Posted on 10/26/2020 10:54:35 AM PDT by SJackson
For over 100 years, U.S. legislation called The Jones Act has dictated that only American-owned, crewed, registered and built ships can transport cargo between U.S. ports.
An even older law — the Passenger Vessel Services Act of 1886 — bans foreign-registered ships from transporting passengers between ports in the U.S.
How do these rules impact the cruise industry? Quite significantly.
The Jones Act was passed as part of the Merchant Marine Act of 1920 and justified on national security grounds as a way of boosting the U.S. maritime industry.
Folded into the Jones Act is much of the content of the 1886 Passenger Vessel Services Act (PVSA). This is the part that really impacts the cruise industry.
The PVSA reads in part:
No foreign vessels shall transport passengers between ports or places in the United States, either directly or by way of a foreign port, under a penalty of $200 [now $778] for each passenger so transported and landed.
This means that ships of non-U.S registry are barred from taking on and debarking guests at two different U.S ports. An example is that a cruise ship can not sail non-stop from New York to Miami.
But there are some exemptions that relate to the cruise industry:
Foreign-flagged ships can depart from and return to the same U.S. port, provided there’s a stop in between at a foreign port. An example is an Alaska cruise out of Seattle, which can stop at Alaskan ports provided a stop is made in Vancouver or another Canadian west coast port before returning to Seattle. Foreign-flagged ships can depart from a U.S. port, stop at a ‘distant’ foreign port, and then continue to a second U.S. port. But to qualify for the exemption they must visit a port outside of North America and the Caribbean. For example, a cruise departing New York and circumnavigating South America, with stops on that continent, can then send passengers home from Los Angeles.
The only current large oceangoing cruise ship to fly the flag of U.S. registration is Norwegian Cruise Line’s Pride of America, which offers multiple-stop cruises in the Hawaiian islands. It was inaugurated in 2005 as the first new U.S.-flagged cruise ship in nearly fifty years.
Pride of America was partially built in Mississippi, with significant federal subsidies, and completed in Germany. It still required a special federal exemption to attain U.S. registration.
As a U.S.-flagged ship, Pride of America is subject to American labor laws and staffed by a mostly American crew, in contrast to the vast majority of cruise ships.
How Do These Laws Impact Cruise Ships?
While many of the major cruise brands are American-owned, the vast majority of ships are registered in other countries — meaning they are “foreign-flagged.”
Under international law, all merchant ships must be part of a registry created by a country, and ships are subject to the laws of the country where they are registered.
Although the practice is now common around the world, it is often contentious. Vessels registered in places like the Bahamas, Panama, Liberia and Malta are often referred to negatively as flying “flags of convenience.” To have a cruise ship flagged in the United States, it must be built, owned, and crewed by Americans.
The modern practice of ships being registered in a foreign country began in the U.S. in the 1920s, when shipowners who wanted to serve alcohol to passengers during Prohibition began registering vessels in Panama.
They soon discovered other advantages, including less-burdensome regulations as well as lower taxes and labor costs. As a result, many continued to register their ships in Panama and elsewhere long after Prohibition ended.
The rise of river cruising in the U.S. has breathed some new life into American shipbuilding and created American crew jobs, as those ships must be U.S.-registered in order to stop at multiple domestic ports.
For cruise lines, one drawback of foreign-flagging was demonstrated earlier this year, when some argued that the companies should not qualify for government assistance during the global health crisis because they had chosen to register their ships abroad.
Despite suffering massive losses due to the industry shutdown, the major lines have had to find ways to secure their own financing in order to stay afloat until they can once again begin generating revenue.
Restarting and Saving The Cruise Industry As the United States cruise industry prepares for a safe relaunch, some aspects of what many consider to be archaic legislation may need to be reexamined.
This may become a larger issue in 2021, as the Canadian government currently bans all cruise ships carrying over 100 persons (passengers and crew) from operating within its waters. There’s no word yet on whether Canada will lift that restriction prior to the start of the 2021 Alaska cruise season next April.
‘Cruises to nowhere’ could be one way of offering a vacation while limiting the exposure of passengers to others. And East Coast foliage cruises that stop only at U.S. ports might be a solution if Canada continues to restrict entry.
Asia and Europe are bending the rules to get cruise ships sailings again, will the United States?
Operating costs such as US crews are a problem but the fact that a US flagged ship must be American made is a killer. Many shipyards, but 5 dominate the manufacturing side of the industry. A chicken or egg situation, given the dominant shipyards are outside the US. Germany, Finland, Japan, France, no reason we can’t compete.
ping
Getting rid of the Jones Act has been a push since it was passed. It’s almost like the getting rid of the 2nd amendment.
Chinese and Mexican ships taking over our domestic trade? No Thanks
The Jones Act kept me from doing B2B Alaska and then Hawaii for years...
We couldnt leave Seattle and go to Vancouver and then leave Vancouver and go to Hawaii ..
I wanted to fly out once and do both...
Finally last year I was able to do Vancouver to Vancouver and then to LA through Hawaii...
“Chinese and Mexican ships taking over our domestic trade? No Thanks”
They already have. We don’t build merchant ships any more and they are not registered here.
The act actually killed the US non-military ship building industry
With Guam. Asian airliners have to return rather than fly on to Hawaii/West coast. Lost tourism. Worried the island will fall over.
The rationale even at the time was the importance of a private shipbuilding capability in the US. Over the last 25 years (and longer) US private shipbuilding has collapsed. I’d note, for US flagging construction can be separated from crew nationality requirements.
“The act actually killed the non-military ship building industry”
No. If not for the Act, almost all of the coastal tankers, freighters, tugs and barges, oil rigs and other craft now made in the US’s 83 shipyards would be built elsewhere.
When Will I Be Cruising
I’ve been cancelled, been mistreated
When will I be cruising
I’ve been masked up, I’ve been pushed ‘round
When will I be cruising
When I find a new cruise that I want for mine
Its cancelled in a month or two, it happens every time
I’ve been made blue, I’ve been lied to
When will I be cruising
When I find a new cruise that I want for mine
Its cancelled in a month or two, it happens every time
I’ve been cancelled, been mistreated
When will I be cruising
When will I be cruising
Tell me when will I be cruising
From When Will I be loved Linda Ronstadt
I am unfamiliar with the history of the Jones Act and its possible consequences, so this is just a personal comment. The US is a two ocean country, and so needs a two ocean navy. However, the Navy alone cannot adequately defend our shores, or project power overseas, without the support of the Merchant Marine, who in the past have behaved with the same exemplary patriotism and bravery as those in uniform. I believe the overriding consideration is to support them and keep them strong.
Read Alfred Thayer Mahan, “The Influence of Sea Power upon History”.
REPEAL the part of the JONES ACT so we can have AMERIcan cruises!!!!
DO YOU KNOW OF ANY MEXICAN SHIPS??? One of the Chinese ships are CRYSTAL CRUISES!! I’ll take it!!
Screw ‘em
American flagged, American Crew or they can suck water all the way to the bottom.
That would make sense. There’s no reason we can’t establish a private shipbuilding industry in the US. There’s no reason a ship should have to stop in Canada to travel to Alaska. Ships stopping in the US are subject to Coast Guard inspections/standards which should eliminate the concern about “third world ships”.
Screw those 175,000 to 250,000 Americans employed in the industry too. Won’t worry about the Americans working at American shipyards, those jobs are long gone. Would you advocate the same change for airlines?
Why should Americans care if foreign-owned cruise lines go bankrupt? It’s not an essential transportation service like airlines. I like to take cruises, but if I can’t any more that’s life.
Bingo. Foreign owned cruise lines, foreign made ships and almost completely foreign crewed. Where’s the problem?
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