§53310 — Title 46 Shipping | U.S. Code

Summary

A deposit put into a construction reserve fund only qualifies if, within 3 years after the deposit (including any extensions the Secretary of Transportation allows), one of two things happens. Either a contract is made for a new vessel (or part interest, or rebuilding of a new vessel) with the Secretary’s approval, the deposit is used or promised for that contract, at least 12.5% of the vessel’s contract price is paid or firmly promised, and the Secretary approves the vessel plans as needed; or the deposit is used or promised to pay off purchase-money debt to a lender who is not the mortgagor’s parent, affiliate, or associated company. If the vessel is not built under a construction-differential-subsidy contract and was not bought from the Secretary, at least 5% of the first vessel’s construction must be finished within 6 months after the construction contract (as estimated by the Secretary and certified to the Secretary of the Treasury), and work must continue with reasonable speed after that. The Secretary of Transportation may extend the deadlines, but extensions for spending deposits cannot total more than 2 years, and extensions for reaching 5% construction cannot total more than 1 year.

Title 46, §53310

Shipping — Source: USLM XML via OLRC

(a)section 53306 and 53309 of this title apply to a deposit in a construction reserve fund only if, within 3 years after the date of the deposit (and any extension under subsection (c))—

(1)(A)a contract is made for the construction or acquisition of a new vessel or, with the approval of the Secretary of Transportation, for a part interest in a new vessel or for the reconstruction or reconditioning of a new vessel;

(B)the deposit is expended or obligated for expenditure under that contract;

(C)at least 12.5 percent of the construction or contract price of the vessel is paid or irrevocably committed for payment; and

(D)the plans and specifications for the vessel are approved by the Secretary to the extent the Secretary considers necessary; or

(2)the deposit is expended or obligated for expenditure for the liquidation of existing or subsequently incurred purchase-money indebtedness to a person not a parent company of, or a company affiliated or associated with, the mortgagor on a new vessel.

(b)In addition to the requirements of subsection (a)(1), for a vessel not constructed under a construction-differential subsidy contract or not bought from the Secretary of Transportation—

(1)at least 5 percent of the construction (or, if the contract covers more than one vessel, at least 5 percent of the construction of the first vessel) must be completed within 6 months after the date of the construction contract (or within the period of an extension under subsection (c)), as estimated by the Secretary and certified by the Secretary to the Secretary of the Treasury; and

(2)construction under the contract must be completed with reasonable dispatch thereafter.

(c)The Secretary of Transportation may grant extensions of the period within which the deposits must be expended or obligated or within which the construction must have progressed to the extent of 5 percent completion under this section. However, the extensions may not be for a total of more than 2 years for the expenditure or obligation of deposits or one year for the progress of construction.

Notes & Related Subsidiaries

Historical and Revision Notes

Revised SectionSource (U.S. Code)Source (Statutes at Large) 53310(a)46 App.:1161(g) (less (1)(B)).June 29, 1936, ch. 858, title V, § 511(g), (h), as added Oct. 10, 1940, ch. 849, 54 Stat. 1107; June 17, 1943, ch. 130, subdivs. (c), (d), 57 Stat. 158; July 17, 1952, ch. 939, §§ 12, 13(a), 66 Stat. 763; Pub. L. 86–237, § 1, Sept. 8, 1959, 73 Stat. 471; Pub. L. 87–303, § 3, Sept. 26, 1961, 75 Stat. 661; Pub. L. 87–782, § 1, Oct. 10, 1962, 76 Stat. 796; Pub. L. 88–227, § 1, Dec. 23, 1963, 77 Stat. 470; Pub. L. 88–595, § 1, Sept. 12, 1964, 78 Stat. 943; Pub. L. 97–31, § 12(92), Aug. 6, 1981, 95 Stat. 161. 53310(b)46 App.:1161(g)(1)(B). 53310(c)46 App.:1161(h). In this section, the language about joint

Regulations

in 46 App. U.S.C. 1161(g) and (h) is omitted as unnecessary because of section 53302(b) of the revised title. In subsection (a), the words “(i) two years from the date of deposit or the date of any extension thereof which may be granted by the Secretary of Transportation pursuant to the provisions of subsection (h) of this section, in the case of deposits made prior to the date on which these amendatory provisions become effective, or” in 46 App. U.S.C. 1161(g)(1) and (2) are omitted as obsolete. In paragraph (1)(A), the words “or, with the approval of the Secretary of Transportation, for a part interest in a new vessel or for the re

Construction

or reconditioning of a new vessel” are substituted for “(or in the discretion of the Secretary of Transportation, for a part interest therein), or, with the approval of the Secretary of Transportation, for the re

Construction

or reconditioning of a new vessel or vessels” to eliminate unnecessary words. In subsection (c), the proviso in 46 App. U.S.C. 1161(h) is omitted as obsolete.

§53310 Obligation of deposits and period for construction of certain vessels

Summary

Title 46, §53310

Notes & Related Subsidiaries

Historical and Revision Notes

Regulations

Construction

Construction

Citations & Metadata