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[Senate Report 107-48]
[From the U.S. Government Publishing Office]

                                                       Calendar No. 107
107th Congress                                                   Report
                                 SENATE
 1st Session                                                     107-48

======================================================================

 
                MARITIME POLICY IMPROVEMENT ACT OF 2001
                                _______
                                

                 July 27, 2001.--Ordered to be printed

                                _______
                                

      Mr. Hollings, from the Committee on Commerce, Science, and 
                Transportation, submitted the following

                              R E P O R T

                        [To accompany H.R. 1098]

  The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (H.R. 1098) to improve the 
recording and discharging of maritime liens and expand the 
American Merchant Marine Memorial Wall of Honor, and for other 
purposes, having considered the same, reports favorably thereon 
without amendment and recommends that the bill do pass.

                          Purpose of the Bill

  The purpose of the bill is to: expand the American Merchant 
Marine Memorial Wall of Honor; clarify the regulation of 
agriculture residue from hold washings; improve the recording 
and discharging of maritime liens; clarify the measurement of 
the research vessel DAVIDSON; grant waivers to a number of 
vessels with regards to operations in the coastwise trade; and, 
allow the owner of the vessel ASPHALT COMMANDER to place the 
vessel under foreign registry.

                          Background and Needs

  The bill is comprised of several smaller pieces of 
legislation that were not acted upon during the last Congress 
along with a number of new provisions that were developed 
during the conference negotiations on the Coast Guard 
Authorization Act of 2000, but were not enacted. Further 
explanation of the background and needs of each provision is 
contained in the summary of major provisions below.

                      Summary of Major Provisions

  The bill is comprised of several smaller pieces of 
legislation that were not acted upon during the last Congress 
along with several new provisions. The following provides a 
brief background and analysis of the major sections of the 
bill:
  Section 3 of the bill amends section 1120(g) of the Coast 
Guard Authorization Act of 1996 (Public Law 104-324) to add the 
vessel COASTAL VENTURE to a list of vessels deemed to have been 
constructed in the United States for the limited purpose of the 
Merchant Marine Act of 1936. The company which owns the COASTAL 
VENTURE obtained this foreign-built vessel and its coastwise 
trading privileges through a government forfeiture sale. The 
Department of Commerce later determined that even though this 
foreign-built vessel is considered a U.S. vessel under U.S. 
coastwise trading laws, it cannot participate in its company's 
Capital Construction Fund Agreement with the U.S. Government. 
This section would allow funds generated by the COASTAL VENTURE 
to be deposited in its owner's Capital Construction Fund 
account. These funds must subsequently be spent in a U.S. 
shipyard.
  Section 4 adopts the American Merchant Marine Memorial Wall 
of Honor Expansion Act which was introduced during the last 
Congress in the House, but not acted upon. It would authorize 
the Secretary of Transportation to make grants to the American 
Merchant Marine Veterans Memorial Committee to construct an 
addition to the American Merchant Marine Memorial Wall of Honor 
in San Pedro, California.
  Section 5 reaffirms Congressional intent to govern the 
discharge of any agricultural cargo residue material from a 
vessel in the form of hold washings exclusively under the 
provisions of MARPOL Annex V (MARPOL V) as implemented by the 
Act to Prevent Pollution from Ships (APFS) (33 U.S.C. Sec.  
1901, et seq.). Agricultural cargo residue material refers to 
materials such as corn, wheat, rice, soybeans, grams, and other 
agricultural material and their residues routinely carried on 
vessels. Last year, the Coast Guard announced a plan to change 
its enforcement policy to apply other laws to regulate the 
discharge of agriculture cargo residue material that has 
traditionally been governed by MARPOL V. This proposed policy 
change would place an unwarranted burden on U.S.-flag bulk 
grain vessels which are required by agricultural inspection 
rules to wash their cargo holds at sea while underway en route 
to the next loading port. This discharge of agricultural cargo 
residue material is consistent with MARPOL V which specifically 
contemplates the discharge of such cargo residue.
  Section 6 of the bill provides equal treatment for all 
vessels documented under the laws of the United States in 
matters regarding the recording and discharging of liens. Under 
the current section 31343 of title 46, United States Code, any 
person with a valid lien against the title of a vessel with a 
preferred mortgage may file the notice of claim of lien with 
the Secretary of Transportation. The Secretary is then required 
to record the lien filing providing notice to any subsequent 
creditor of the existence of the claim of lien. This process 
provides the necessary transparency to all potential 
creditors,buyers, and owners of the vessel to make informed commercial 
decisions regarding a particular vessel.
  However, under current law, if a vessel is not covered by a 
preferred mortgage, the Secretary has no authority to record 
the notice of claim of lien. This legislation would extend the 
provisions of current law for preferred mortgages to a person 
with a valid lien against a vessel not covered by a preferred 
mortgage.
  This provision is not intended to change any provision of 
current law related to preferences given to any type of lien. 
All aspects of admiralty law, including any relevant case law 
applicable to chapter 313 of title 46, apply to this provision. 
This provision is not intended to affect the rights of any 
party in a bankruptcy proceeding.
  The provision is designed to make maritime liens as 
transparent as possible and to provide as much notice as 
possible to existing and potential creditors. If not renewed, 
notice of maritime liens recorded under this section will 
expire after three years. The expiration provision reduces the 
administrative burden on the Coast Guard in determining which 
liens remain in effect at any given time.
  The effective date of this section is delayed until July 1, 
2002, in order to give all of the parties adequate time to 
become familiar with these changes and to allow the Coast Guard 
to change their regulations to reflect these changes. The Coast 
Guard may immediately prescribe regulations to reflect the 
change in law concerning the new authority to record notice of 
claim of lien on documented vessels that do not have a 
preferred mortgage.
  Section 7 of the bill deems the research vessel DAVIDSON to 
be less than 100 gross tons, as measured under chapter 145 of 
title 46, United States Code, for purposes of applying the 
optional regulatory measurement under section 14305 of title 
46. The optional measurement provision allows the vessel owner 
to select any method to tonnage measurement prescribed under 
chapter 145 of title 46. Currently, chapter 145 allows tonnage 
to be measured pursuant to the International Convention of 
Tonnage Measurement of Ships, 1969, and alternate tonnage, if 
prescribed by section 14104(b) of title 46. While the United 
States Coast Guard has implemented some regulations detailing 
alternate tonnage measurement for certain classes of vessels, 
they have not completed full regulations on all classes of 
vessels.
  The DAVIDSON is a former National Oceanographic and 
Atmospheric Administration research vessel. This section will 
allow the vessel to be used as part of an advanced marine 
sciences technical training program developed by the vessel's 
owners in conjunction with higher education and training 
institutions in the Pacific Northwest and Alaska.
  Sections 8, 10, and 11 of the bill grants coastwise waivers 
for the operation (and in some cases, the restricted operation) 
of otherwise not qualified vessels in the coastwise trade. 
Subject to certain limited exceptions, the provisions of law 
known as the Jones Act (Section 27 of the Merchant Marine Act, 
1920) and sections 12106-12108 of title 46, U.S. Code, provide 
that only those vessels built in the United States and 
continuously owned by U.S. citizens and documented in the U.S. 
may transport merchandise or passengers in the coastwise trade 
or engage in the domestic fisheries of the United States. The 
Jones Act was amended during the 104th Congress to waive the 
requirement that a vessel be continuously owned by U.S. 
citizens and documented in the U.S. for small passenger vessels 
or uninspected passenger vessels authorized to carry no more 
than 12 passengers for hire. Where the facts applicable to a 
particular vessel suggest that the U.S.-built, U.S.-documented, 
or U.S.-owned requirements have not been satisfied, the Coast 
Guard may not issue a document permitting coastwise trading or 
domestic fishing privileges for such vessel unless the 
requirements of the law are statutorily waived.
  Section 9 of the bill adds the vessels SS RED OAK VICTORY and 
SS AMERICAN VICTORY to a list of three other vessels subject to 
section 3302(l) of title 46, United States Code. The Secretary 
of Transportation may issue a permit exempting any of these 
vessels from the inspection requirements for passenger vessels 
so long as the vessels are owned by nonprofit organizations and 
operated as nonprofit memorials to merchant mariners. Most of 
these vessels do not meet the physical requirements for vessel 
safety, because they were built during World War II when 
inspection requirements were different. The Coast Guard will 
still be authorized to regulate safety.
  Section 12 of the bill allows vessels participating in the 
New World Challenge to carry passengers in domestic waters as 
part of the promotional activities associated with the race. 
The race is being organized by Challenge Business International 
and will start and conclude in San Francisco. Organizers hope 
to allow press, corporate sponsors and their guests the 
opportunity to sail on the vessels. However, the Passenger 
Services Vessel Act prohibits foreign-built vessels from 
transporting passengers in the domestic trade. This provision 
would permit the vessels involved in the race to transport 
passengers for up to 60 days after the end of the race.
  Section 13 of the bill allows the owner of the vessel ASPHALT 
COMMANDER to place this U.S.-flag vessel under a foreign 
registry. The ASPHALT COMMANDER is an older single hull tanker 
designed and built for the Military Sealift Command (MSC). 
After the vessel was no longer needed by the MSC, the U.S. 
Maritime Administration (MARAD) foreclosed and took possession 
of the vessel. The current U.S. owner purchased the vessel from 
MARAD and converted it into an asphalt carrier. Due to the 
vessel's design and small cargo capacity, the owner is no 
longer able to economically operate the vessel as a U.S.-flag 
vessel.

                          Legislative History

  The bill was introduced in the House of Representatives by 
Mr. Young of Alaska on March 20, 2001, and referred to the 
House Committee on Transportation and Infrastructure. The bill 
was not considered by the Committee but was passed by the House 
under suspension of the rules by a vote of 415-3 (Roll Call no. 
55) on March 21, 2001. On March 22, 2001, the bill was received 
in the Senate and read twice and referred to the Committee on 
Commerce, Science, and Transportation. The Committee reported 
H.R. 1098 without amendment favorably on May 3, 2001.

                            Estimated Costs

  In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 11, 2001.
Hon. John McCain,
Chairman, Committee on Commerce, Science, and Transportation, U.S. 
        Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1098, the Maritime 
Policy Improvement Act of 2001.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts for this 
estimate are Deborah Reis (for federal spending), and Carolyn 
Lynch (for revenues).
            Sincerely,
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director).
    Enclosure.

H.R. 1098--Maritime Policy Improvement Act of 2001

    H.R. 1098 would authorize appropriations for a merchant 
marine memorial and would modify the regulatory status of 
certain vessels. Assuming appropriation of the specified 
amounts, CBO estimates that implementing this bill would cost 
$500,000 in fiscal year 2002. Provisions regarding the 
designation of the vessel COASTAL VENTURE could result in a 
reduction in federal tax revenues, but we estimate that any 
such reduction would be negligible. Because the bill would 
affect receipts, pay-as-you-go procedures would apply.
    H.R. 1098 would authorize the appropriation of $500,000 for 
2002 to the Secretary of Transportation to make matching grants 
to the American Merchant Marine Veterans Memorial Committee, 
Inc. The committee would use the grants to construct an 
addition to the American Merchant Marine Memorial Wall of Honor 
in San Pedro, California. Assuming appropriation of the 
authorized amount, CBO estimates that the Department of 
Transportation's Maritime Administration would spend $500,000 
in fiscal year 2002 to provide the matching grant to the 
committee.
    Section 3 would deem the vessel COASTAL VENTURE to be a 
U.S. flagship qualified for employment in coastal trade, 
enabling its owner to establish a capital construction account 
for the purposes of constructing, acquiring, leasing, or paying 
off the indebtedness of the ship. Because such deposits and 
their earnings are tax-deferred and withdrawals of these funds 
are tax-exempt if used for qualifying purposes, corporate 
income tax revenues could be affected. As a result, pay-as-you 
go procedures would apply. Given the historical use of these 
accounts and the addition of only one vessel, CBO estimates 
that this provision would have a negligible effect on revenues.
    Other provisions of H.R. 1098 would have no effect on the 
federal budget. Most of these provisions would allow certain 
ships to receive certificates of documentation or waivers from 
various federal regulations.
    H.R. 1098 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on state, local, or tribal governments. 
The act would authorize the appropriation of $500,000 in fiscal 
year 2002 for a grant to construct an addition to the American 
Merchant Marine Wall of Honor. The federal share of the project 
would be 50 percent; any cost incurred by state or local 
governments for the project would be voluntary.
    The CBO staff contacts for this estimate are Deborah Reis 
(for federal spending), and Carolyn Lynch (for revenues). The 
estimate was approved by Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                      Regulatory Impact Statement

  In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported:

                       NUMBER OF PERSONS COVERED

  The number of persons covered should be consistent with 
current levels.

                            ECONOMIC IMPACT

  The bill does not create any new programs, the legislation 
should have no additional economic impact.

                                PRIVACY

  The bill as reported would have no adverse impact on the 
personal privacy of individuals.

                               PAPERWORK

  There should be minimal change to paperwork requirements as a 
result of the bill. Under Section 6, the Coast Guard Vessel 
Documentation Center would be responsible for receiving, 
recording, and discharging an increased number of vessels 
liens. It is impossible to accurately forecast the full impact 
on the center, as no data is available on the number of 
recordable liens. However, it is believed that the increase in 
paperwork will be negligible.

                      Section-by-Section Analysis

Section 1. Short title

  This section states that the Act may be cited as the Maritime 
Policy Improvement Act of 2001.

Section 2. Table of contents

  Defines the contents of the bill.

Section 3. Vessel COASTAL VENTURE

  Section 3 of the bill amends section 1120(g) of the Coast 
Guard Authorization Act of 1996 (Public Law 104-324) to add the 
vessel COASTAL VENTURE to a list of vessels, deemed to have 
been constructed in the United States for the limited purpose 
of the Merchant Marine Act of 1936.

Section 4. Expansion of American Merchant Marine Memorial Wall of Honor

  Section 4 of the bill authorizes the Secretary of 
Transportation to make grants to the American Merchant Marine 
Veterans MemorialCommittee to construct an addition to the 
American Merchant Marine Memorial Wall of Honor in San Pedro, 
California.

Section 5. Discharge of agricultural cargo residue

  Section 5 of the bill requires the discharge from a vessel of 
any agricultural cargo residue material in the form of hold 
washings to be governed exclusively under the provisions of 
MARPOL Annex V (MARPOL V) as implemented by the Act to Prevent 
Pollution from Ships (APPS). Agricultural cargo residue 
material refers to materials such as corn, wheat, rice, 
soybeans, grains, and other agricultural material and their 
residues routinely carried on vessels.

Section 6. Recording and discharging maritime liens

  Under current law, if a vessel is not covered by a preferred 
mortgage, the Secretary has no authority to record the notice 
of claim of lien. Section 6 of this bill would extend the 
provisions of current law for preferred mortgages to a valid 
lien against a vessel not covered by a preferred mortgage.
  This provision is not intended to change any provision of 
current law related to preferences given to any type of lien. 
All aspects of admiralty law, including any relevant case law 
applicable to chapter 313 of title 46, United States Code, 
apply to this provision. This provision is not intended to 
affect the rights of any party in a bankruptcy proceeding.
  The effective date of this section is delayed until July 1, 
2002, in order to give the public adequate time to become 
familiar with these changes and to allow the Coast Guard to 
change their regulations to reflect these changes.

Section 7. Tonnage of R/V DAVIDSON

  Section 7 of the bill deems the research vessel DAVIDSON to 
be less than 100 gross tons, as measured under chapter 145 of 
title 46, United States Code, for purposes of applying the 
optional regulatory measurement under section 14305 of title 
46. The DAVIDSON is a former National Oceanographic and 
Atmospheric Administration research vessel. This section will 
allow the vessel to be used as part of an advanced marine 
sciences technical training program developed by the vessel's 
owners in conjunction with higher education and training 
institutions in the Pacific Northwest and Alaska.

Section 8. Miscellaneous certificates of documentation

  Section 8 of the bill waives certain coastwise trade laws for 
20 individually listed vessels.

Section 9. Exemption for victory ships

  Section 9 of the bill adds the vessels SS RED OAK VICTORY and 
SS AMERICAN VICTORY to a list of three vessels subject to 
section 3302(l) of title 46, United States Code. The Secretary 
of Transportation may issue a permit exempting any of these 
vessels from the inspection requirements for passenger vessels 
so long as the vessels are owned by nonprofit organizations and 
operated as nonprofit memorials to merchant mariners.

Section 10. Certificates of documentation for 3 barges

  Section 10 of the bill waives the coastwise trade laws of the 
United States for three barges as long as these barges are only 
used in firework displays.

Section 11. Certificate of documentation for the EAGLE

  Section 11 of the bill waives certain U.S. coastwise trade 
laws for the vessel EAGLE for specific purposes.

Section 12. Waiver for vessels in New World Challenge Race

  Section 12 of the bill allows ten sailboats participating in 
the New World Challenge Race to transport non-paying guests, 
from and around the ports of San Francisco and San Diego, 
California, before and during stops of that race. The section 
expires on either December 31, 2003, or 60 days after the last 
competing sailboat reaches the end of that race in San 
Francisco, whichever is earliest. For the purpose of this 
section, the term ``guests'' is defined to include corporate 
sponsors, their employees and guests, members of the media and 
press, and any other supporter of the race.

Section 13. Vessel ASPHALT COMMANDER

  Section 13 of the bill allows the owner of the vessel ASPHALT 
COMMANDER to place this U.S.-flag vessel under a foreign 
registry. The ASPHALT COMMANDER is an older single hull tanker 
designed and built for the Military Sealift Command (MSC). 
After the vessel was no longer needed by the MSC, the U.S. 
Maritime Administration (MARAD) foreclosed and took possession 
of the vessel. The current U.S. owner purchased the vessel from 
MARAD and converted it into an asphalt carrier. Due to the 
vessel's design and small cargo capacity, the owner is no 
longer able to economically operate the vessel as a U.S.-flag 
vessel.

                        Changes in Existing Law

  In compliance with paragraph 12 of rule XXVI of the Standing 
Rules of the Senate, changes in existing law made by the bill, 
as reported, are shown as follows (existing law proposed to be 
omitted is enclosed in black brackets, new material is printed 
in italic, existing law in which no change is proposed is shown 
in roman):

                 Coast Guard Authorization Act of 1996

SEC. 1120. DOCUMENTATION OF CERTAIN VESSELS.

  (a) General Certificates.--Notwithstanding sections 12106, 
12107, and 12108 of title 46, United States Code, section 8 of 
the Act of June 19, 1886 (24 Stat. 81; chapter 421; 46 App. 
U.S.C. 289), and section 27 of the Merchant Marine Act, 1920 
(46 App. U.S.C. 883), as applicable on the date of enactment of 
this Act, the Secretary of Transportation may issue a 
certificate of documentation with appropriate endorsement for 
employment in the coastwise trade for the following vessels:
          (1) ABORIGINAL (United States official number 
        942118).
          (2) ALPHA TANGO (United States official number 
        945782).
          (3) ANNAPOLIS (United States official number 999008).
          (4) ARK (United States official number 912726).
          (5) AURA (United States official number 1027807).
          (6) BABS (United States official number 1030028).
          (7) BAGGER (State of Hawaii registration number 
        HA1809E).
          (8) BAREFOOT'N (United States official number 
        619766).
          (9) BARGE 76 (United States official number 1030612).
          (10) BARGE 77 (United States official number 
        1030613).
          (11) BARGE 78 (United States official number 
        1030614).
          (12) BARGE 100 (United States official number 
        1030615).
          (13) BEACON (United States official number 501539).
          (14) BEAR (United States official number 695002).
          (15) BEULA LEE (United States official number 
        928211).
          (16) BEWILDERED (United States official number 
        902354).
          (17) BIG DAD (United States official number 565022).
          (18) BILLY BUCK (United States official number 
        939064).
          (19) BROKEN PROMISE (United States official number 
        904435).
          (20) CAPTAIN DARYL (United States official number 
        580125).
          (21) CAROLYN (State of Tennessee registration number 
        TN1765C).
          (22) CHARLOTTE (State of Maryland certification 
        number MD1397AM).
          (23) CHESAPEAKE (United States official number 
        999010).
          (24) CHRISSY (State of Maine registration 
        certification number ME4778B).
          (25) COLT INTERNATIONAL (United States official 
        number 913637).
          (26) CONSORT (United States official number 999005).
          (27) CONSORTIUM (British registration number 303328).
          (28) COURIER SERVICE (Vanuatu registration number 
        688).
          (29) CURTIS BAY (United States official number 
        999007).
          (30) DAMN YANKEE (United States official number 
        263611).
          (31) DANTE (United States official number 556188).
          (32) DELTA KING (United States official number 
        225874).
          (33) DORDY III (United States official number 
        286553).
          (34) DRAGONESSA (United States official number 
        646512).
          (35) EAGLE MAR (United States official number 
        575349).
          (36) EMERALD AYES (United States official number 
        986099)
          (37) EMMA (United States official number 946449).
          (38) EMPRESS (United States official number 975018).
          (39) ENDEAVOUR (United States official number 
        947869).
          (40) EVENING STAR (State of Hawaii registration 
        number HA8337D).
          (41) EXPLORER (United States official number 918080).
          (42) EXTREME (United States official number 1022278).
          (43) EXUBERANCE (United States official number 
        698516).
          (44) FIFTY ONE (United States official number 
        1020419).
          (45) FINESSE (State of Florida registration number 
        7148).
          (46) FOCUS (United States official number 909293).
          (47) FREJA VIKING (Danish registration number A395).
          (48) 3 barges owned by the Harbor Maine Corporation 
        (a corporation organized under the laws of the State of 
        Rhode Island) and referred to by that company as Harbor 
        221, Harbor 223, and Gene Elizabeth.
          (49) GIBRALTAR (United States official number 
        668634).
          (50) GLEAM (United States official number 921594).
          (51) GOD'S GRACE II (State of Alaska registration 
        number AK5916B).
          (52) HALCYON (United States official number 690219).
          (53) HAMPTON ROADS (United States official number 
        999009).
          (54) HERCO TYME (United States official number 
        911599).
          (55) HER WEIGH (United States official number 
        919074).
          (56) HIGH HOPES (United States official number 
        935174).
          (57) HIGH HOPES II (United States official number 
        959439).
          (58) HOPTOAD (Hull Identification number 528162 NET 
        12).
          (59) HOT WATER (United States official number 
        965985).
          (60) IDUN VIKING (Danish registration number A433).
          (61) INTREPID (United States official number 508185).
          (62) ISABELLE (United States official number 600655).
          (63) ISLAND STAR (United States official number 
        673537).
          (64) JAJO (Hull ID number R1Z200207H280).
          (65) JAMESTOWN (United States official number 
        999006).
          (66) JIVE DEVIL (United States official number 
        685348).
          (67) JOAN MARIE (State of North Carolina registration 
        number NC2319AV).
          (68) KALYPSO (United States official number 566349).
          (69) KARMA (United States official number 661709).
          (70) LADY HAWK (United States official number 
        961095).
          (71) LIBERTY (United States official number 375248).
          (72) LIV VIKING (Danish registration number A394).
          (73) M/V MARION C II (United States official number 
        570892).
          (74) MAGIC CARPET (United States official number 
        278971).
          (75) MAGIC MOMENTS (United States official number 
        653689).
          (76) MADRINE (United States official number 663842).
          (77) MARALINDA (State of Florida registration number 
        C023203-97).
          (78) MARANTHA (United States official number 638787).
          (79) MARSH GRASS II (Hull ID number AUKEV51139K690).
          (80) MEMORY MAKER (Hull No. 3151059, State of 
        Maryland registration number MD8867AW).
          (81) MOONRAKER (United States official number 
        645981).
          (82) MORGAN (State of Ohio registration number OH-
        0358-EA).
          (83) MOVIN ON (United States official number 585100).
          (84) MY LITTLE SHIP (State of Washington registration 
        number WN9979MF5).
          (85) NAMASTE (United States official number 594472).
          (86) OLD HAT (United States official number 508299).
          (87) ONRUST (United States official number 515058).
          (88) PAUL JOHANSEN (United States official number 
        1033607).
          (89) PHOENIX (United States official number 940997).
          (90) PLAY HARD (State of North Carolina registration 
        number NC1083CE).
          (91) POLICY MAKER III (United States official number 
        569223).
          (92) PRIME TIME (United States official number 
        660944).
          (93) QUIET SQUAW (United States official number 
        998717).
          (94) QUIETLY (United States official number 658315).
          (95) QUINTESSENCE (United States official number 
        934393).
          (96) RAFFLES LIGHT (United States official number 
        501584).
          (97) RAINBOW'S END (United States official number 
        1026899; Hull ID number MY13708C787).
          (98) RATTLESNAKE (Canadian registration number 
        802702).
          (99) REEL TOY (United States official number 698383).
          (100) RELENTLESS (United States official number 
        287008).
          (101) 2 barges owned by Roen Salvage (a corporation 
        organized under the laws of the State of Wisconsin) and 
        numbered by that company as barge 103 and barge 203.
          (102) ROYAL AFFAIRE (United States official number 
        649292).
          (103) SALLIE D (State of Maryland registration number 
        MD2655A).
          (104) SARAH-CHRISTEN (United States official number 
        342195).
          (105) SEA MISTRESS (United States official number 
        696806).
          (106) SEA SISTER (United States official number 
        951817).
          (107) SERENITY (United States official number 
        1021393).
          (108) SHAKA MARU (United States official number 
        983176).
          (109) SHAMROCK V (United States official number 
        900936).
          (110) SHOGUN (United States official number 577839).
          (111) SISU (United States official number 293648).
          (112) SMALLEY (6808 Amphibious Dredge: State of 
        Florida registration number FL1855FF).
          (113) SNOW HAWK (United States official number 955-
        637).
          (114) SOUTHERN CRUZ (United States official number 
        556797).
          (115) SUNDOWN (United States official number 293434).
          (116) SUNRISE (United States official number 950381).
          (117) TECUMSEH (United States official number 
        668633).
          (118) THE SUMMER WIND (United States official number 
        905819).
          (119) TIVOLI (United States official number 582516).
          (120) TOO MUCH FUN (United States official number 
        936565).
          (121) TOP GUN (United States official number 623642).
          (122) TRIAD (United States official number 988602).
          (123) TWO CAN (United States official number 932361).
          (124) VICTORIA CLIPPER II (United States official 
        number 725338).
          (125) WATERFRONT PROPERTY (United States official 
        number 987686).
          (126) WESTFJORD (Hull ID number X-53-109).
          (127) WESTERN ATLANTIC (Panamanian registration 
        number 10484-80-CEO).
          (128) WHITE WING (United States official number 
        283818).
          (129) WHY KNOT (United States official number 
        688570).
          (130) WOLF GANG II (United States official number 
        984934).
          (131) YES DEAR (United States official number 
        578550).
          (132) Former United States military vessels, as 
        follows:
                  (A) LACV-30 hovercraft hulls numbered 1 
                through 26.
                  (B) AP-188 hovercraft hulls numbered 8701 and 
                8901.
        For the purposes of chapter 121 of title 46, United 
        States Code, and section 27 of the Merchant Marine Act, 
        1920 (46 App. U.S.C. 883), the engine twin paks, the 
        thrust and lift engines, and all spare parts, 
        appurtenances, and accessories transferred by the 
        United States with the vessels referred to in this 
        paragraph are deemed to have been built in the United 
        States.
  (b) M/V Twin Drill.--Section 601(d) of the Coast Guard 
Authorization Act of 1993 (Public Law 103-206) is amended--
          (1) in paragraph (3) by striking ``June 30, 1995'' 
        and inserting ``June 30, 1998''; and
          (2) in paragraph (4)--
                  (A) by striking ``12 months'' and inserting 
                ``36 months''; and
                  (B) by inserting ``or convert under the same 
                terms and conditions as provided in paragraphs 
                (1) and (2)'' after ``construct''; and
          (3) in paragraph (5) by striking ``constructed'' and 
        inserting ``delivered''.
  (c) Certificates of Documentation for Gallant Lady.--
          (1) In general.--Notwithstanding section 27 of the 
        Merchant Marine Act, 1920 (46 App. U.S.C. 883), section 
        8 of the Act of June 19, 1886 (24 Stat. 81, chapter 
        421; 46 App. U.S.C. 289), and section 12106 of title 
        46, United States Code, and subject to paragraph (2), 
        the Secretary of Transportation may issue a certificate 
        of documentation with an appropriate endorsement for 
        employment in coastwise trade for each of the following 
        vessels:
                  (A) GALLANT LADY (Feadship hull number 645, 
                approximately 130 feet in length).
                  (B) GALLANT LADY (Feadship hull number 651, 
                approximately 172 feet in length).
          (2) Limitation on operation.--Coastwise trade 
        authorized under a certificate of documentation issued 
        for a vessel under this section shall be limited to the 
        carriage of passengers in association with 
        contributions to charitable organizations no portion of 
        which is received, directly or indirectly, by the owner 
        of the vessel.
          (3) Condition.--The Secretary may not issue a 
        certificate of documentation for a vessel under 
        paragraph (1) unless, not later than 90 days after the 
        date of enactment of this Act, the owner of the vessel 
        referred to in paragraph (1)(B) submits to the 
        Secretary a letter expressing the intent of the owner 
        to, before April 1, 1998, enter into a contract for the 
        construction inthe United States of a passenger vessel 
of at least 130 feet in length.
          (4) Effective date of certificates.--A certificate of 
        documentation issued under paragraph (1) shall take 
        effect--
                  (A) for the vessel referred to in paragraph 
                (1)(A), on the date of the issuance of the 
                certificate; and
                  (B) for the vessel referred to in paragraph 
                (1)(B), on the date of delivery of the vessel 
                to the owner.
          (5) Termination of effectiveness of certificates.--A 
        certificate of documentation issued for a vessel under 
        paragraph
          (1) shall expire--
                  (A) on the date of the sale of the vessel by 
                the owner;
                  (B) on April 1, 1998, if the owner of the 
                vessel referred to in paragraph (1)(B) has not 
                entered into a contract for construction of a 
                vessel in accordance with the letter of intent 
                submitted to the Secretary under paragraph (3); 
                or
                  (C) on such date as a contract referred to in 
                paragraph (2) is breached, rescinded, or 
                terminated (other than for completion of 
                performance of the contract) by the owner of 
                the vessel referred to in paragraph (1)(B).
  (d) Certificates of Documentation for Enchanted Isle and 
Enchanted Seas.--Notwithstanding section 27 of the Merchant 
Marine Act, 1920 (46 App. U.S.C. 883), the Act of June 19, 1886 
(46 App. U.S.C. 289), section 12106 of title 46, United States 
Code, section 506 of the Merchant Marine Act, 1936 (46 App. 
U.S.C. 1156), and any agreement with the United States 
Government, the Secretary of Transportation may issue 
certificates of documentation with a coastwise endorsement for 
the vessels ENCHANTED ISLE (Panamanian official number 14087-
84B) and ENCHANTED SEAS (Panamanian official number 14064-84D), 
except that the vessels may not operate between or among 
islands in the State of Hawaii.
  (e) Exception to Chain of Title Restriction.--Section 27 of 
the Merchant Marine Act, 1920 (46 App. U.S.C. 883) is amended 
in the first proviso after ''no vessel'' by inserting ''of more 
than 200 gross tons (as measured under chapter 143 of title 46, 
United States Code)''.
  (f) Certificate of Documentation for a Liquified Gas 
Tanker.--Notwithstanding section 27 of the Merchant Marine Act, 
1920 (46 App. U.S.C. 883), section 12106 of title 46, United 
States Code, section 506 of the Merchant Marine Act, 1936 (46 
App. U.S.C. 1156) and any agreement with the United States 
Government, the Secretary of Transportation may issue a 
certificate of documentation with a coastwise endorsement for a 
vessel to transport liquified natural gas or liquified 
petroleum gas to the Commonwealth of Puerto Rico from other 
ports in the United States, if the vessel--
          (1) is a foreign-built vessel that was built prior to 
        the date of enactment of this Act; or
          (2) is documented under chapter 121 of title 46, 
        United States Code, before the date of enactment of 
        this Act, even if the vessel is placed under a foreign 
        registry and subsequently redocumented under that 
        chapter for operation under this section.
  (g) Vessels Deemed Constructed in United States.--
Notwithstanding any other provision of law, the coastwise 
qualified vessels COASTAL VENTURE (United States official 
number 971086), COASTAL SEA (United States official number 
666754), COASTAL NOMAD (United States official number 686157), 
and COASTAL MERCHANT (United States official number 1038382) 
are deemed to have been constructed in the United States as of 
the date of their original delivery.
  (h) Limited Waiver for the Tug MV Janis Guzzle.--
Notwithstanding any other law or any agreement with the United 
States Government, the tug MV JANIS GUZZLE (ex-G.R. MOIR; 
United States official number 608018) may be permanently 
operated in the domestic trade of the United States upon the 
repayment of
$1,140,619 to the Secretary of Transportation.
  (i) Regent Rainbow.--Notwithstanding section 27 of the 
Merchant Marine Act, 1920 (46 App. U.S.C. 883), section 8 of 
the Act of June 19, 1886 (46 App. U.S.C. 289), section 12106 of 
title 46, United States Code, section 506 of the Merchant 
Marine Act, 1936 (46 App. U.S.C. 1156), and any agreement with 
the United States Government, the Secretary of Transportation 
may issue a certificate of documentation with appropriate 
endorsement for employment in the coastwise trade for the 
vessel REGENT RAINBOW (Bahamas official number 715557), after 
the completion of the sale of the REGENT RAINBOW to an operator 
of another passenger vessel measuring more that 20,000 gross 
tons that on the day before the date of the enactment of this 
Act is in operation with a coastwise endorsement.
  (j) Military Hovercraft.--Notwithstanding any other provision 
of law, the Administrator of General Services shall waive all 
conditions and restrictions relating to transfer or use of the 
property described in subsection (a)(132) (including the engine 
twin paks, the thrust and lift engines, and all spare parts, 
appurtenances, and accessories referred to in that subsection) 
and shall transfer unconditional and unrestricted title to all 
such property to the recipient eligible donee.

                           TITLE 46. SHIPPING

                    SUBTITLE II. VESSELS AND SEAMEN

              PART B. INSPECTION AND REGULATION OF VESSELS

                    CHAPTER 33. INSPECTION GENERALLY

Sec.  3302. Exemptions

  (a) A vessel is not excluded from one category only because 
the vessel is--
          (1) included in another category of section 3301 of 
        this title; or
          (2) excluded by this section from another category of 
        section 3301 of this title.
  (b) Except as provided in subsection (c)(3) of this section, 
a fishing vessel, including a vessel chartered part-time as a 
fish tender vessel, is exempt from section 3301(1), (7), (11), 
and (12) of this title.
  (c)(1) Except as provided in paragraph (3) of this 
subsection, a fish processing vessel of not more than 5,000 
gross tons as measured under section 14502 of this title, or an 
alternate tonnage measured under section 14302 of this title as 
prescribed by the Secretary under section 14104 of this title 
is exempt from section 3301(1), (6), (7), (11), and (12) of 
this title.
  (2) Except as provided in paragraphs (3) and (4) of this 
subsection, a fish tender vessel of not more than 500 gross 
tons as measured under section 14502 of this title, or an 
alternate tonnage measured under section 14302 of this title as 
prescribed by the Secretary under section 14104 of this title 
is exempt from section 3301(1), (6), (7), (11), and (12) of 
this title.
  (3)(A) A fishing vessel or fish processing vessel is exempt 
from section 3301 (1), (6), and (7) of this title when 
transporting cargo (including fisheries-related cargo) to or 
from a place in Alaska if--
          (i) that place does not receive weekly common carrier 
        service by water from a place in the United States;
          (ii) that place receives such common carrier service 
        and the cargo is of a type not accepted by that common 
        carrier service; or
          (iii) the cargo is proprietary cargo owned by the 
        owner of the vessel or any affiliated entity or 
        subsidiary.
  (B) A fish tender vessel of not more than 500 gross tons as 
measured under section 14502 of this title, or an alternate 
tonnage measured under section 14302 of this title as 
prescribed by the Secretary under section 14104 of this title, 
which is qualified to engage in the Aleutian trade is exempt 
from section 3301 (1), (6), and (7) of this title when 
transporting cargo (including fisheries-related cargo) to or 
from a place in Alaska outside the Aleutian trade geographic 
area if--
          (i) that place does not receive weekly common carrier 
        service by water from a place in the United States;
          (ii) that place receives such common carrier service 
        and the cargo is of a type not accepted by that common 
        carrier service; or
          (iii) the cargo is proprietary cargo owned by the 
        owner of the vessel or any affiliated entity or 
        subsidiary.
  (C) In this paragraph, the term ``proprietary cargo'' means 
cargo that--
          (i) is used by the owner of the vessel or any 
        affiliated entity or subsidiary in activities directly 
        related to fishing or the processing of fish;
          (ii) is consumed by employees of the owner of the 
        vessel or any affiliated entity or subsidiary who are 
        engaged in fishing or in the processing of fish; or
          (iii) consists of fish or fish products harvested or 
        processed by the owner of the vessel or any affiliated 
        entity or subsidiary.
  (D) Notwithstanding the restrictions in subparagraph (B) of 
this paragraph, vessels qualifying under subparagraph (B) may 
transport cargo (including fishery-related products) from a 
place in Alaska receiving weekly common carrier service by 
water to a final destination in Alaska not receiving weekly 
service by water from common carriers.
  (4) A fish tender vessel is exempt from section 3301 (1), 
(6), and (7) of this title when engaged in the Aleutian trade 
if the vessel--
          (A) is not more than 500 gross tons as measured under 
        section 14502 of this title, or an alternate tonnage 
        measured under section 14302 of this title as 
        prescribed by the Secretary under section 14104 of this 
        title;
          (B) has an incline test performed by a marine 
        surveyor; and
          (C) has written stability instructions posted on 
        board the vessel.
  (d)(1) A motor vessel of less than 150 gross tons as measured 
under section 14502 of this title, or an alternate tonnage 
measured under section 14302 of this title as prescribed by the 
Secretary under section 14104 of this title, constructed before 
August 23, 1958, is not subject to inspection under section 
3301(1) of this title if the vessel is owned or demise 
chartered to a cooperative or association that only transports 
cargo owned by at least one of its members on a nonprofit basis 
between places within the waters of--
          (A) southeastern Alaska shoreward of the Boundary 
        Line; or
          (B) southeastern Alaska shoreward of the Boundary 
        Line and--
                  (i) Prince Rupert, British Columbia; or
                  (ii) waters of Washington shoreward of the 
                Boundary Line, via sheltered waters, as defined 
                in article I of the treaty dated December 9, 
                1933, between the United States and Canada 
                defining certain waters as sheltered waters.
  (2) The transportation authorized under this subsection is 
limited to and from places not receiving annual weekly 
transportation service from any part of the United States by an 
established water common carrier. However, the limitation does 
not apply to transporting cargo of a character not accepted for 
transportation by that carrier.
  (e) A vessel laid up, dismantled, or out of commission is 
exempt from inspection.
  (f) Section 3301 (4) and (8) of this title does not apply to 
an oceanographic research vessel because it is carrying 
scientific personnel.
  (g)(1) Except when compliance with major structural or major 
equipment requirements is necessary to remove an especially 
hazardous condition, an offshore supply vessel is not subject 
to regulations or standards for those requirements if the 
vessel--
          (A) was operating as an offshore supply vessel before 
        January 2, 1979; or
          (B) was contracted for before January 2, 1979, and 
        entered into service as an offshore supply vessel 
        before October 6, 1980.
  (2) After December 31, 1988, this subsection does not apply 
to an offshore supply vessel that is at least 20 years of age.
  (h) An offshore supply vessel operating on January 1, 1979, 
under a certificate of inspection issued by the Secretary, is 
subject to an inspection standard or requirement only if the 
standard or requirement could have been prescribed for the 
vessel under authority existing under law on October 5, 1980.
  (i)(1) The Secretary may issue a permit exempting a vessel 
from any part of the requirements of this part for vessels 
transportingcargo, including bulk fuel, from one place in 
Alaska to another place in Alaska only if the vessel--
          (A) is not more than 300 gross tons as measured under 
        section 14502 of this title, or an alternate tonnage 
        measured under section 14302 of this title as 
        prescribed by the Secretary under section 14104 of this 
        title;
          (B) is in a condition that does not present an 
        immediate threat to the safety of life or the 
        environment; and
          (C) was operating in the waters off Alaska as of June 
        1, 1976, or the vessel is a replacement for a vessel 
        that was operating in the waters off Alaska as of June 
        1, 1976, if the vessel being replaced is no longer in 
        service.
  (2) Except in a situation declared to be an emergency by the 
Secretary, a vessel operating under a permit may not transport 
cargo to or from a place if the cargo could be transported by 
another commercial vessel that is reasonably available and that 
does not require exemptions to operate legally or if the cargo 
could be readily transported by overland routes.
  (3) A permit may be issued for a specific voyage or for not 
more than one year. The permit may impose specific requirements 
about the amount or type of cargo to be carried, manning, the 
areas or specific routes over which the vessel may operate, or 
other similar matters. The duration of the permit and 
restrictions contained in the permit shall be at the sole 
discretion of the Secretary.
  (4) A designated Coast Guard official who has reason to 
believe that a vessel issued a permit is in a condition or is 
operated in a manner that creates an immediate threat to the 
safety of life or the environment or is operated in a manner 
that is inconsistent with the terms of the permit, may direct 
the master or individual in charge to take immediate and 
reasonable steps to safeguard life and the environment, 
including directing the vessel to a port or other refuge.
  (5) If a vessel issued a permit creates an immediate threat 
to the safety of life or the environment, or is operated in a 
manner inconsistent with the terms of the permit or the 
requirements of paragraph (2) of this subsection, the permit 
may be revoked. The owner, charterer, managing operator, agent, 
master, or individual in charge of a vessel issued a permit, 
that willfully permits the vessel to be operated, or operates, 
the vessel in a manner inconsistent with the terms of the 
permit, is liable to the United States Government for a civil 
penalty of not more than $1,000.
  (j) Notwithstanding another provision of this chapter, the 
Secretary is not required to inspect or prescribe regulations 
for a nautical school vessel of not more than 15 gross tons as 
measured under section 14502 of this title, or an alternate 
tonnage measured under section 14302 of this title as 
prescribed by the Secretary under section 14104 of this title--
          (1) when used in connection with a course of 
        instruction dealing with any aspect of maritime 
        education or study; and
          (2) operated by--
                  (A) the United States Merchant Marine 
                Academy; or
                  (B) a State maritime academy assisted under 
                section 1304 of the Merchant Marine Act, 1936 
                (46 App. U.S.C. 1295c).
  (k) Only the boiler, engine, and other operating machinery of 
a steam vessel that is a recreational vessel of not more than 
65 feet overall in length are subject to inspection under 
section 3301(9) of this title.
  (l)(1) The Secretary may issue a permit exempting the 
following vessels from the requirements of this part for 
passenger vessels so long as the vessels are owned by nonprofit 
organizations and operated as nonprofit memorials to merchant 
mariners:
          (A) The steamship John W. Brown (United States 
        official number 242209), owned by Project Liberty Ship 
        Baltimore, Incorporated, located in Baltimore, 
        Maryland.
          (B) The steamship Lane Victory (United States 
        official number 248094), owned by the United States 
        Merchant Marine Veterans of World War II, located in 
        San Pedro, California.
          (C) The steamship Jeremiah O'Brien (United States 
        official number 243622), owned by the National Liberty 
        Ship Memorial, Inc.
          (D) The steamship SS Red Oak Victory (United states 
        official number 249410), owned by the Richmond Museum 
        Association, located in Richmond, California.
          (E) The SS American Victory (United states official 
        number 248005), owned by Victory Ship, Inc., of Tampa, 
        Florida.
  (2) The Secretary may issue a permit for a specific voyage or 
for not more than one year. The Secretary may impose specific 
requirements about the number of passengers to be carried, 
manning, the areas or specific routes over which the vessel may 
operate, or other similar matters.
  (3) A designated Coast Guard official who has reason to 
believe that a vessel operating under this subsection is in a 
condition or is operated in a manner that creates an immediate 
threat to life or the environment or is operated in a manner 
that is inconsistent with this section, may direct the master 
or individual in charge to take immediate and reasonable steps 
to safeguard life and the environment, including directing the 
vessel to a port or other refuge.
  (m) A seagoing barge is not subject to inspection under 
section 3301(6) of this title if the vessel is unmanned and 
does not carry--
          (1) a hazardous material as cargo; or
          (2) a flammable or combustible liquid, including oil, 
        in bulk.

                           TITLE 46. SHIPPING

                    SUBTITLE II. VESSELS AND SEAMEN

                   PART H. IDENTIFICATION OF VESSELS

                 CHAPTER 121. DOCUMENTATION OF VESSELS

Sec.  12111. Surrender and invalidation of certificates of 
                    documentation

  (a) A certificate of documentation is invalid if the vessel 
for which it is issued--
          (1) no longer meets the requirements of this chapter 
        and regulations prescribed under this chapter 
        applicable to that certificate of documentation; or
          (2) is placed under the command of a person not a 
        citizen of the United States in violation of section 
        12110(d) of this title.
  (b) An invalid certificate of documentation must be 
surrendered as provided by regulations prescribed by the 
Secretary of Transportation.
  (c)(1) Notwithstanding subsection (a) of this section, until 
the certificate of documentation is surrendered with the 
approval of the Secretary, a documented vessel is deemed to 
continue to be documented under this chapter for purposes of--
          (A) chapter 313 of this title for an instrument filed 
        or recorded before the date of invalidation and an 
        assignment after that date;
          (B) sections 9 and 37(b) of the Shipping Act, 1916 
        (46 App. U.S.C. 808, 835(b));
          (C) section 902 of the Merchant Marine Act, 1936 (46 
        App. U.S.C. 1242); and
          (D) any other law of the United States identified by 
        the Secretary by regulation as a law to which the 
        Secretary applies this subsection.
  (2) This subsection does not apply when a vessel is forfeited 
or sold by order of a district court of the United States.
  (3) The Secretary may approve the surrender of the 
certificate of documentation of a documented vessel covered by 
a mortgage filed or recorded under section 31321 of this title 
only if the mortgagee consents.
  (d)(1) The Secretary shall not refuse to approve the 
surrender of the certificate of documentation for a vessel 
solely on the basis that a notice of a claim of a lien on the 
vessel has been recorded under section 31343(a) of this title.
  (2) The Secretary may condition approval of the surrender of 
the certificate of documentation for a vessel over 1,000 gross 
tons.

                           TITLE 46. SHIPPING

                    SUBTITLE III. MARITIME LIABILITY

         CHAPTER 313. COMMERCIAL INSTRUMENTS AND MARITIME LIENS

                 SUBCHAPTER II. COMMERCIAL INSTRUMENTS

Sec.  31325. Preferred mortgage liens and enforcement

  (a) A preferred mortgage is a lien on the mortgaged vessel in 
the amount of the outstanding mortgage indebtedness secured by 
the vessel.
  (b) On default of any term of the preferred mortgage, the 
mortgagee may--
          (1) enforce the preferred mortgage lien in a civil 
        action in rem for a documented vessel, a vessel to be 
        documented under chapter 121 of this title, a vessel 
        titled in a State, or a foreign vessel;
          (2) enforce a claim for the outstanding indebtedness 
        secured by the mortgaged vessel in--
                  (A) a civil action in personam in admiralty 
                against the mortgagor, maker, comaker, or 
                guarantor for the amount of the outstanding 
                indebtedness or any deficiency in full payment 
                of that indebtedness; and
                  (B) a civil action against the mortgagor, 
                maker, comaker, or guarantor for the amount of 
                the outstanding indebtedness or any deficiency 
                in full payment of that indebtedness; and
          (3) enforce the preferred mortgage lien or a claim 
        for the outstanding indebtedness secured by the 
        mortgaged vessel, or both, by exercising any other 
        remedy (including an extrajudicial remedy) against a 
        documented vessel, a vessel for which an application 
        for documentation is filed under chapter 121 of this 
        title, a vessel titled in a State, a foreign vessel, or 
        a mortgagor, maker, comaker, or guarantor for the 
        amount of the outstanding indebtedness or any 
        deficiency in full payment of that indebtedness, if--
                  (A) the remedy is allowed under applicable 
                law; and
                  (B) the exercise of the remedy will not 
                result in a violation of section 9 or 37 of the 
                Shipping Act, 1916 (46 App. U.S.C. 808, 835).
  (c) The district courts have original jurisdiction of a civil 
action brought under subsection (b)(1) or (2) of this section. 
However, for a documented vessel, a vessel to be documented 
under chapter 121 of this title, a vessel titled in a State, or 
a foreign vessel, this jurisdiction is exclusive of the courts 
of the States for a civil action brought under subsection 
(b)(1) of this section.
  (d)(1) Actual notice of a civil action brought under 
subsection (b)(1) of this section, or to enforce a maritime 
lien, must be given in the manner directed by the court to--
          (A) the master or individual in charge of the vessel;
          (B) any person that recorded under section 31343(a) 
        or (d) of this title [a notice of a claim] an unexpired 
        notice of a claim of an undischarged lien on the 
        vessel; and
          (C) a mortgagee of a mortgage filed or recorded under 
        section 31321 of this title that is an undischarged 
        mortgage on the vessel.
  (2) Notice under paragraph (1) of this subsection is not 
required if, after search satisfactory to the court, the person 
entitled to the notice has not been found in the United States.
  (3) Failure to give notice required by this subsection does 
not affect the jurisdiction of the court in which the civil 
action is brought. However, unless notice is not required under 
paragraph (2) of this subsection, the party required to give 
notice is liable to the person not notified for damages in the 
amount of that person's interest in the vessel terminated by 
the action brought under subsection (b)(1) of this section. A 
civil action may be brought to recover the amount of the 
terminated interest. The district courts have original 
jurisdiction of the action, regardless of the amount in 
controversy or the citizenship of the parties. If the plaintiff 
prevails, the court may award costs and attorney fees to the 
plaintiff.
  (e) In a civil action brought under subsection (b)(1) of this 
section--
          (1) the court may appoint a receiver and authorize 
        the receiver to operate the mortgaged vessel and shall 
        retain in rem jurisdiction over the vessel even if the 
        receiver operates the vessel outside the district in 
        which the court is located; and
          (2) when directed by the court, a United States 
        marshal may take possession of a mortgaged vessel even 
        if the vessel is inthe possession or under the control 
of a person claiming a possessory common law lien.
  (f)(1) Before title to the documented vessel or vessel for 
which an application for documentation is filed under chapter 
121 is transferred by an extrajudicial remedy, the person 
exercising the remedy shall give notice of the proposed 
transfer to the Secretary, to the mortgagee of any mortgage on 
the vessel filed in substantial compliance with section 31321 
of this title before notice of the proposed transfer is given 
to the Secretary, and to any person that recorded [a notice of 
a claim] an unexpired notice of a claim of an undischarged lien 
on the vessel under section 31343(a) or (d) of this title 
before notice of the proposed transfer is given to the 
Secretary.
  (2) Failure to give notice as required by this subsection 
shall not affect the transfer of title to a vessel. However, 
the rights of any holder of a maritime lien or a preferred 
mortgage on the vessel shall not be affected by a transfer of 
title by an extrajudicial remedy exercised under this section, 
regardless of whether notice is required by this subsection or 
given.
  (3) The Secretary shall prescribe regulations establishing 
the time and manner for providing notice under this subsection.

                           TITLE 46. SHIPPING

                    SUBTITLE III. MARITIME LIABILITY

         CHAPTER 313. COMMERCIAL INSTRUMENTS AND MARITIME LIENS

                     SUBCHAPTER III. MARITIME LIENS

[Sec.  31343. Recording and discharging liens on preferred mortgage 
                    vessels]

Sec.  33143. Recording and discharging liens

  (a) Except as provided under subsection (d) of this section, 
a person claiming a lien on a vessel [covered by a preferred 
mortgage filed or recorded under this chapter] documented, or 
for which an application for documentation has been filed, 
under chapter 121 may record with the Secretary of 
Transportation a notice of that person's lien claim on the 
vessel. To be recordable, the notice must--
          (1) state the nature of the lien;
          (2) state the date the lien was established;
          (3) state the amount of the lien;
          (4) state the name and address of the person; and
          (5) be signed and acknowledged.
  [(b) The Secretary shall record a notice complying with 
subsection (a) of this section.]
  (b)(1) The Secretary shall record a notice complying with 
subsection (a) of this section if, when the notice is presented 
to the Secretary for recording, the person having the claim 
files with the notice a declaration stating the following:
          (A) The information in the notice is true and correct 
        to the best of the knowledge, information, and belief 
        of the individual who signed it.
          (B) A copy of the notice, as presented for 
        recordation, has been sent to each of the following:
                  (i) The owner of the vessel.
                  (ii) Each person that recorded under section 
                31343(a) of this title an unexpired notice of a 
                claim of an undischarged lien on the vessel.
                  (iii) The mortgagee of each mortgage filed or 
                recorded under section 31321 of this title that 
                is an undischarged mortgage on the vessel.
  (2) A declaration under this subsection filed by a person 
that is not an individual must be signed by the president, 
member, partner, trustee, or other official authorized to 
execute the declaration on behalf of the person.
  [(c) On full and final discharge of the indebtedness that is 
the basis for a claim recorded under subsection (b) of this 
section, on request of the Secretary or owner, the person 
having the claim shall provide the Secretary with an 
acknowledged certificate of discharge of the indebtedness. The 
Secretary shall record the certificate.]
  (c)(1) On full and final discharge of the indebtedness that 
is the basis for a notice of claim of lien recorded under 
subsection (b) of this section, the person having the claim 
shall provide the Secretary with an acknowledged certificate of 
discharge of the indebtedness. The Secretary shall record the 
certificate.
  (2) The district courts of the United States shall have 
jurisdiction over a civil action to declare that a vessel is 
not subject to a lien claimed under subsection (b) of this 
section, or that the vessel is not subject to the notice of 
claim of lien, or both, regardless of the amount in controversy 
or the citizenship of the parties. Venue in such an action 
shall be in the district where the vessel is found, or where 
the claimant resides, or where the notice of claim of lien is 
recorded. The court may award costs and attorneys fees to the 
prevailing party, unless the court finds that the position of 
the other party was substantially justified or other 
circumstances make an award of costs and attorneys fees unjust.
  (d) A person claiming a lien on a vessel covered by a 
preferred mortgage under section 31322(d) of this title must 
record and discharge the lien as provided by the law of the 
State in which the vessel is titled.
  (e) A notice of claim of lien recorded under subsection (b) 
of this section shall expire 3 years after the date specified 
in the notice under subsection (b) of this section.
  (f) This section does not alter in any respect the law 
pertaining to the establishment of a maritime lien, the remedy 
provided by such a lien, or the defenses thereto, including any 
defense under the doctrine of laches.

                           SHIPPING ACT, 1916

                          [46 U.S.C. APP. 808]

Sec.  9. Registration, enrollment, and licensing of vessels purchased, 
                    chartered, or leased; regulations; coastwise trade

  (a) [Repealed].
  (b) Every vessel purchased, chartered, or leased from the 
Secretary of Transportation shall, unless otherwise authorized 
by the
Secretary of Transportation, be operated only under such 
registry or enrollment and license. Such vessels while employed 
solely as merchant vessels shall be subject to all laws, 
regulations, and liabilities governing merchant vessels, 
whether the United States be interested therein as owner, in 
whole or in part, or hold any mortgage, lien, or other interest 
therein.
  (c) [Except as provided in section 611 of the Merchant Marine 
Act, 1936 (46 App. U.S.C. 1181), and sections 12106(e), 
31322(a)(1)(D) of title 46,] Except as provided in section 611 
of the Merchant Marine Act, 1936 (46 App. U.S.C. 1181) and in 
sections 12106(e) and 31322(a)(1)(D) of title 46, United States 
Code, a person may not, without the approval of the Secretary 
of Transportation--
          (1) sell, lease, charter, deliver, or in any manner 
        transfer, or agree to sell, lease, charter, deliver, or 
        in any manner transfer, to a person not a citizen of 
        the United States, any interest in or control of a 
        documented vessel (except in a vessel that has been 
        operated only as a fishing vessel, fish processing 
        vessel, or fish tender vessel (as defined in section 
        2101 of title 46, United States Code) or in a vessel 
        that has been operated only for pleasure) owned by a 
        citizen of the United States or the last documentation 
        of which was under the laws of the United States; or
          (2) place a documented vessel, or a vessel the last 
        documentation of which was under the laws of the United 
        States, under foreign registry or operate that vessel 
        under the authority of a foreign country.
  (d)(1) Any charter, sale, or transfer of a vessel, or 
interest in or control of that vessel, contrary to this section 
is void.
  (2) A person that knowingly charters, sells, or transfers a 
vessel, or interest in or control of that vessel, contrary to 
this section shall be fined under title 18, United States Code, 
imprisoned for not more than 5 years, or both.
  (3) A documented vessel may be seized by, and forfeited to, 
the United States Government if--
          (A) the vessel is placed under foreign registry or 
        operated under the authority of a foreign country 
        contrary to this section; or
          (B) a person knowingly charters, sells, or transfers 
        a vessel, or interest or control in that vessel, 
        contrary to this section.
  (4) A person that charters, sells, or transfers a vessel, or 
an interest in or control of a vessel, in violation of this 
section is liable to the United States Government for a civil 
penalty of not more than $ 10,000 for each violation.
  (e) Notwithstanding subsection (c)(2), the Merchant Marine 
Act, 1936, or any contract entered into with the Secretary of 
Transportation under that Act, a vessel may be placed under a 
foreign registry, without approval of the Secretary, if--
          (1)(A) the Secretary determines that at least one 
        replacement vessel of a capacity that is equivalent or 
        greater, as measured by deadweight tons, gross tons, or 
        container equivalent units, as appropriate, is 
        documented under chapter 121 of title 46, United States 
        Code, by the owner of the vessel placed under the 
        foreign registry; and
          (B) the replacement vessel is not more than 10 years 
        of age on the date of that documentation;
          (2)(A) an application for an operating agreement 
        under subtitle B of title VI of the Merchant Marine 
        Act, 1936 has been filed with respect to a vessel which 
        is eligible to be included in the Maritime Security 
        Fleet under section 651(b)(1) of that Act; and
          (B) the Secretary has not awarded an operating 
        agreement with respect to that vessel within 90 days 
        after the date of that application;
          (3) a contract covering the vessel under subtitle A 
        of title VI of the Merchant Marine Act, 1936 has 
        expired, and that vessel is more than 15 years of age 
        on the date the contract expires; or
          (4) an operating agreement covering the vessel under 
        subtitle B of title VI of the Merchant Marine Act, 1936 
        has expired.
  (e) To promote financing with respect to a vessel to be 
documented under chapter 121 of title 46, United States Code, 
the Secretary may grant approval under subsection (c) before 
the date the vessel is documented.

                                
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