Jones Act & Maritime Law

The Jones Act — formally Section 27 of the Merchant Marine Act of 1920 (46 U.S.C. § 55102) — requires that goods transported between U.S. ports travel on vessels that are U.S.-built, U.S.-owned, U.S.-flagged, and U.S.-crewed. This cabotage law is one of the most consequential and contested protectionist statutes in American law: its defenders argue it maintains a domestic maritime industry essential for national security and preserves union maritime jobs; its critics — including economists across the political spectrum — argue it raises shipping costs for Hawaii, Alaska, Puerto Rico, and Guam, adds an estimated $1.5–3 billion/year in excess costs for Puerto Rico alone, and limits disaster-relief flexibility. Only about 80 Jones Act-eligible vessels operate in U.S. oceangoing coastal trade, a fraction of the fleet that existed when the law was enacted. The Jones Act also includes the seaman's injury provision (46 U.S.C. § 30104) — giving maritime workers employed on vessels a federal negligence cause of action against their employers, distinct from and generally more favorable than state workers' compensation. Beyond the Jones Act, U.S. maritime law encompasses admiralty jurisdiction, the Death on the High Seas Act, the Longshore and Harbor Workers' Compensation Act, and the Carriage of Goods by Sea Act — a comprehensive body of law governing commerce, injury, and liability on navigable waters.

Current Law (2026)

Legal Authority

• 46 U.S.C. § 55102 — Jones Act cabotage (merchandise transported by water between points in the United States must be transported in vessels built in and documented under the laws of the United States and owned by U.S. citizens; foreign-built, foreign-flagged, or foreign-owned vessels prohibited from domestic waterborne commerce)
• 46 U.S.C. § 12102-12112 — Vessel documentation (vessels operating in U.S. waters must be documented; coastwise endorsement required for domestic trade; requires U.S. ownership and, for coastwise trade, U.S. construction)
• 46 U.S.C. § 30104 — Jones Act seaman injury (seamen injured in the course of their employment may bring a civil action at law against their employer for damages for personal injury; employer is liable for negligence — a lower standard than workers' compensation; right to trial by jury; maintenance and cure obligations)
• 46 U.S.C. § 30301-30306 — Death on the High Seas Act (wrongful death action for deaths occurring on the high seas beyond 3 nautical miles; pecuniary damages; nonpecuniary damages available for commercial aviation accidents)
• 46 U.S.C. § 30505-30509 — Limitation of Liability Act (vessel owners may limit liability to the value of the vessel plus pending freight if the loss occurred without the owner's privity or knowledge — a unique admiralty protection)
• 46 U.S.C. § 55103-55121 — Additional coastwise trade provisions (passenger vessel restrictions, merchandise transport details, waivers for national defense, penalties for violations)
• 14 U.S.C. § 524 — Coast Guard enforcement of coastwise trade laws (Coast Guard enforces Jones Act cabotage requirements under Title 46 Chapter 551; Secretary must establish enforcement program)
• 14 U.S.C. § 1151 — Restriction on construction of vessels in foreign shipyards (Coast Guard vessels must be built in U.S. shipyards — a parallel domestic-build policy reinforcing the Jones Act's U.S.-build requirement for commercial vessels)
• 14 U.S.C. § 1153 — Prohibition on foreign shipyard overhaul/repair (Coast Guard vessels may not be overhauled, repaired, or maintained in foreign shipyards — maintaining the domestic maritime industrial base that the Jones Act policy framework protects)

How It Works

Maritime law (admiralty) is one of the oldest and most distinct areas of American law, with the Jones Act's cabotage requirement being the most economically significant and politically contested provision.

The cornerstone of the Jones Act is the cabotage requirement under 46 U.S.C. § 55102: all goods shipped by water between U.S. ports must travel on vessels that are (1) U.S.-built, (2) U.S.-owned (75%+ U.S. citizen ownership), (3) U.S.-flagged, and (4) U.S.-crewed (officers and 75% of crew must be U.S. citizens). This effectively reserves domestic waterborne commerce for the American maritime industry, applying to shipments between any U.S. points — including Alaska, Hawaii, Puerto Rico, Guam, and the U.S. Virgin Islands. The economic debate over this requirement is intense: supporters argue it preserves a domestic shipbuilding base critical for national defense and maintains skilled U.S. maritime jobs; critics argue that because U.S.-built vessels cost 5–8x more than foreign-built equivalents, the law raises consumer prices in noncontiguous territories by 15–20% and has reduced coastal shipping as a freight mode overall. With only about 80 Jones Act-eligible oceangoing vessels in operation today — a fraction of the fleet that existed when the law was enacted — repeated reform efforts have failed due to strong opposition from maritime unions and domestic shipbuilders.

Separate from the cabotage provision, the Jones Act also established a critical seaman injury right of action under 46 U.S.C. § 30104: maritime workers employed on vessels can sue their employers for negligence and recover full tort damages — pain and suffering, lost future earnings, and in some cases punitive damages — rather than being limited to state workers' compensation scheduled benefits. The seaman-status determination (who qualifies for this protection) is frequently litigated. Two additional doctrines layer on top: vessel operators owe injured seamen maintenance and cure — food, lodging, and medical treatment through recovery — regardless of fault; and if the vessel itself was unseaworthy, the owner may face strict liability. Beyond the Jones Act, U.S. maritime law includes the Limitation of Liability Act (46 U.S.C. §§ 30505–30509), which allows vessel owners to cap their total liability to the value of the vessel plus pending freight if the loss occurred without their privity or knowledge — a uniquely favorable protection unavailable in other areas of tort law. The Longshore and Harbor Workers' Compensation Act provides workers' compensation coverage for maritime workers (dock workers, harbor workers, shipbuilders) who don't qualify as seamen under the Jones Act standard. See Merchant Seamen Protections for additional crew welfare requirements.

How It Affects You

If you live in Hawaii, Alaska, Puerto Rico, or Guam: The Jones Act is the most direct and quantifiable federal policy affecting your cost of living. Because all goods shipped by sea between U.S. ports must use U.S.-built, U.S.-crewed vessels — which cost 5-8x more to build than foreign equivalents and operate at higher cost — virtually everything you buy that arrived by ship carries a Jones Act premium. The University of Puerto Rico Economic Research Group has estimated the Jones Act costs Puerto Rico $1.5-3 billion per year in excess shipping costs, or roughly $1,000-2,000 per household annually. In practice, the impact shows up in higher grocery prices, higher fuel prices, and higher prices for manufactured goods. For disaster relief: the Jones Act has been repeatedly criticized for slowing disaster response after hurricanes (Hurricane Maria, 2017) — when U.S. relief supplies at East Coast ports can't quickly reach Puerto Rico on available foreign-flagged ships. DHS has authority to issue Jones Act waivers "in the interest of national defense" but rarely does so quickly. If there's a disaster affecting your island, your governor or congressional delegation can formally request a Jones Act waiver from DHS. Whether and how quickly such waivers are granted is a political question as much as a legal one.

If you're a maritime worker who was injured on a vessel: Your legal rights are significantly better than those of workers in most other industries. Under the Jones Act seaman injury provision (46 U.S.C. § 30104), you can sue your employer directly for negligence — and recover full tort damages including medical expenses, lost wages, loss of future earning capacity, and pain and suffering — rather than being limited to state workers' compensation scheduled benefits. The negligence standard is favorable: courts have held that even slight employer negligence that contributed to the injury satisfies the Jones Act standard. Two additional doctrines stack on top: (1) Maintenance and cure — your employer owes you a daily living allowance (currently $10-$50/day depending on the vessel, though courts often require more) and payment of all medical expenses to treat your injury, regardless of fault, until you reach "maximum medical improvement." Denying maintenance and cure in bad faith can result in punitive damages. (2) Unseaworthiness — if the vessel itself was unseaworthy (improper equipment, dangerous conditions, unfit crew), the vessel owner may be strictly liable. If you're injured on a vessel, get to a maritime attorney before signing any settlement paperwork — maritime claims are frequently undervalued when workers don't understand their rights. Find maritime attorneys through the Maritime Law Association or your local plaintiffs' bar.

If you're a shipper, importer, or manufacturer that ships goods between U.S. ports: Your logistics strategy must account for Jones Act compliance. Shipping goods from the contiguous U.S. to Hawaii, Alaska, Puerto Rico, or other U.S. territories — or between any two U.S. ports — on a foreign-flagged vessel violates the Jones Act and can result in seizure of the merchandise plus civil penalties. With only about 80 Jones Act-eligible oceangoing vessels in operation, capacity constraints are real — especially for specialized cargo. Some shippers use alternative routing (sending goods through a foreign port, which may allow foreign vessel use but adds cost and time) or mode-shift to air freight or cross-country trucking rather than pay Jones Act ship rates. Energy companies face this acutely: there are essentially no Jones Act-compliant LNG (liquefied natural gas) tankers, meaning domestic LNG cannot be shipped by sea between U.S. ports — New England utilities that would prefer domestic LNG regularly import it from Trinidad and elsewhere instead.

State Variations

Maritime law is exclusively federal (under the Constitution's admiralty jurisdiction). However:

• State workers' compensation may apply to maritime workers who don't qualify as seamen (shore-side workers doing non-maritime work)
• State wrongful death statutes may apply in territorial waters (within 3 nautical miles)
• Some states have their own Jones Act-like provisions for intrastate waterways
• State environmental regulations apply to vessel operations in state waters alongside federal Coast Guard requirements

Implementing Regulations

The Coast Guard regulations implementing vessel documentation and Jones Act citizenship requirements live at 46 CFR Part 67 — Documentation of Vessels. Key provisions:

• § 67.1 — Purpose: a Certificate of Documentation is required for operating a vessel in certain trades (coastwise, fisheries), serves as evidence of U.S. vessel nationality under international law, and is a prerequisite for subjecting a vessel to a preferred mortgage — giving the mortgage federal-law priority over other maritime liens.
• § 67.11 — Foreign registry and transfer restriction: a documented vessel (or one last documented under U.S. law) may not be placed under foreign registry, operated under foreign authority, or sold/transferred to a non-citizen without prior Maritime Administration approval. Exceptions: vessels documented exclusively with a fishery or recreational endorsement may be transferred without MARAD approval.
• § 67.30 — Citizen ownership requirement: Certificates of Documentation may only be issued to vessels wholly owned by U.S. citizens. Limited exceptions under the Bowater Amendment (46 U.S.C. § 12118) and Oil Pollution Act (§ 12117) allow partial foreign ownership for registry-endorsed (international trade) vessels.
• § 67.31 — Stock and equity interest requirements: a non-citizen may not hold voting power, exercise control, or own stock or equity interest above the applicable threshold. Control means the right to direct business operations, replace the CEO or majority of directors, or direct vessel transfer or operations.
• § 67.33–67.39 — Citizenship definitions by entity type:
  • Individual: native-born, naturalized, or derivative U.S. citizen
  • Partnership: all general partners must be citizens; 75% equity required for coastwise or fishery endorsement, 50% for registry/recreational
  • Corporation: CEO, board chair, and no more than a minority of the quorum of directors may be non-citizens; 75% stock at each tier and in aggregate required for coastwise or fishery endorsement
  • Trust: all trustees and all beneficiaries with enforceable interests must be citizens; 75% equity at each tier for fishery or coastwise endorsement
  • Joint venture: all members must be citizens
• § 67.47 — Maritime Administration approval: any proposed sale to a non-citizen, foreign registry, or foreign operation requires advance MARAD approval under 46 CFR Part 221. A previously transferred and re-acquired vessel cannot be re-documented without evidence of prior MARAD approval.
• §§ 67.121, 67.123 — Vessel marking requirements: the official number (preceded by "NO.") must be permanently affixed in 3-inch block Arabic numerals on a visible interior structural hull part; the vessel's name must appear on the port bow, starboard bow, and stern in letters at least 4 inches high; the hailing port appears on the stern; recreational vessels may display name and hailing port together on the hull exterior.
• § 67.141 — Application: all documentation applications go to the National Vessel Documentation Center (Falling Waters, WV) using Form CG-1258; title evidence and mortgagee consent (Form CG-4593) required in applicable cases; vessel must be marked before the certificate is valid for operation.
• § 67.142 — Penalties: fishery endorsement violations carry civil penalties up to $10,000 per day; fishing vessels are subject to seizure and forfeiture for fraudulent applications, falsified information, or fishing in the EEZ after endorsement revocation.

Trade endorsements under Part 67 determine which trades a vessel is eligible for: coastwise (domestic trade between U.S. ports — requires U.S. build and 75% U.S. citizen ownership); fishery (commercial fishing in the U.S. EEZ — requires 75% citizen ownership at each ownership tier); registry (international trade — 50% citizen equity sufficient); and recreational (personal use). A vessel may hold multiple endorsements simultaneously.

• 46 CFR Part 68 — Waivers of navigation and vessel-inspection laws (§§ covering foreign-built vessels, coastwise trade restrictions, build requirements)

The MARAD administrative waiver process for small passenger vessels operates under a distinct set of regulations at 46 CFR Part 388 — Administrative Waivers of the Coastwise Trade Laws. Key provisions:

• § 388.3 — Eligibility: waivers are available only for passenger vessels carrying 12 or fewer passengers that are not eligible for coastwise trade due to foreign build or rebuild; authority derives from 46 U.S.C. § 12106 (P.L. 105-383)
• § 388.4 — Grant criteria: MARAD grants a waiver only if it determines that no qualified U.S.-flag vessel is available to meet the particular need and that granting the waiver will not cause economic harm to U.S. vessel operators competing in the same market
• § 388.5 — Revocation: waivers may be revoked at any time if the holder obtained them through fraud or misrepresentation, if the operating conditions materially change, or if a qualified U.S.-flag vessel becomes available; revocation is immediate without prior notice if the Secretary makes a fraud finding
• § 388.6 — Application fee and documentation: applicants must submit vessel specifications, ownership documentation, proposed route or operating area, and evidence of the unavailability of qualifying U.S. vessels

Part 388 waivers are the mechanism behind the February 2026 MARAD determinations referenced below and the wave of small eco-tourism and charter operators seeking to use foreign-built vessels in U.S. waters. Each waiver is vessel-specific and route-specific — a waiver to operate a foreign-built catamaran in Puget Sound does not authorize the same vessel on a Hawaii route. Because 46 U.S.C. § 12106 limits eligibility to ≤12-passenger vessels, large passenger vessels (cruise ships, ferries) must use the separate DHS national defense waiver authority or the MARAD determination process under 46 U.S.C. § 501. The 12-passenger ceiling also means Part 388 waivers are primarily relevant to small charter operators, whale-watching boats, fishing charters, and island ferry services — not commercial ocean shipping.

• 46 CFR Part 356 — Requirements for Vessels of 100 Feet or Greater in Registered Length to Obtain a Fishery Endorsement (MARAD, 26 sections — the citizenship verification framework for large commercial fishing vessels under the American Fisheries Act of 1998 (Title II of Pub. L. 105-377); authority: 46 U.S.C. § 12102; Part 356 implements the AFA's specific, more stringent citizenship requirements for Fishing Industry Vessels — commercial fishing vessels 100 feet or greater in registered length — that seek a fishery endorsement to their vessel documentation, allowing them to operate in the U.S. Exclusive Economic Zone (EEZ)):

  • § 356.1 — Purpose: Part 356 implements the citizenship requirements of the American Fisheries Act to prevent non-citizens from controlling large U.S.-flagged fishing vessels indirectly through complex ownership structures, financing arrangements, or management contracts — the exact mechanisms that had allowed foreign fishing interests to maintain effective control of large U.S. factory trawlers before the AFA's enactment; the AFA's backstory: in the 1990s, foreign fishing companies (primarily Norwegian and Japanese interests) had acquired effective control of large U.S.-flagged vessels in the Pacific pollock fishery by combining minority equity, management contracts, processing contracts, and debt covenants that gave them operational control without the 75% domestic ownership technically required by statute
  • § 356.11 — Impermissible control by a non-citizen: an impermissible transfer of control exists when a non-citizen exercises actual control over a Fishing Industry Vessel or its operations through any mechanism — including contractual rights, management agreements, charter arrangements, or loan covenants — even if the non-citizen holds less than 25% equity ownership; MARAD evaluates substance over form: a non-citizen with a 15% equity stake and contractual veto rights over major operating decisions exercises impermissible control; this provision closes the loophole that existed under simple equity percentage tests
  • § 356.13 — Information required to be submitted by vessel owners: to be eligible for a fishery endorsement under Part 356, the vessel owner must annually submit to MARAD a detailed ownership disclosure package including: (a) a current organizational chart showing every legal entity and individual in the ownership chain, with citizenship status of each; (b) identification of all mortgages, liens, and debt instruments secured by the vessel; (c) copies of all management agreements, charters, processing agreements, and contracts that could give any party operational control; and (d) certification under oath of compliance with all AFA requirements; the disclosure package is significantly more detailed than the standard vessel documentation citizenship requirements under Part 67
  • § 356.15 — Filing of affidavit of U.S. citizenship: new owners of Fishing Industry Vessels after October 1, 2001, must file an Affidavit of U.S. Citizenship with MARAD before operating the vessel under a fishery endorsement; the affidavit must be signed by a senior officer under penalty of perjury; re-filing is required whenever ownership or control arrangements change materially
  • § 356.17 — Annual requirements: every owner of a Fishing Industry Vessel must submit an annual certification to MARAD confirming continued compliance with citizenship requirements; the annual certification covers the vessel's ownership structure, any changes during the year, all debt instruments, and all operational agreements; the annual requirement ensures ongoing monitoring rather than one-time certification at documentation
  • § 356.19 — Requirements to hold a Preferred Mortgage: a lender seeking to hold a Preferred Mortgage on a Fishing Industry Vessel — the maritime equivalent of a first-position security interest that can be foreclosed in admiralty court — must qualify as a citizen under the AFA's ownership test; non-citizen lenders may not hold preferred mortgages on large fishing vessels; this provision prevents foreign lenders from obtaining control through foreclosure after structuring financing to place the vessel in default
  • §§ 356.21–356.23 — Standard loan and mortgage agreements: MARAD pre-approves certain standard loan covenants that lenders may include in Fishing Industry Vessel financing without triggering the impermissible control analysis; approved covenants include standard financial maintenance covenants (debt-to-equity ratios, minimum working capital) and operational restrictions (requiring vessel insurance, prohibiting transfer without lender consent); covenants going beyond the pre-approved list require MARAD review to determine whether they create impermissible non-citizen control
  • § 356.27 — Mortgage trustee requirements: a lender that does not qualify as a citizen under AFA standards may still participate in Fishing Industry Vessel financing by using an approved mortgage trustee — a U.S. citizen institution (typically a bank or trust company) that holds the preferred mortgage on the non-citizen lender's behalf; the trustee arrangement allows non-citizen lenders to extend credit for U.S. fishing vessel acquisitions while maintaining U.S. citizen control of the mortgage security; MARAD must approve the trustee arrangement before the mortgage is executed

  Part 356 is the most stringent maritime citizenship enforcement mechanism in U.S. law. The American Fisheries Act was enacted specifically because the existing Part 67 citizenship tests had proved inadequate to prevent effective foreign control of large U.S.-flagged fishing vessels in the high-value pollock and groundfish fisheries of the North Pacific — fisheries governed by quota allocations under the Magnuson-Stevens Fishery Conservation and Management Act. MARAD's enforcement is substantive: the agency reviews organizational charts, contracts, and financing documents to trace actual control, not just legal ownership percentages. Violations can result in denial or revocation of the fishery endorsement — which terminates the vessel's right to fish in the EEZ. No major Part 356 amendments since 2003 (68 FR 59167) — the AFA citizenship framework has been stable.

• 46 CFR Part 30–40 — Marine engineering and tank vessels (vessel construction, safety equipment, manning for domestic trade vessels)

• 46 CFR Part 117–185 — Small passenger vessels and passenger vessels (construction, stability, fire protection for coastwise service)

Pending Legislation

• HR 4839 — Merchant Marine Allies Partnership Act. Allows vessels from allied nations to participate in coastwise trade under specified conditions, partially relaxing the Jones Act's U.S.-build requirement. Status: Introduced.
• HR 2429 — Merchant Marine Academy Modernization Act. Authorizes $1 billion for modernization of the U.S. Merchant Marine Academy facilities and programs. Status: Introduced.
• HR 39 — Original Honoring WWII Merchant Mariners Act. Provides $25,000 payments to surviving World War II merchant mariners in recognition of their service. Status: Introduced.

Recent Developments

• The Jones Act continues to be debated, particularly in the context of Puerto Rico's economic challenges and Hawaii's cost of living

• Jones Act waivers have been issued during hurricane emergencies and fuel supply crises, highlighting the tension between the law and disaster response

• The declining U.S.-flagged fleet raises questions about whether the Jones Act achieves its national defense objectives

• Offshore wind energy development has created new Jones Act compliance questions regarding wind turbine installation vessels

• In February 2026, MARAD published multiple requests for determination regarding the use of foreign-built small passenger vessels in U.S. coastwise trade under the Jones Act, reflecting continued demand for coastwise trade waivers.

• In February 2026, the Federal Register published a final rule rescinding regulations regarding priority and allocation rules for port utilization, eliminating Cold War-era provisions that had authorized government direction of port operations during national emergencies.