203 
‘‘(1) CRIMINAL PENALTY.—A person that violates, or attempts or 
conspires to violate, this section shall be fined under title 18, impris-
oned for not more than 5 years, or both. 
‘‘(2) FORFEITURE.—The following shall be forfeited to the Govern-
ment: 
‘‘(A) A vessel, a facility for building or repairing vessels, or an 
interest in a vessel or such a facility, that is sold, mortgaged, 
leased, chartered, delivered, transferred, or documented, or agreed 
to be sold, mortgaged, leased, chartered, delivered, transferred, or 
documented, in violation of this section. 
‘‘(B) Stock and other securities sold or transferred, or agreed 
to be sold or transferred, in violation of this section. 
‘‘(C) A vessel departing in violation of subsection (a)(6). 
‘‘§ 56103. Conditional approvals 
‘‘(a) IN GENERAL.—In approving an act or transaction under section 
56101 or 56102 of this title, the Secretary of Transportation may do so 
absolutely or upon conditions the Secretary considers advisable. The Sec-
retary shall state the conditions in the notice of approval. 
‘‘(b) VIOLATIONS.—A violation of a condition of approval is subject to the 
same penalties as a violation resulting from an act done without the re-
quired approval. The violation occurs at the time the condition is violated. 
‘‘§ 56104. Penalty for false statements 
‘‘A person that knowingly makes a false statement of a material fact to 
the Secretary of Transportation or another officer, employee, or agent of the 
Department of Transportation, to obtain the Secretary’s approval under sec-
tion 56101 or 56102 of this title, shall be fined under title 18, imprisoned 
for not more than 5 years, or both. 
‘‘§ 56105. Forfeiture procedure 
‘‘(a) IN GENERAL.—A forfeiture under this chapter may be enforced in 
the same way as a forfeiture under the laws on the collection of duties. 
However, such a forfeiture may be remitted without seizure of the vessel. 
‘‘(b) PRIOR CONVICTIONS.—In a proceeding under this chapter to enforce 
a forfeiture, a prior criminal conviction of a person for a violation of this 
chapter with respect to the subject matter of the forfeiture is prima facie 
evidence of the violation against the person convicted. 
‘‘CHAPTER 563—EMERGENCY ACQUISITION OF VESSELS 
‘‘Sec. 
‘‘56301.
General authority. 
‘‘56302.
Charter terms. 
‘‘56303.
Compensation. 
‘‘56304.
Disputed compensation. 
‘‘56305.
Vessel encumbrances. 
‘‘56306.
Use and transfer of vessels. 
‘‘56307.
Return of vessels. 
VerDate Aug 31 2005 
02:33 Sep 08, 2006
Jkt 049006
PO 00000
Frm 00203
Fmt 6652
Sfmt 6231
E:\BILLS\H1442.RS
H1442
pwalker on PRODPC60 with BILLS
204 
‘‘§ 56301. General authority 
‘‘During a national emergency declared by Presidential proclamation, or 
a period for which the President has proclaimed that the security of the na-
tional defense makes it advisable, the Secretary of Transportation may req-
uisition or purchase, or requisition or charter the use of, a vessel owned by 
citizens of the United States, a documented vessel, or a vessel under con-
struction in the United States. 
‘‘§ 56302. Charter terms 
‘‘(a) IN GENERAL.—If a vessel is requisitioned for use but not ownership 
under this chapter, the Secretary of Transportation, at the time of requisi-
tion or as soon thereafter as the situation allows, shall offer the person enti-
tled to possession of the vessel a charter containing— 
‘‘(1) the terms the Secretary believes should govern the relationship 
between the United States Government and the person; and 
‘‘(2) the rate of hire the Secretary considers just compensation for 
the use of the vessel and the services required under the charter. 
‘‘(b) REFUSAL TO ACCEPT.—If the person does not accept the charter 
and rate of hire, the parties shall proceed as provided in section 56304 of 
this title. 
‘‘§ 56303. Compensation 
‘‘(a) IN GENERAL.—As soon as practicable, the Secretary of Transpor-
tation shall determine and pay just compensation for a vessel requisitioned 
under this chapter. 
‘‘(b) FACTORS NOT AFFECTING VALUE.—The value of a vessel may not 
be considered enhanced by the circumstances requiring its requisition. Con-
sequential damages arising from the requisition may not be paid. 
‘‘(c) EFFECT OF CONSTRUCTION-DIFFERENTIAL SUBSIDY.— 
‘‘(1) IF PAID.—If a construction-differential subsidy has been paid 
for the vessel, the value of the vessel at the time of requisition shall 
be determined under section 802 of the Merchant Marine Act, 1936. 
‘‘(2) IF NOT PAID.—If a construction-differential subsidy has not 
been paid for the vessel, the value of any national defense features pre-
viously paid for by the United States Government shall be excluded. 
‘‘(d) LOSS OR DAMAGE DURING CHARTER.—If a vessel is lost or dam-
aged by a risk assumed by the Government under the charter, but a valu-
ation for the vessel or a means of compensation has not been agreed to, 
the Secretary shall pay just compensation for the loss or damage, to the 
extent the person is not reimbursed through insurance. 
‘‘§ 56304. Disputed compensation 
‘‘If the person entitled to compensation disputes the amount of just com-
pensation determined by the Secretary of Transportation under this chapter, 
VerDate Aug 31 2005 
02:33 Sep 08, 2006
Jkt 049006
PO 00000
Frm 00204
Fmt 6652
Sfmt 6221
E:\BILLS\H1442.RS
H1442
pwalker on PRODPC60 with BILLS
205 
the Secretary shall pay the person, as a tentative advance, 75 percent of 
the amount determined. The person may bring a civil action against the 
United States to recover just compensation. If the tentative advance paid 
under this section is greater than the amount of the court’s judgment, the 
person shall refund the difference. 
‘‘§ 56305. Vessel encumbrances 
‘‘(a) IN GENERAL.—The existence of an encumbrance on a vessel does 
not prevent the requisition of the vessel under this chapter. 
‘‘(b) DEPOSIT IN TREASURY.— 
‘‘(1) IN
GENERAL.—If an encumbrance exists, the Secretary of 
Transportation may deposit part of the compensation or advance of 
compensation to be paid under this chapter (but not more than the 
total amount of all encumbrances) in a fund in the Treasury. The Sec-
retary shall publish notice of the creation of the fund in the Federal 
Register. 
‘‘(2) AVAILABILITY OF AMOUNTS DEPOSITED.—Amounts deposited in 
the fund shall be available to pay the compensation or any of the en-
cumbrances (including encumbrances stipulated to in a court of the 
United States or a State) existing at the time the vessel was requi-
sitioned. 
‘‘(c) CIVIL ACTION.— 
‘‘(1) IN GENERAL.—Within 6 months after publication of notice 
under subsection (b), the holder of an encumbrance may bring a civil 
action in admiralty, according to the principles of libels in rem, against 
the fund. 
‘‘(2) VENUE.—The action must be brought in the district court of 
the United States— 
‘‘(A) from whose custody the vessel was or may be requisitioned; 
or 
‘‘(B) in whose district the vessel was located when it was requi-
sitioned. 
‘‘(3) SERVICE OF PROCESS.—Service of process shall be made on the 
appropriate United States Attorney, the Attorney General, and the Sec-
retary, in the manner provided by the Federal Rules of Civil Procedure 
(28 App. U.S.C.). Notice of the action shall be given to all interested 
persons as ordered by the court. 
‘‘(4) AS BETWEEN PRIVATE PARTIES.—The action shall proceed and 
be determined according to the principles of law and the rules of prac-
tice applicable in like cases between private parties. 
VerDate Aug 31 2005 
02:33 Sep 08, 2006
Jkt 049006
PO 00000
Frm 00205
Fmt 6652
Sfmt 6221
E:\BILLS\H1442.RS
H1442
pwalker on PRODPC60 with BILLS
206 
‘‘§ 56306. Use and transfer of vessels 
‘‘(a) IN GENERAL.—The Secretary of Transportation may repair, recon-
dition, reconstruct, operate, or charter for operation, a vessel acquired under 
this chapter. 
‘‘(b) TRANSFER TO OTHER AGENCIES.—The Secretary may transfer the 
possession or control of a vessel acquired under this chapter to another de-
partment or agency of the United States Government on terms and condi-
tions approved by the President. The department or agency shall promptly 
reimburse the Secretary for expenditures for just compensation, purchase 
price, charter hire, repairs, reconditioning, or reconstruction. 
‘‘§ 56307. Return of vessels 
‘‘When a vessel requisitioned for use but not ownership is returned to the 
owner, the Secretary of Transportation shall— 
‘‘(1) return the vessel in a condition at least as good as when taken, 
less ordinary wear and tear; or 
‘‘(2) pay the owner an amount sufficient to recondition the vessel to 
that condition, less ordinary wear and tear. 
‘‘CHAPTER 565—ESSENTIAL VESSELS AFFECTED BY 
NEUTRALITY ACT 
‘‘Sec. 
‘‘56501.
Definition. 
‘‘56502.
Adjusting obligations and arranging maintenance. 
‘‘56503.
Types of adjustments and arrangements. 
‘‘56504.
Changes in adjustments and arrangements. 
‘‘§ 56501. Definition 
‘‘In this chapter, the term ‘essential vessel’ means a vessel that is— 
‘‘(1)(A) security for a mortgage indebtedness to the United States 
Government; or 
‘‘(B) constructed under this subtitle or required by a contract under 
this subtitle to be operated on a certain essential foreign trade route; 
and 
‘‘(2) necessary in the interests of commerce and national defense to 
be maintained in condition for prompt use. 
‘‘§ 56502. Adjusting obligations and arranging maintenance 
‘‘(a) GENERAL AUTHORITY.—On written application, the Secretary of 
Transportation may adjust obligations and arrange for maintenance of an 
essential vessel as provided in this chapter if the Secretary determines, after 
any investigation or proceeding the Secretary considers desirable, that— 
‘‘(1) the operation of the vessel in the service, route, or line to which 
it is assigned under this subtitle, or in which it otherwise would be op-
erated, is not— 
‘‘(A) lawful under the Neutrality Act of 1939 (22 U.S.C. 441 
et seq.) or a proclamation issued under that Act; or 
VerDate Aug 31 2005 
02:33 Sep 08, 2006
Jkt 049006
PO 00000
Frm 00206
Fmt 6652
Sfmt 6221
E:\BILLS\H1442.RS
H1442
pwalker on PRODPC60 with BILLS