46 U.S.C. § 53407 — National security requirements

Page 423 TITLE 46—SHIPPING § 53407 (D) $8,839,000 for each of fiscal years 2031 and 2032; (E) $9,078,000 for each of fiscal years 2033 and 2034; (F) $9,323,000 for each of fiscal years 2035 and 2036; (G) $9,574,000 for each of fiscal years 2037 and 2038; and (H) $9,833,000 for each of fiscal years 2039 and 2040. (2) TIMING.—The amount payable to a pro- gram participant under paragraph (1) for a fis- cal year shall be paid in 12 equal monthly in- stallments at the end of each month during that fiscal year. The amount payable for any fiscal year may not be reduced except as pro- vided by this section or section 51307(b). (b) CERTIFICATION REQUIRED FOR PAYMENT.—As a condition of receiving payment under this sec- tion for a fiscal year for a vessel, the program participant shall certify, in accordance with reg- ulations issued by the Secretary, that the vessel has been and will be operated in accordance with section 53405(a) of this title for at least 320 days during the fiscal year. Days during which the vessel is drydocked, surveyed, inspected, or re- paired shall be considered days of operation for purposes of this subsection. (c) GENERAL LIMITATIONS.—The Secretary may not make any payment under this chapter for a vessel with respect to any days for which the vessel is— (1) not operated or maintained in accordance with an operating agreement under this chap- ter; (2) more than 20 years of age; or (3) simultaneously operating under an agree- ment pursuant to chapter 531 of this title. (d) REDUCTIONS IN PAYMENTS.—With respect to payments under this chapter for a vessel covered by an operating agreement, the Secretary— (1) except as provided in paragraph (2), may not reduce such a payment for— (A) the operation of the vessel to carry military or other preference cargoes under section 55302(a), 55304, 55305, or 55314 of this title, section 2631 of title 10, or any other cargo preference law of the United States; or (B) any days in which the vessel is oper- ated under charter to the United States Gov- ernment; (2) may not make such a payment for any day that the vessel is engaged in transporting more than 7,500 tons of civilian bulk pref- erence cargoes pursuant to section 55302(a), 55305, or 55314 of this title; and (3) shall make a pro rata reduction for each day less than 320 in a fiscal year that the ves- sel is not operated in accordance with section 53405 of this title. (e) LIMITATIONS REGARDING NONCONTIGUOUS DOMESTIC TRADE.— (1) IN GENERAL.—No program participant shall receive payments pursuant to this chap- ter during a period in which it participates in noncontiguous domestic trade. (2) LIMITATION ON APPLICATION.—Paragraph (1) shall not apply to a program participant that is a citizen of the United States within the meaning of section 50501 of this title, ap- plying the 75 percent ownership requirement of that section. (3) PARTICIPATES IN A NONCONTIGUOUS TRADE DEFINED.—In this subsection the term ‘‘par- ticipates in a noncontiguous domestic trade’’ means directly or indirectly owns, charters, or operates a vessel engaged in transportation of cargo between a point in the contiguous 48 States and a point in Alaska, Hawaii, or Puer- to Rico, other than a point in Alaska north of the Arctic Circle. (Added Pub. L. 116–283, div. C, title XXXV, § 3511(a), Jan. 1, 2021, 134 Stat. 4415; amended Pub. L. 117–263, div. C, title XXXV, § 3517(b)(3), Dec. 23, 2022, 136 Stat. 3074; Pub. L. 118–159, div. C, title XXXV, § 3531(b), Dec. 23, 2024, 138 Stat. 2312.) Editorial Notes AMENDMENTS 2024—Subsec. (a). Pub. L. 118–159 amended subsec. (a) generally. Prior to amendment, text read as follows: ‘‘Subject to the availability of appropriations for such purpose and the other provisions of this chapter, the Secretary shall pay to program participant for an oper- ating agreement under this chapter an amount equal to $6,000,000 for each vessel covered by the agreement for each fiscal year that the vessel is covered by the agree- ment. Such amount shall be paid in equal monthly in- stallments on the last day of each month. The amount payable under this subsection may not be reduced ex- cept as provided by this section or section 51307(b).’’ 2022—Subsec. (a). Pub. L. 117–263 inserted ‘‘or section 51307(b)’’ after ‘‘this section’’. § 53407. National security requirements (a) EMERGENCY PREPAREDNESS AGREEMENT RE- QUIRED.—The Secretary of Transportation, in co- ordination with the Secretary of Defense, shall establish an emergency preparedness program under this section under which the program par- ticipant for an operating agreement under this chapter shall agree, as a condition of the oper- ating agreement, to enter into an emergency preparedness agreement with the Secretary. The Secretary shall negotiate and enter into an Emergency Preparedness Agreement with each program participant as promptly as practicable after the program participant has entered into the operating agreement. (b) TERMS OF AGREEMENT.—The terms of an agreement under this section— (1) shall provide that upon request by the Secretary of Defense during time of war or na- tional emergency, or whenever determined by the Secretary of Defense to be necessary for national security or contingency operation (as that term is defined in section 101 of title 10), the program participant shall make available commercial transportation resources (includ- ing services) described in subsection (d) to the Secretary of Defense; (2) shall include such additional terms as may be established by the Secretary of Trans- portation and the Secretary of Defense; and (3) shall allow for the modification or addi- tion of terms upon agreement by the Sec- retary of Transportation and the program par- ticipant and the approval by the Secretary of Defense. Page 424 TITLE 46—SHIPPING § 53408 (c) PARTICIPATION AFTER EXPIRATION OF OPER- ATING AGREEMENT.—Except as provided by sec- tion 53406, the Secretary of Transportation may not require, through an emergency preparedness agreement or an operating agreement, that a program participant covered by an operating agreement continue to participate in an emer- gency preparedness agreement after the oper- ating agreement has expired according to its terms or is otherwise no longer in effect. After the expiration of an emergency preparedness agreement, a program participant may volun- tarily continue to participate in the agreement. (d) RESOURCES MADE AVAILABLE.—The com- mercial transportation resources to be made available under an emergency preparedness agreement shall include vessels or capacity in vessels, terminal facilities, management serv- ices, and other related services, or any agreed portion of such nonvessel resources for activa- tion as the Secretary of Defense may determine to be necessary, seeking to minimize disruption of the program participant’s service to commer- cial customers. (e) COMPENSATION.— (1) IN GENERAL.—The Secretary of Transpor- tation shall include in each Emergency Pre- paredness Agreement provisions approved by the Secretary of Defense under which the Sec- retary of Defense shall pay fair and reasonable compensation for all commercial transpor- tation resources provided pursuant to this sec- tion. (2) SPECIFIC REQUIREMENTS.—Compensation under this subsection— (A) shall not be less than the program par- ticipant’s commercial market charges for like transportation resources; (B) shall be fair and reasonable considering all circumstances; (C) shall be provided from the time that a vessel or resource is required by the Sec- retary of Defense until the time it is redeliv- ered to the program participant and is avail- able to reenter commercial service; and (D) shall be in addition to and shall not in any way reflect amounts payable under sec- tion 53406 of this title. (f) TEMPORARY REPLACEMENT VESSELS.—Not- withstanding section 55302(a), 55304, 55305, or 55314 of this title, section 2631 of title 10, or any other cargo preference law of the United States— (1) a program participant may operate or employ in foreign commerce a foreign-flag vessel or foreign-flag vessel capacity as a tem- porary replacement for a vessel of the United States or vessel of the United States capacity that is activated by the Secretary of Defense under an emergency preparedness agreement or a primary Department of Defense sealift-ap- proved readiness program; and (2) such replacement vessel or vessel capac- ity shall be eligible during the replacement period to transport preference cargoes subject to sections 55302(a), 55304, 55305, and 55314 of this title and section 2631 of title 10, United States Code, to the same extent as the eligi- bility of the vessel or vessel capacity replaced. (g) REDELIVERY AND LIABILITY OF THE UNITED STATES FOR DAMAGES.— (1) IN GENERAL.—All commercial transpor- tation resources activated under an emer- gency preparedness agreement shall, upon ter- mination of the period of activation, be re- delivered to the program participant in the same good order and condition as when re- ceived, less ordinary wear and tear, or the Sec- retary of Defense shall fully compensate the program participant for any necessary repair or replacement. (2) LIMITATION ON UNITED STATES LIABILITY.— Except as may be expressly agreed in an emer- gency preparedness agreement, or as otherwise provided by law, the Government shall not be liable for disruption of a program participant’s commercial business or other consequential damages to the program participant arising from the activation of commercial transpor- tation resources under an emergency pre- paredness agreement. (Added Pub. L. 116–283, div. C, title XXXV, § 3511(a), Jan. 1, 2021, 134 Stat. 4416.) § 53408. Regulatory relief (a) OPERATION IN FOREIGN COMMERCE.—A pro- gram participant for a vessel included in an op- erating agreement under this chapter may oper- ate the vessel in the foreign commerce of the United States without restriction. (b) OTHER RESTRICTIONS.—The restrictions of section 55305(a) of this title concerning the building, rebuilding, or documentation of a ves- sel in a foreign country shall not apply to a ves- sel for any day the operator of the vessel is re- ceiving payments for the operation of that ves- sel under an operating agreement under this chapter. (c) TELECOMMUNICATIONS EQUIPMENT.—The telecommunications and other electronic equip- ment on an existing vessel that is redocumented under the laws of the United States for oper- ation under an operating agreement under this chapter shall be deemed to satisfy all Federal Communications Commission equipment ap- proval requirements, if— (1) such equipment complies with all appli- cable international agreements and associated guidelines as determined by the country in which the vessel was documented immediately before becoming documented under the laws of the United States; (2) that country has not been identified by the Secretary as inadequately enforcing inter- national regulations as to that vessel; and (3) at the end of its useful life, such equip- ment shall be replaced with equipment that meets Federal Communications Commission equipment approval standards. (Added Pub. L. 116–283, div. C, title XXXV, § 3511(a), Jan. 1, 2021, 134 Stat. 4417.) § 53409. Special rule regarding age of partici- pating Fleet vessels Any age restriction under section 53402(b)(4) of this title shall not apply to a participating Fleet vessel during the 30-month period beginning on the date the vessel begins operating under an operating agreement under this chapter, if the Secretary determines that the program partici-