Jones Act and Other U.S. Maritime Cabotage Laws

GOAL: Strict adherence to the Jones Act and all existing maritime cabotage laws, as they play a crucial role in America’s national, homeland, and economic security.

BACKGROUND: Section 27 of the 1920 Merchant Marine Act, generally referred to as the Jones Act, mandates that all cargo moving between U.S. points be carried in vessels that are crewed by, built by, and owned by Americans. Other laws and statutes apply the same ground rules to carrying passengers, towing, dredging, and salvaging in U.S. waters.

The U.S. is far from unique in reserving its domestic waterborne commerce to its domestic fleets. Eighty percent of the world’s coastlines of United Nations shipping nations have similar cabotage laws for their domestic maritime commerce.

ECONOMIC BENEFITS: The American Great Lakes states’ maritime industry, operating under the Jones Act, contributes 123,600 jobs and an annual economic impact of more than $30 billion, 20% of the national economic impact. Cabotage laws ensure the U.S. has the ships, skilled mariners, and shipyards needed to supply American troops during a national emergency. The U.S. Navy terms the law “vital to our National Security.” In addition, the presence of an American fleet provides important homeland security benefits.

The Jones Act, first and foremost, guarantees that domestic waterborne commerce is carried in vessels built to the world's highest safety and environmental protection standards with crews whose skills and expertise are certified by the U.S. Coast Guard. Further, by guaranteeing a level playing field among the various transportation modes, Great Lakes Jones Act operators have been able to assemble the world’s largest and most diverse fleet of self-unloading vessels without one penny of federal subsidies. Our cargoes keep the mills producing steel for U.S.-made autos and appliances, the lights on in southeast Michigan, and workers on the job building U.S. infrastructure.

ACTION: With the Jones Act marking its 100th anniversary in 2020, GLMTF opposes any legislation to amend or repeal this fundamental law of the American maritime industry and related laws; opposes blanket waivers such as those instituted following hurricanes Harvey, Irma, and Maria in 2017; and opposes inclusion of changes to the Jones Act in any trade agreements. While exemptions to the Jones Act are allowed during national emergencies, peacetime exemptions for commercial vessels must not be permitted. If an economically viable trade develops that requires a new type of U.S.-flag vessel, there will be fierce competition for the American commercial marketplace without changing the cabotage laws.