News / US Maritime Fears Waiver Abuse

US Maritime Fears Waiver Abuse

01 November 2022 - by - in Industry News
US Maritime Fears Waiver Abuse

large cargo ship on water

The Jones Act has been around since the 1920s and it is no stranger to controversy. Recent waivers passed by the Biden Administration have loosened the restrictions imposed by the Jones Act. What are some of the proponents and opponents saying about these waivers and how can they impact your business?

How Waivers Have Changed the Jones Act

In light of certain global and domestic events, President Biden and his administration have issued several waivers, greatly weakening the Jones Act. For example, after Hurricane Fiona, new waivers allowed foreign tankers to operate in Puerto Rican ports, something previously not allowed under the Jones Act. 

The idea of these waivers is to help improve shipping across the United States, as there seems to be an endless shortage of tankers. Tropical storms and hurricanes can exasperate this issue, as can a worldwide pandemic. Of course, there are proponents and opponents to these waivers, with many within the U.S. maritime industry fearing waiver abuse. 

What Exactly is the Jones Act?

The Jones Act was passed in 1920, following the end of World War One. The idea behind the act was to strengthen the American shipping industry. This law requires any cargo traveling by sea between two U.S. ports to sail on an American-owned ship that was built in the United States and crewed by a majority of United States citizens. 

Over the years, the Jones Act has been credited with creating over 600,000 jobs within the shipping industry while also providing $150 billion in economic activity. Changes to the Jones Act will, in theory, weaken the U.S. shipping industry. 

What Are Proponents Saying?

Those who support the temporary waivers believe it’s important to ensure Puerto Rico and the United States are able to get the supplies they need during a time of crisis. By loosening restrictions imposed by the Jones Act, foreign tankers are allowed to enter Puerto Rican ports, providing oil and other much-needed supplies. 

This takes a further load off an already taxed American shipping industry that is still picking up the pieces after the pandemic. By doing so, proponents believe shipping times will vastly improve across the country. The price of shipping in Puerto Rico will also dramatically decrease, allowing them the opportunity to properly rebuild without having to worry about crippling costs. 

What Are Opponents Saying?

There are some who believe waivers have been abused in recent years. Companies who have been granted these waivers, most of who are not named, can take advantage by simply loading cargo onto foreign vessels rather than using the chartered American vessels that are available. 

Others believe that this will weaken the American shipping industry. Relying on foreign vessels can often be an unpredictable process. Rather than use the waiver as an opportunity to help Americans, shipping companies often maneuver in a way that benefits them and only them. 

How Can This Impact Your Business?

Changes to the Jones Act and disruptions in the supply chain are par for the course when it comes to the logistics industry. It is a very unpredictable industry that oftentimes feels as if it’s a house of cards, ready to collapse at a moment’s notice. 

Relaxing the Jones Act could potentially help your business, however, as there are more shipping options to choose from. This competition could lower shipping prices while also increasing shipping times. 

Do You Need Help With Your Logistics

If you don’t want to deal with the stress of the logistics industry, our team at Trifecta Transport is here to help. We deal with your time-critical logistics so you don’t have to worry about the unpredictability of the shipping industry. Contact us today to find out how we can help you with your shipping needs!