NIT LEAGUE REQUESTS WAIVER FROM JONES ACT FOR WEST COAST CARRIERS

NIT LEAGUE REQUESTS WAIVER FROM JONES ACT FOR WEST COAST CARRIERS    The U.S. National Industrial Transportation League has asked the U.S. Customs Service to grant ocean carriers a waiver from the Jones Act to allow them to move stranded containers along the U.S. West Coast for a limited period.
   “The extraordinary circumstances created by the closure of West Coast ports prompted the League… to call upon the U.S. Customs Service to grant a limited exemption to the Jones Act,” the League said.
   The Jones Act prohibits foreign-flagged vessels to engage in the coastwise movement of cargo between U.S. ports.
   However, transpacific carriers and shippers are now facing serious problems caused by the West Coast port dispute, as thousands of containers were discharged at the wrong port by carriers to avoid vessels getting caught in lengthy port delays.
   Hyundai Merchant Marine, of South Korea, and other non-U.S. carriers, are believed to have asked for permission to move containers between U.S. West Coast ports, but their requests were turned down.
   In a letter sent Wednesday to U.S. Customs Commissioner Robert Bonner, NIT League president Ed Emmett said the 10-day port closure has led to significant congestion, stranded thousands of containers, and threatened the economic health of many businesses.
   To help alleviate these conditions, Emmett asked Bonner, “to allow for a period of 90 days, foreign-flagged vessels to engage in coastwise movement of cargo between U.S. West Coast ports.”    He noted that in granting this exemption, increased coastwise transportation, “could effectively supplement land-based systems in moving containers to where they are needed.”
   Stranded containers could be moved between the West Coast ports by water, rail, or truck, but rail and truck capacities are seen as limited, and the existing rail and truck infrastructure may not be adequate.
   “This temporary waiver will not impair the long-term goal behind the coastwise rule, and the health of the U.S. commercial fleet will not be harmed by this proposed waiver,” Emmett said. He added that the U.S.-flag fleet “cannot even come close” to meeting the current coastwise demand.
   The NIT League believes that the temporary waiver of the coastwise rule would help American industries, facilitate trade, and protect American workers from layoffs due to supply chain interruptions.
   Emmett also told U.S. Customs that congestion has continued since the lockout ended on Oct. 9, and “the ongoing effects of the port closure has created a bottleneck that shows no signs of abating anytime soon.”
   “A massive stream of ships arrive at West Coast ports daily,” he warned. “With the continued congestion affecting our economy and national defense, the National Industrial Transportation League urges you to consider a temporary waiver of the Jones Act prohibition on coastwise movement of cargo by foreign-flagged vessels.”
   Hundreds of foreign-flagged vessels are already moving between West Coast ports, “making a temporary waiver a simple and workable response to a difficult problem,” the NIT League argued.
   Under the Jones Act, a waiver can be granted in times of national defense.
   The NIT League said that port facilities are so physically congested with vessels and containers that the free movement of military goods may be compromised. At the last count 69 commercial vessels were at anchor outside Los Angeles/Long Beach, simply waiting to dock.
   In announcing his decision to invoke the Taft-Hartley Act earlier this month, President Bush said that the lockout at West Coast ports “threatens our national defense.”
   However, the U.S. Maritime Administration recently said that the Jones Act must be upheld. MarAd wrote to U.S. Customs to say that it did not believe that the current circumstances met the definition of the interest of national defense.