 States or Alaska and a point in Ha24 waii; or 
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1 ‘‘(B) trade between any point in Hawaii 

2 and any other point in Hawaii.’’. 

3 (b) COASTWISE ENDORSEMENTS.—12106(b) of title 

4 46, United States Code, is amended—

5 (1) by inserting ‘‘(1)’’ after ‘‘(b)’’; 

6 (2) by inserting ‘‘to paragraph (2) and’’ after 

7 ‘‘Subject’’; and 

8 (3) by adding at the end the following: 

9 ‘‘(2)(A) Paragraph (1) shall not apply with respect 

10 to a foreign qualified freight vessel used for transportation 

11 referred to in section 27(b) of the Merchant Marine Act, 

12 1920 (46 App. U.S.C. 883(b)), for which the Secretary 

13 of Transportation has issued a certificate of documenta14 tion. 

15 ‘‘(B) In subparagraph (A) the term ‘foreign qualified 

16 freight vessel’ has the meaning given that term in section 

17 27(c) of the Merchant Marine Act, 1920 (46 App. U.S.C. 

18 883(c)).’’. 

19 (c) FOREIGN TRANSFER.—Section 9(c) of the Ship20 ping Act, 1916 (46 App. U.S.C. 808) is amended by in21 serting ‘‘(1)’’ before the first sentence, and by adding at 

22 the end the following: 

23 ‘‘(2)(A) Notwithstanding paragraph (1), a foreign 

24 qualified freight vessel for which the Secretary has issued 

25 a certificate of documentation after the date of enactment 
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1 of this Act and that is used solely for transportation re2 ferred to in section 27(b) of the Merchant Marine Act, 

3 1920 (46 App. U.S.C. 883(b)) may be placed under for4 eign registry without the approval of the Secretary at any 

5 time after that vessel is issued a certificate of documenta6 tion. At such time as that vessel is placed under foreign 

7 registry, the Secretary shall revoke the certificate of docu8 mentation issued by the Secretary. 

9 ‘‘(B) In subparagraph (A) the term ‘foreign qualified 

10 freight vessel’ has the meaning given that term in section 

11 27(c) of the Merchant Marine Act, 1920 (46 App. U.S.C. 

12 883(c)).’’.

13 SEC. 3. CITIZENSHIP AND TRANSFER PROVISIONS. 

14 (a) CITIZENSHIP OF CORPORATIONS, PARTNERSHIPS, 

15 AND ASSOCIATIONS.—Section 2 of the Shipping Act, 1916 

16 (46 U.S.C. App. 802) is amended by adding at the end 

17 the following: 

18 ‘‘(d)(1) The following provisions of this section shall 

19 not apply to a foreign qualified freight vessel used for 

20 transportation referred to in section 27(b) of the Merchant 

21 Marine Act, 1920 (46 App. U.S.C. 883(b)): 

22 ‘‘(A) The text of subparagraph after ‘possession 

23 thereof’. 

24 ‘‘(B) subsection (c). 
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1 ‘‘(2) In paragraph (1) the term ‘foreign qualified 

2 freight vessel’ has the meaning given that term in section 

3 27(c) of the Merchant Marine Act, 1920 (46 App. U.S.C. 

4 883(c)).’’. 

5 (b) APPROVAL OF TRANSFER OF REGISTRY OR OP6 ERATION UNDER AUTHORITY OF A FOREIGN COUNTRY OR

7 FOR SCRAPPING IN A FOREIGN COUNTRY; PENALTIES.—

8 Section 9 of the Shipping Act, 1916 (46 U.S.C. App. 808) 

9 is amended by adding at the end the following: 

10 ‘‘(e)(1) In lieu of the penalty under subsection (d), 

11 a person that commits an act described in paragraph (2) 

12 in violation of this section is liable to the United States 

13 Government for a civil penalty of not more than $10,000 

14 for each violation. 

15 ‘‘(2) The acts referred to in paragraph (1) are the 

16 following: 

17 ‘‘(A) Charter, sell, or transfer a foreign quali18 fied freight vessel used for transportation referred to 

19 in section 27(b) of the Merchant Marine Act, 1920 

20 (46 App. U.S.C. 883(b)), or interest in or control of 

21 such a vessel.

22 ‘‘(B) Place under foreign registry a foreign 

23 qualified freight vessel used for transportation re24 ferred to in section 27(b) of the Merchant Marine 
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1 Act, 1920 (46 App. U.S.C. 883(b)), that is docu2 mented in the United States. 

3 ‘‘(C) Operate under the authority of a foreign 

4 country a foreign qualified freight vessel used for 

5 transportation referred to in section 27(b) of the 

6 Merchant Marine Act, 1920 (46 App. U.S.C. 

7 883(b)). 

8 ‘‘(f) To promote the transfer of foreign vessels to be 

9 documented under chapter 121 of title 46, United States 

10 Code, for use for transportation referred to in section 

11 27(b) of the Merchant Marine Act, 1920 (46 App. U.S.C. 

12 883(b)), the Secretary may grant approval under sub13 section (c) with respect to such a vessel before the date 

14 the vessel is documented.’’. 

15 ‘‘(g) In subsections (e) and (f), the term ‘foreign 

16 qualified freight vessel’ has the meaning given that term 

17 in section 27(c) of the Merchant Marine Act, 1920 (46 

18 App. U.S.C. 883(c)).’’. 

19 SEC. 4. LABOR PROVISIONS. 

20 (a) LIABILITY FOR INJURY OR DEATH OF MASTER

21 OR CREW MEMBER.—Section 20(a) of the Act of March 

22 4, 1915 (38 Stat. 1185, chapter 153; 46 U.S.C. App. 

23 688(a)), is amended—

24 (1) by inserting ‘‘(1)’’ after ‘‘(a)’’; 
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1 (2) by adding at the end of paragraph (1) (as 

2 designated under paragraph (1) of this subsection) 

3 the following new sentence: ‘‘In an action brought 

4 under this subsection against a defendant employer 

5 that does not reside or maintain an office in the 

6 United States (including any territory or possession 

7 of the United States) and that engages in any enter8 prise that makes use of one or more ports in the 

9 United States (as defined in section 2101 of title 46, 

10 United States Code), jurisdiction shall be under the 

11 district court most proximate to the place of the oc12 currence of the personal injury or death that is the 

13 subject of the action.’’; and 

14 (3) by adding at the end the following new 

15 paragraph: 

16 ‘‘(2)(A) The employer of a master or member of the 

17 crew of a vessel—

18 ‘‘(i) may, at the election of the employer, par19 ticipate in an authorized compensation plan under 

20 the Longshore and Harbor Workers’ Compensation 

21 Act (33 U.S.C. 901 et seq.); and 

22 ‘‘(ii) if the employer makes an election under 

23 clause (i), notwithstanding section 2(3)(G) of the 

24 Longshore and Harbor Workers’ Compensation Act 

25 (33 U.S.C. 902(3)(G)), shall be subject to that Act. 
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1 ‘‘(B) If an employer makes an election, in accordance 

2 with subparagraph (A), to participate in an authorized 

3 compensation plan under the Longshore and Harbor 

4 Workers’ Compensation Act—

5 ‘‘(i) a master or crew member employed by that 

6 employer shall be considered to be an employee for 

7 the purposes of that Act; and

8 ‘‘(ii) the liability of that employer under that 

9 Act to the master or crew member, or to any person 

10 otherwise entitled to recover damages from the em11 ployer based on the injury, disability, or death of the 

12 master or crew member, shall be exclusive and in 

13 lieu of all other liability.’’. 

14 (b) MINIMUM REQUIREMENTS.—All vessels, whether 

15 documented in the United States or not, operating in the 

16 coastwise trade of the United States shall be subject to 

17 minimum international labor standards for seafarers 

18 under international agreements in force for the United 

19 States, as determined by the Secretary of Transportation 

20 on the advice of the Secretaries of Labor and Defense. 

21 SEC. 5. REGULATIONS REGARDING VESSELS. 

22 (a) APPLICABLE MINIMUM REQUIREMENTS.—Except 

23 as provided in subsection (b), the minimum requirements 

24 for vessels engaging in the transportation of cargo or mer25 chandise in the United States coastwise trade shall be the 
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1 recognized international standards in force for the United 

2 States (as determined by the Secretary of the department 

3 in which the Coast Guard is operating, in consultation 

4 with any other official of the Federal Government that the 

5 Secretary determines to be appropriate). 

6 (b) CONSISTENCY IN APPLICATION OF STAND7 ARDS.—In any case in which any minimum requirement 

8 for vessels referred to in subsection (a) establishes a lower 

9 standard than a minimum that is applicable to vessels that 

10 are documented in a foreign country and that are admit11 ted to engage in the transportation of cargo and merchan12 dise in the United States coastwise trade, the standard 

13 applicable to such vessels that are documented in a foreign 

14 country shall be the standard that is applied to United 

15 States documented vessels. 

16 SEC. 6. ENVIRONMENTAL STANDARDS. 

17 All vessels, whether documented under the laws of the 

18 United States or not, engaging in the United States coast19 wise trade shall comply with all applicable United States 

20 and international environmental standards in force for the 

21 United States. 
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1 SEC. 7. REQUIREMENTS FOR CERTAIN NONCITIZENS IR2 REGULARLY ENGAGING IN DOMESTIC COAST3 WISE TRADE. 

4 (a) IN GENERAL.—Each person or entity that is not 

5 a citizen of the United States, as defined in section 

6 2101(3a) of title 46, United States Code, that owns or 

7 operates vessels that irregularly engage in the United 

8 States domestic coastwise trade shall—

9 (1) name an agent upon whom process may be 

10 served; 

11 (2) abide by all applicable laws of the United 

12 States, including applicable environmental and tax 

13 laws; and 

14 (3) post evidence of documentation and en15 dorsements aboard such vessel indicating the owner 

16 or owners of such vessel, including any person con17 trolling vessels and the number of port calls and 

18 coastwise trips made during that calendar year. 

19 (b) PERSONS TREATED AS SINGLE EMPLOYER.—For 

20 purposes of paragraph (3), all persons treated as a single 

21 employer under subsection (a) or (b) of section 52 of the 

22 Internal Revenue Code of 1986 shall be treated as 1 per23 son.

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