U.S. Coast Guard Clarifies Jones Act Vessel Construction Requirements

The U.S. Coast Guard issued a ruling on August  27, 2014 to the Aker Philadelphia Shipyard, Inc. regarding the use of foreign-manufactured items in Jones Act tank vessels to be constructed at Aker. U.S. law requires that all “major components” of the hull and superstructure of a vessel be fabricated in the U.S. and that the vessel be assembled entirely in the United States to qualify for the Jones Act trade. In the past, the Coast Guard has indicated that a number of modules, sub-assemblies, equipment, and outfitting, all of which would be self-supporting and independent of the vessel’s structure, are not components of the hull and superstructure, and therefore can be manufactured abroad. In the most recent ruling, the Coast Guard also affirmed that an on-deck ballast water treatment system would not form part of the vessel’s hull and superstructure and so could be foreign manufactured without consideration of whether it is a “major component.”