Senate Appropriations Committee Proposes Restricting Jones Act Waivers

The Jones Act, which restricts U.S. domestic commerce to qualified U.S.-flag vessels, can be waived if it is found to be in the interests of national security and generally where it is found that no qualified U.S.-flag capacity is available. A number of Jones Act waivers were issued in connection with the sale and transportation of Strategic Petroleum Reserve oil sold pursuant to a June 23, 1011 Notice of Sale. On September 7, 2011, the Senate Appropriations Committee reported favorably for Senate consideration of the fiscal year 2012 Department of Homeland Security Appropriations bill with a restriction on the issuance of Jones Act waivers. Specifically, the bill prohibits funds from being used for future waivers until the Department of Homeland Security has consulted with the Departments of Energy and Transportation and U.S.-flag industry representatives "to ensure the use of United States flag vessels." The provision also requires DHS to inform Congress within 48 hours of any waiver request.