Jones Act Waivers and Other Applicable US Laws for Foreign Vessels
Summary
A notice from K&L Gates LLP discusses the implications of a recent 60-day Jones Act waiver allowing foreign vessels to transport goods domestically. The waiver, issued under national defense interests, raises questions about the applicability of other US laws, including tax, labor, and employee protection laws, to these foreign vessels.
What changed
This notice from K&L Gates LLP highlights critical legal uncertainties surrounding a recent 60-day Jones Act waiver that permits foreign-flagged vessels to engage in domestic US cargo transport for 659 product categories. While the waiver, issued under 46 U.S.C § 501(a) for national defense reasons, specifically addresses navigation and vessel-inspection laws, it leaves open significant questions regarding the applicability of other US statutes. These include potential US tax liabilities on income earned from domestic voyages, visa requirements for foreign seafarers, and obligations to provide US labor rights, such as minimum wage, to employees on these vessels.
For charterers and foreign vessel operators utilizing this waiver, the implications are substantial. Unlike previous waivers, this one mandates public disclosure of voyage details by the US Maritime Administration, increasing legal exposure. Compliance officers should be aware that while the waiver permits operation under the Jones Act, other US laws may still apply, creating potential liabilities and operational complexities. The lack of specific guidance from agencies like CBP on these broader legal obligations necessitates careful consideration and proactive legal review to ensure compliance and mitigate risks associated with operating in US domestic trades under the waiver.
What to do next
- Review applicability of US tax laws to income earned from domestic voyages.
- Assess visa requirements for foreign seafarers operating on waiver-covered voyages.
- Evaluate compliance with US labor and employee protection laws for vessel crews.
Source document (simplified)
March 25, 2026
Foreign Vessels Operating Under the Jones Act Waiver Should Consider What Other US Laws May Apply
Darrell Conner, Mark Ruge, Michael Heard Snow, Elle Stuart K&L Gates LLP + Follow Contact LinkedIn Facebook X Send Embed
The Trump administration’s waiver of the nation’s domestic cabotage laws under the family of laws known as the Jones Act 1 is highly unusual for both its length (60 days) and its breadth (659 categories of products). 2 While the Jones Act normally requires the use of US-flagged, built, owned, and operated vessels for domestic voyages, 3 this waiver allows foreign-flagged vessels to operate on these routes, creating a critical open question for charterers and other potential users: What US laws will apply to foreign vessels operating under the waiver?
The waiver was issued under 46 U.S.C § 501(a), which permits a waiver “to the extent that the Secretary [of War ] 4 considers necessary in the interest of national defense to address an immediate adverse effect on military operations.” Section 501(a) is limited to only waivers of the “navigation or vessel-inspection laws,” including the Jones Act. 5
So, what about other US laws? For example, are the foreign vessels subject to US tax laws for their income earned on what are by definition US domestic 6 voyages? Likewise, will foreign seafarers operating on vessels calling on the United States be required to obtain visas applicable to those operations? Will the vessel owners ensure that their employees are granted the same labor rights—such as paying US minimum wage—afforded to US mariners? In previous studies, the US Government Accountability Office (GAO) has listed US tax, labor, and employee protection laws among those that could apply if a foreign vessel operated in US domestic commerce. 7 GAO has sometimes referred to these additional US laws as the “cost of compliance” for foreign vessels in US domestic commerce. 8
US Customs and Border Protection (CBP), the agency responsible for issuing Jones Act waivers, has only provided guidance on the requirements for vessels operating under this particular waiver. No other agency has provided guidance on compliance with any other applicable laws for foreign vessels clearly operating in US domestic trades. In addition, it is not clear what authority, if any, the administration could use to waive other US laws for a foreign vessel operating in perhaps the exact same trades as a US vessel for which those US laws would fully apply.
The issue takes on a particular gravity because since 2021 all foreign vessel operators who transport US domestic cargo under a waiver are required to share detailed information about the voyage with the US Maritime Administration—information that then must be publicly disclosed within 10 days on the US Department of Transportation website. 9 CBP emphasized the need for public reporting in announcing the waiver. This latest waiver will be the first in which public disclosure is mandated by law in this way, creating additional legal exposure for vessel operators or others utilizing the waiver.
Our Maritime practice group team is closely monitoring these developments and is well positioned to assist clients in navigating this rapidly changing landscape and its uncertainties.
Footnotes
1 For more background information on the Jones Act refer to the Essential Guide to the Jones Act at: https://www.klgates.com/The-Essential-Guide-to-the-Jones-Act.
2 CSMS # 68096516 - Implementation of Jones Act Waiver Issued to the Department of War (Mar. 17, 2026), https://content.govdelivery.com/bulletins/gd/USDHSCBP-40f1204?wgtref=USDHSCBPWIDGET_2.
3 46 U.S.C. § 55102.
4 Restoring the United States Department of War, Exec. Order No. 14347, 90 Fed. Reg. 43893 (Sep’t 10, 2025).
5 In addition to the language in the law itself, the title of the section (“Waiver of navigation and vessel-inspection laws”) even highlights this limited application.
6 I.e., transporting merchandise from one point in the United States to another point in the United States.
7 U.S. GOV’T ACCOUNTABILITY OFF., GAO-04-421, EXEMPTION PROVIDES LIMITED COMPETITIVE ADVANTAGE, BUT BARRIERS TO FURTHER ENTRY UNDER U.S. FLAG REMAIN (2004), https://www.gao.gov/assets/gao-04-421.pdf.
8 Letter from Gerald L. Dillingham, Assoc. Dir., Transp. Issues, U.S. Gov’t Accountability Off., to the Hon. John McCain, Chairman, Senate Comm. on Com., Sci., & Transp., 4 (Mar. 6, 1998), https://www.gao.gov/assets/90/87426.pdf.
9 46 U.S.C. § 501(c).
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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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