An Act to amend section 510 of the Merchant Marine Act, 1936
PL 89-254 (H.R.728), enacted 10/10/1965

980 
October 10, 1965 
[H. R. 728] 
Merchant Marine 
Act, 1936, amend-
ments. 
74 Stat. 312. 
Vessel exchange 
program, extension, 
49 Stat. 2001. 
46 u s e 1171-
1183. 
Valuation of 
vessels. 
Tanker vessels. 
National defense 
reserve fleet. 
60 Stat. 49. 
46 u s e 1191, 
1271. 
PUBLIC LAW 89-254-OCT. 10, 1965 
[79 STAT. 
Public Law 89-254 
AN ACT 
To amend section 510 of the Merchant Marine Act, 1936. 
Be it eifiacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled^ That (a) the first 
sentence of subsection (i) of section 510 of the Merchant Marine Act, 
1936, as amended (46 LT.S.C. 1160(i)), is amended as follows: 
(1) By striking out "within five years from the date of enactment of 
this Act war-built vessels (which are defined for purposes of this sub-
section as oceangoing" and inserting in lieu thereof the following: 
"before July 5,1970,". 
(2) By striking out "during the period beginning September 3,1939, 
and ending September 2, 1945)" and inserting in lieu thereof the fol-
lowing : "before September 3,1945,". 
(3) By inserting immediately before the words "owned by the 
United States" the following: " (which are defined for purposes of this 
subsection as oceangoing vessels of one thousand five hundred gross 
tons or over which were constructed or contracted for by the United 
States shipyards during the period beginning September 3, 1939, and 
ending September 2,1945)". 
(b) Paragraph (1) of subsection (i) of section 510 of the Merchant 
Marine Act, 1936, as amended, is amended to read as follows: 
"(1) The traded-in vessel shall have been owned by a citizen or 
citizens of the United States, documented under the laws of the United 
States, and shall not have been operated with operating-differential 
subsidy under title VI of this Act by the applicant or any affiliate 
of the applicant for at least three years immediately prior to the date 
of the exchange." 
(c) Paragraph (2) of subsection (i) of section 510 of the Merchant 
Marme Act, 1936, as amended, is amended by inserting after the 
period at the end thereof the following: "The value of a vessel when 
traded out shall be calculated in the same manner as its value was 
determined when it was traded in, except that vessels traded in prior 
to October 1,1960, shall be valued on the basis yielding the highest fair 
return to the Government commensurate with the purposes of this 
subsection. In each exchange of vessels under this subsection, the 
value of the vessel traded-in, unless based on scrap value, and the 
value of the vessel traded-out shall be calculated in the same manner." 
(d) Paragraph (9) of subsection (i) of section 510 of the Merchant 
Marine Act, 1936, as amended, is amended to read as follows: 
"(9) Except where traded out for use exclusively in trade and com-
merce on the Great Lakes, including the Saint Lawrence River and 
Gulf, tanker vessels may be traded out under the provisions of this 
subsection only for major conversions into dry cargo carriers or 
liquid bulk carriers, including natural gas carriers but excluding bulk 
petroleum carriers." 
SEC. 2. Section 510 of the Merchant Marine Act, 1936 is further 
amended by adding at the end thereof the following new subsection: 
"(j) Any vessel heretofore or hereafter acquired under this section, 
or otherwise acquired by the Secretary of Commerce under any other 
authority shall be placed in the national defense reserve fleet estab-
lished under authority of section 11 of the Merchant Ship Sales Act 
of 1946 (50 U.S.C. App. 1744), and shall not be traded out or sold 
from such reserve fleet, except as provided for in subsections (g) and 
(i) of this section. This limitation shall not affect the rights of the 
Secretary of Commerce to dispose of a vessel as provided in other 
sections of this title or in titles VII or X I of this Act." 
Approved October 10, 1965.