I 
108TH CONGRESS 
1ST SESSION H. R. 2846
To amend the Merchant Marine Act, 1920, to allow transportation of mer-
chandise 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 transpor-
tation of merchandise in Hawaiian noncontiguous trade 
on foreign-flag vessels, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Hawaii Shipping Open 
Market Act of 2003’’. 
SEC. 2. TRANSPORTATION OF CERTAIN MERCHANDISE.
(a) IN GENERAL.—Section 27 of the Merchant Ma-
rine Act, 1929 (46 App. U.S.C. 883) is amended by insert-
ing ‘‘(a) IN GENERAL.—’’ before the first sentence, and 
by adding at the end the following: 
‘‘(b) NONCONTIGUOUS TRADE EXEMPTION.—Sub-
section (a) shall not apply with respect to transportation 
in Hawaiian noncontiguous trade of merchandise on a for-
eign qualified freight vessel for which the Secretary of 
Transportation has issued a certificate of documentation. 
‘‘(c) DEFINITIONS.—In this section: 
‘‘(1) FOREIGN QUALIFIED FREIGHT VESSEL.—
The term ‘foreign qualified freight vessel’ means a 
freight vessel (as that term is defined in section 
2101 of title 46, United States Code) of not less 
than 1,000 gross tons that—
‘‘(A) was not built in the United States (or 
if rebuilt, not rebuilt in the United States); 
‘‘(B) is registered in a foreign country; and 
‘‘(C) employs United States citizens to the 
extent required of vessels registered under sec-
tion 12102 of this title. 
‘‘(2) HAWAIIAN NONCONTIGUOUS TRADE.—The 
term ‘Hawaiian noncontiguous trade’ means—
‘‘(A) trade between a point in the contig-
uous 48 States or Alaska and a point in Ha-
waii; or
‘‘(B) trade between any point in Hawaii 
and any other point in Hawaii.’’. 
(b) COASTWISE ENDORSEMENTS.—12106(b) of title 
46, United States Code, is amended—
(1) by inserting ‘‘(1)’’ after ‘‘(b)’’; 
(2) by inserting ‘‘to paragraph (2) and’’ after 
‘‘Subject’’; and 
(3) by adding at the end the following: 
‘‘(2)(A) Paragraph (1) shall not apply with respect 
to a foreign qualified freight vessel used for transportation 
referred to in section 27(b) of the Merchant Marine Act, 
1920 (46 App. U.S.C. 883(b)), for which the Secretary 
of Transportation has issued a certificate of documenta-
tion. 
‘‘(B) In subparagraph (A) the term ‘foreign qualified 
freight vessel’ has the meaning given that term in section 
27(c) of the Merchant Marine Act, 1920 (46 App. U.S.C. 
883(c)).’’. 
(c) FOREIGN TRANSFER.—Section 9(c) of the Ship-
ping Act, 1916 (46 App. U.S.C. 808) is amended by in-
serting ‘‘(1)’’ before the first sentence, and by adding at 
the end the following: 
‘‘(2)(A) Notwithstanding paragraph (1), a foreign 
qualified freight vessel for which the Secretary has issued 
a certificate of documentation after the date of enactment
of this Act and that is used solely for transportation re-
ferred to in section 27(b) of the Merchant Marine Act, 
1920 (46 App. U.S.C. 883(b)) may be placed under for-
eign registry without the approval of the Secretary at any 
time after that vessel is issued a certificate of documenta-
tion. At such time as that vessel is placed under foreign 
registry, the Secretary shall revoke the certificate of docu-
mentation issued by the Secretary. 
‘‘(B) In subparagraph (A) the term ‘foreign qualified 
freight vessel’ has the meaning given that term in section 
27(c) of the Merchant Marine Act, 1920 (46 App. U.S.C. 
883(c)).’’.
SEC. 3. CITIZENSHIP AND TRANSFER PROVISIONS. 
(a) CITIZENSHIP OF CORPORATIONS, PARTNERSHIPS, 
AND ASSOCIATIONS.—Section 2 of the Shipping Act, 1916 
(46 U.S.C. App. 802) is amended by adding at the end 
the following: 
‘‘(d)(1) The following provisions of this section shall 
not apply to a foreign qualified freight vessel used for 
transportation referred to in section 27(b) of the Merchant 
Marine Act, 1920 (46 App. U.S.C. 883(b)): 
‘‘(A) The text of subparagraph after ‘possession 
thereof’. 
‘‘(B) subsection (c).
‘‘(2) In paragraph (1) the term ‘foreign qualified 
freight vessel’ has the meaning given that term in section 
27(c) of the Merchant Marine Act, 1920 (46 App. U.S.C. 
883(c)).’’. 
(b) APPROVAL OF TRANSFER OF REGISTRY OR OP-
ERATION UNDER AUTHORITY OF A FOREIGN COUNTRY OR 
FOR SCRAPPING IN A FOREIGN COUNTRY; PENALTIES.—
Section 9 of the Shipping Act, 1916 (46 U.S.C. App. 808) 
is amended by adding at the end the following: 
‘‘(e)(1) In lieu of the penalty under subsection (d), 
a person that commits an act described in paragraph (2) 
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. 
‘‘(2) The acts referred to in paragraph (1) are the 
following: 
‘‘(A) Charter, sell, or transfer a foreign quali-
fied freight vessel used for transportation referred to 
in section 27(b) of the Merchant Marine Act, 1920 
(46 App. U.S.C. 883(b)), or interest in or control of 
such a vessel.
‘‘(B) Place under foreign registry a foreign 
qualified freight vessel used for transportation re-
ferred to in section 27(b) of the Merchant Marine
(2) by adding at the end of paragraph (1) (as 
designated under paragraph (1) of this subsection) 
the following new sentence: ‘‘In an action brought 
under this subsection against a defendant employer 
that does not reside or maintain an office in the 
United States (including any territory or possession 
of the United States) and that engages in any enter-
prise that makes use of one or more ports in the 
United States (as defined in section 2101 of title 46, 
United States Code), jurisdiction shall be under the 
district court most proximate to the place of the oc-
currence of the personal injury or death that is the 
subject of the action.’’; and 
(3) by adding at the end the following new 
paragraph: 
‘‘(2)(A) The employer of a master or member of the 
crew of a vessel—
‘‘(i) may, at the election of the employer, par-
ticipate in an authorized compensation plan under 
the Longshore and Harbor Workers’ Compensation 
Act (33 U.S.C. 901 et seq.); and 
‘‘(ii) if the employer makes an election under 
clause (i), notwithstanding section 2(3)(G) of the 
Longshore and Harbor Workers’ Compensation Act 
(33 U.S.C. 902(3)(G)), shall be subject to that Act.
‘‘(B) If an employer makes an election, in accordance 
with subparagraph (A), to participate in an authorized 
compensation plan under the Longshore and Harbor 
Workers’ Compensation Act—
‘‘(i) a master or crew member employed by that 
employer shall be considered to be an employee for 
the purposes of that Act; and
‘‘(ii) the liability of that employer under that 
Act to the master or crew member, or to any person 
otherwise entitled to recover damages from the em-
ployer based on the injury, disability, or death of the 
master or crew member, shall be exclusive and in 
lieu of all other liability.’’. 
(b) MINIMUM REQUIREMENTS.—All vessels, whether 
documented in the United States or not, operating in the 
coastwise trade of the United States shall be subject to 
minimum international labor standards for seafarers 
under international agreements in force for the United 
States, as determined by the Secretary of Transportation 
on the advice of the Secretaries of Labor and Defense. 
SEC. 5. REGULATIONS REGARDING VESSELS. 
(a) APPLICABLE MINIMUM REQUIREMENTS.—Except 
as provided in subsection (b), the minimum requirements 
for vessels engaging in the transportation of cargo or mer-
chandise in the United States coastwise trade shall be the
recognized international standards in force for the United 
States (as determined by the Secretary of the department 
in which the Coast Guard is operating, in consultation 
with any other official of the Federal Government that the 
Secretary determines to be appropriate). 
(b) CONSISTENCY
IN
APPLICATION
OF
STAND-
ARDS.—In any case in which any minimum requirement 
for vessels referred to in subsection (a) establishes a lower 
standard than a minimum that is applicable to vessels that 
are documented in a foreign country and that are admit-
ted to engage in the transportation of cargo and merchan-
dise in the United States coastwise trade, the standard 
applicable to such vessels that are documented in a foreign 
country shall be the standard that is applied to United 
States documented vessels. 
SEC. 6. ENVIRONMENTAL STANDARDS. 
All vessels, whether documented under the laws of the 
United States or not, engaging in the United States coast-
wise trade shall comply with all applicable United States 
and international environmental standards in force for the 
United States.
SEC. 7. REQUIREMENTS FOR CERTAIN NONCITIZENS IR-
REGULARLY ENGAGING IN DOMESTIC COAST-
WISE TRADE. 
(a) IN GENERAL.—Each person or entity that is not 
a citizen of the United States, as defined in section 
2101(3a) of title 46, United States Code, that owns or 
operates vessels that irregularly engage in the United 
States domestic coastwise trade shall—
(1) name an agent upon whom process may be 
served; 
(2) abide by all applicable laws of the United 
States, including applicable environmental and tax 
laws; and 
(3) post evidence of documentation and en-
dorsements aboard such vessel indicating the owner 
or owners of such vessel, including any person con-
trolling vessels and the number of port calls and 
coastwise trips made during that calendar year. 
(b) PERSONS TREATED AS SINGLE EMPLOYER.—For 
purposes of paragraph (3), all persons treated as a single 
employer under subsection (a) or (b) of section 52 of the 
Internal Revenue Code of 1986 shall be treated as 1 per-
son.
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