(A) permanently revoke any fishery en-
dorsement issued to such vessel under section
12108 of title 46, United States Code; and
(B) refuse to grant the approval required
under section 9(c)(2) of the Shipping Act, 1916
(46 U.S.C. App. 808(c)(2)) for the placement
of such vessel under foreign registry or the op-
eration of such vessel under the authority of a
foreign country.
(2) REGULATIONS.—The Secretary shall, after
notice and opportunity for public comment, adopt
final regulations not later than 6 months after the
date of enactment of this Act, to prohibit any vessel
for which a reduction permit is surrendered and re-
voked under the fishing capacity reduction program
required by this section from engaging in fishing ac-
tivities on the high seas or under the jurisdiction of
any foreign country while operating under the
United States flag.
(g) REGULATORY FLEXIBILITY.—Any requirements
of chapter 35 of title 44, United States Code, chapter 6
of title 5, United States Code, or any Executive order that
would, in the opinion of the Secretary, prevent the Sec-
retary from meeting the deadlines set forth in this section
shall not apply to the fishing capacity reduction program
or the promulgation of regulations to implement such pro-
gram required by this section.
SEC. 5. COLLECTION OF INDUSTRY FEES.
(a) IN GENERAL.—The Secretary shall enter into an
agreement with the States of California, Oregon, and
Washington to collect program fees paid under the system
established under section 4(e).
(b) WITHHOLDING FEE FROM PURCHASE PRICE.—
The fee for each vessel required to pay a program fee
under that system shall be deducted by the first ex-vessel
fish purchaser from the proceeds otherwise payable to the
seller and forwarded to the appropriate State at the same
time and in the same manner as other fees or taxes are
forwarded to that State.
(c) STATE TO COLLECT AND FORWARD FEES.—
Upon receipt of program fees forwarded by fish purchasers
under subsection (b), the State shall forward the fees to
the Secretary in the manner provided for in the agreement
established under subsection (a).
(d) FISH-PROCESSING VESSELS TREATED AS PUR-
CHASERS.—A vessel which—
(1) both harvests and processes fish; or
(2) receives fish from a harvesting vessel and
processes that fish on board,
shall be considered to be the first ex-vessel fish purchaser
with respect to the fish processed on the vessel and shall
forward the appropriate fees to the appropriate State at
the same time and in the same manner as other fees or
taxes are forwarded to that State.
SEC. 6. AMENDMENT OF THE MERCHANT MARINE ACT, 1936,
TO EXPAND PURPOSES OF CAPITAL CON-
STRUCTION FUND.
(a) IN GENERAL.—Section 607(a) of the Merchant
Marine Act, 1936 (46 U.S.C. App. 1177(a)) is amended
by striking ‘‘of this section.’’ and inserting ‘‘of this sec-
tion. Any agreement entered into under this section may
be modified for the purpose of encouraging the sustain-
ability of the fisheries of the United States by making the
termination and withdrawal of a capital construction fund
a qualified withdrawal if done in exchange for the retire-
ment of the related commercial fishing vessels and related
commercial fishing permits.’’.
(b) NEW QUALIFIED WITHDRAWALS.—
(1) AMENDMENTS TO MERCHANT MARINE ACT,
1936.—Section 607(f)(1) of the Merchant Marine
Act, 
1936 
(46 
U.S.C. 
App. 
1177(f)(1)) 
is
amended—
(A) by striking ‘‘for:’’ and inserting
‘‘for—’’;
(B) by striking ‘‘vessel,’’ in subparagraph
(A) and inserting ‘‘vessel;’’;
(C) by striking ‘‘vessel, or’’ in subpara-
graph (B) and inserting ‘‘vessel;’’;
(D) by striking ‘‘vessel.’’ in subparagraph
(C) and inserting ‘‘vessel;’’;
(E) by inserting after subparagraph (C)
the following:
‘‘(D) the payment of an industry fee au-
thorized by the fishing capacity reduction pro-
gram under section 312(b) of the Magnuson-
Stevens Fishery Conservation and Management
Act (16 U.S.C. 1861a(b));
‘‘(E) in the case of any such person or
shareholder for whose benefit such fund was es-
tablished or any shareholder of such person, a
rollover contribution (within the meaning of
section 408(d)(3) of the Internal Revenue Code
of 1986) to such person’s or shareholder’s indi-
vidual retirement plan (as defined in section
7701(a)(37) of such Code); or
‘‘(F) the payment to a person or corpora-
tion terminating a capital construction fund for
whose benefit the fund was established and re-
tiring related commercial fishing vessels and
permits.’’; and
(F) by adding at the end the following:
‘‘(3) The Secretary by regulation shall establish pro-
cedures to ensure that any person making a qualified with-
drawal authorized under paragraph (1)(F) retires the re-
lated commercial use of fishing vessels and commercial
fishery permits.’’.
(2) AMENDMENTS
TO
INTERNAL
REVENUE
CODE OF 1986.—Section 7518(e)(1) of the Internal
Revenue Code of 1986 (relating to purposes of quali-
fied withdrawals) is amended—
(A) by striking ‘‘for:’’ and 
inserting
‘‘for—’’;
(B) by striking ‘‘vessel, or’’ in subpara-
graph (B) and inserting ‘‘vessel;’’;
(C) by striking ‘‘vessel.’’ in subparagraph
(C) and inserting ‘‘vessel;’’;
(D) by inserting after subparagraph (C)
the following:
‘‘(D) the payment of an industry fee au-
thorized by the fishing capacity reduction pro-
gram under section 312 of the Magnuson-Ste-
vens Fishery Conservation and Management
Act (16 U.S.C. 1861a);
‘‘(E) in the case of any person or share-
holder for whose benefit such fund was estab-
lished or any shareholder of such person, a roll-
over contribution (within the meaning of section
408(d)(3)) to such person’s or shareholder’s in-
dividual retirement plan (as defined in section
7701(a)(37)); or
‘‘(F) the payment to a person terminating
a capital construction fund for whose benefit
the fund was established and retiring related
commercial fishing vessels and permits.’’; and
(E) by adding at the end the following:
‘‘(3) REGULATIONS.—The Secretary by regula-
tion shall establish procedures to ensure that any
person making a qualified withdrawal authorized by
subparagraph (F) retires the related commercial use
of fishing vessels and commercial fishery permits.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to withdrawals made after the date
of enactment of this Act.
Æ