Collapse to view only § 56102. Additional controls during war or national emergency
- § 56101. Approval required to transfer vessel to noncitizen
- § 56102. Additional controls during war or national emergency
- § 56103. Conditional approvals
- § 56104. Penalty for false statements
- § 56105. Forfeiture procedure
§ 56101. Approval required to transfer vessel to noncitizen
(a)Restrictions.—
(1)In General.—Except as otherwise provided in this section, section 12119 of this title, or section 611 of the Merchant Marine Act, 1936, a person may not, without the approval of the Secretary of Transportation—
(A) sell, lease, charter, deliver, or in any other manner transfer, or agree to sell, lease, charter, deliver, or in any other manner transfer, to a person not a citizen of the United States, an interest in or control of—
(i) a documented vessel owned by a citizen of the United States; or
(ii) a vessel last documented under the laws of the United States; or
(B) place under foreign registry, or operate under the authority of a foreign country, a documented vessel or a vessel last documented under the laws of the United States.
(2)Exceptions.—Paragraph (1)(A) does not apply to a vessel that has been operated only for pleasure or only as a fishing vessel, fish processing vessel, or fish tender vessel (as defined in section 2101 of this title).
(b)Approval Before Documentation.—To promote financing with respect to a vessel to be documented under chapter 121 of this title, the Secretary may grant approval under subsection (a) before the vessel is documented.
(c)Exceptions.—Notwithstanding any other provision of this subtitle, the Merchant Marine Act, 1936, or any contract with the Secretary made under this subtitle or that Act, a person may place a vessel under foreign registry without the approval of the Secretary if—
(1)
(A) the Secretary, in conjunction with the Secretary of Defense, determines that at least one replacement vessel of equal or greater military capability and of a capacity that is equivalent or greater, as measured by deadweight tons, gross tons, or container equivalent units, as appropriate, is documented under chapter 121 of this title by the owner of the vessel placed under foreign registry; and
(B) the replacement vessel is not more than 10 years old on the date of that documentation; or
(2) an operating agreement covering the vessel under chapter 531 of this title has expired.
(d)Status of Prohibited Transaction.—A charter, sale, or transfer of a vessel, or of an interest in or control of a vessel, in violation of this section is void.
(e)Penalties.—
(1)Criminal penalty.—A person that knowingly sells, charters, or transfers a vessel, or an interest in or control of a vessel, in violation of this section shall be fined under title 18, imprisoned for not more than 5 years, or both.
(2)Civil penalty.—A person that sells, charters, or transfers a vessel, or an interest in or control of a vessel, in violation of this section is liable to the United States Government for a civil penalty of not more than $10,000 for each violation.
(3)Forfeiture.—A documented vessel may be seized by and forfeited to the Government if, in violation of this section, a person—
(A) knowingly sells, charters, or transfers the vessel or an interest in or control of the vessel; or
(B) places the vessel under foreign registry or operates the vessel under the authority of a foreign country.
(f)Foreign Vessel Charters for Passenger Vessels.—The Maritime Administrator shall make publicly available on an appropriate website of the Maritime Administration—
(1) a detailed summary of each request for a determination, approval, or confirmation that a vessel charter for a passenger vessel is encompassed by the general approval of time charters issued pursuant to this section or regulations prescribed pursuant to such section; and
(2) the final action of the Administration with respect to such request, after the provision of notice and opportunity for public comment.
(Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1651; Pub. L. 118–31, div. C, title XXXV, § 3514(b)(2), (3), Dec. 22, 2023, 137 Stat. 810.)
§ 56102. Additional controls during war or national emergency
(a)In General.—During war, or a national emergency declared by Presidential proclamation, a person may not, without the approval of the Secretary of Transportation—
(1) place under foreign registry a vessel owned in whole or in part by a citizen of the United States or a corporation incorporated under the laws of the United States or of a State;
(2) sell, mortgage, lease, charter, deliver, or in any other manner transfer, or agree to sell, mortgage, lease, charter, deliver, or in any other manner transfer, to a person not a citizen of the United States—
(A) a vessel owned as described in paragraph (1), or an interest therein;
(B) a vessel documented under the laws of the United States, or an interest therein; or
(C) a facility for building or repairing vessels, or an interest therein;
(3) issue, assign, or transfer to a person not a citizen of the United States an instrument of indebtedness secured by a mortgage of a vessel to a trustee, by an assignment of an owner’s interest in a vessel under construction to a trustee, or by a mortgage of a facility for building or repairing vessels to a trustee, unless the trustee or a substitute trustee is approved by the Secretary under subsection (b);
(4) enter into an agreement or understanding to construct a vessel in the United States for, or to be delivered to, a person not a citizen of the United States without expressly stipulating that construction will not begin until after the war or national emergency has ended;
(5) enter into an agreement or understanding whereby there is vested in, or for the benefit of, a person not a citizen of the United States the controlling interest in a corporation that is incorporated under the laws of the United States or a State and that owns a vessel or facility for building or repairing vessels; or
(6) cause or procure a vessel, constructed in whole or in part in the United States and never cleared for a foreign port, to depart from a port of the United States before it has been documented under the laws of the United States.
(b)Trustees.—
(1)Approval.—The Secretary shall approve a trustee or substitute trustee under subsection (a)(3) if and only if the trustee is a bank or trust company that—
(A) is organized as a corporation, and is doing business, under the laws of the United States or a State;
(B) is authorized under those laws to exercise corporate trust powers;
(C) is a citizen of the United States;
(D) is subject to supervision or examination by Federal or State authority; and
(E) has a combined capital and surplus (as set forth in its most recent published report of condition) of at least $3,000,000.
(2)Disapproval.—If a trustee or substitute trustee ceases to meet the conditions in paragraph (1), the Secretary shall disapprove the trustee or substitute trustee. After the disapproval, the restrictions on transfer or assignment without the Secretary’s approval in subsection (a)(3) apply.
(3)Operation of vessel.—During a period when subsection (a) applies, a trustee referred to in subsection (a)(3), even though approved as a trustee by the Secretary, may not operate the vessel under the mortgage or assignment without the Secretary’s approval.
(c)Status of Prohibited Transaction.—A transaction in violation of this section is void.
(d)Recovery of Consideration.—
(1)In general.—A person that deposited or paid consideration in connection with a transaction prohibited by this section may recover the consideration after tender of the vessel, facility, stock, or other security, or interest therein, to the person entitled to it, or the forfeiture thereof to the United States Government.
(2)Exception.—Paragraph (1) does not apply if the person in whose interest the consideration was deposited, or to whom it was paid, entered into the transaction in the belief that the person depositing or paying the consideration was a citizen of the United States.
(e)Penalties.—
(1)Criminal penalty.—A person that violates, or attempts or conspires to violate, this section shall be fined under title 18, imprisoned for not more than 5 years, or both.
(2)Forfeiture.—The following shall be forfeited to the Government:
(A) A vessel, a facility for building or repairing vessels, or an interest in a vessel or such a facility, that is sold, mortgaged, leased, chartered, delivered, transferred, or documented, or agreed to be sold, mortgaged, leased, chartered, delivered, transferred, or documented, in violation of this section.
(B) Stock and other securities sold or transferred, or agreed to be sold or transferred, in violation of this section.
(C) A vessel departing in violation of subsection (a)(6).
(Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1652.)
§ 56103. Conditional approvals
(a)In General.—In approving an act or transaction under section 56101 or 56102 of this title, the Secretary of Transportation may do so absolutely or upon conditions the Secretary considers advisable. The Secretary shall state the conditions in the notice of approval.
(b)Violations.—A violation of a condition of approval is subject to the same penalties as a violation resulting from an act done without the required approval. The violation occurs at the time the condition is violated.
(Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1654.)
§ 56104. Penalty for false statements
A person that knowingly makes a false statement of a material fact to the Secretary of Transportation or another officer, employee, or agent of the Department of Transportation, to obtain the Secretary’s approval under section 56101 or 56102 of this title, shall be fined under title 18, imprisoned for not more than 5 years, or both.
(Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1654.)
§ 56105. Forfeiture procedure
(a)In General.—A forfeiture under this chapter may be enforced in the same way as a forfeiture under the laws on the collection of duties. However, such a forfeiture may be remitted without seizure of the vessel.
(b)Prior Convictions.—In a proceeding under this chapter to enforce a forfeiture, a prior criminal conviction of a person for a violation of this chapter with respect to the subject matter of the forfeiture is prima facie evidence of the violation against the person convicted.
(Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1654.)