CIVILIAN AGENCIES
The Civilian Agencies team works with all
government-impelled cargo that is (1) not covered under the Military Cargo Preference Act
of 1904, essentially Department of Defense (DOD) cargo, or (2) not covered under the
Agricultural Food Aid Program.
The team works with the private sector shippers, suppliers and ocean carriers, as well as
applicable civilian Government Agencies to assist all parties with their compliance
with the applicable Federal legislation on cargo preference.
Legislation
The Cargo Preference Act of 1954 (P.L. 83-664), as amended, applies to all
government-impelled cargo moving in international ocean trade. It requires that at
least 50 percent of the gross tonnage of all U.S. Government-impelled cargo be transported
on privately owned, U.S.-flag commercial vessels. The "at least 50
percent" requirement is applicable to the extent such vessels are available at fair
and reasonable rates, as determined by MARAD.
Government-Impelled Cargo
Government-impelled cargo is defined as cargo that is moving either as a direct
result of the U.S. Government's involvement or indirectly due to financial sponsorship of
a Federal program or under a guarantee provided through the Federal Government.
Compliance Responsibility
It is the responsibility of each Department or Agency to ensure it and its
contractors comply with the Cargo Preference Act of 1954. One of the prime methods
to accomplish this is for the Agency or Department involved to have the appropriate
clauses inserted in their program contracts and documentation.
Federal Acquisition Regulations (FAR)
The Cargo Preference Act of 1954 is administered by all Departments and Agencies,
other than DOD, under the Federal Acquisition Regulations as set forth in 48 CFR Subpart
47.5 "Ocean Transportation by U.S.-flag Vessels."
Reporting to MARAD
Regulations require that documentation on all government-impelled cargo moves
must be reported to MARAD within 20 working days from date of loading on all shipments
loaded from the United States and 30 working days for shipments loaded outside the United
States. The reporting requirement applies whether the cargo moves on a foreign-flag
or U.S.-flag vessel. A copy of the ocean carrier's bill of lading, certified onboard, with
rates and charges, is considered sufficient to meet the reporting requirements.
Export Import Bank - Public Resolution (PR)
17
Certain cargoes generated by the Export Import Bank (Ex-Im Bank) are required by
Public Resolution 17 of the 73rd Congress as approved on March 26, 1934, to be carried 100
percent on U.S.-flag vessels.
PR 17 is implemented by the Export Import Bank under
regulations set forth in 12 CFR 402.3 "Marine Transportation and Insurance(a) Marine
Transportation."
Loans
All direct loans generated under Export Import Bank financing are to be shipped
exclusively on U.S.-flag vessels under PR 17 Regulations.
Guarantees
Cargo generated under Export Import Bank guarantees are to be shipped exclusively
on U.S.-flag vessels provided the guarantee amount is over $10 million or if the term of
the guarantee is over 7 years.
Waivers
Requests for Waivers under PR 17 may be submitted to the Maritime Administration,
an agency of the U.S. Department of Transportation. Waivers can be obtained for a
variety of reasons (e.g., if a U.S. vessel is unavailable or unsuitable). If a waiver is
obtained, goods shipped on vessels of non-U.S. registry are eligible for financing by
Ex-Im Bank.
Types of Waivers include:
Statutory - Non availability
General - Special treaty agreement for recipient
nation to carry up to 50%
Compensatory - Allows for compensatory make-up
shipments where there are extenuating circumstances
Conditional - Issued primarily for
over-dimensional cargo and specialty project cargo, on a long-term basis but subject to
review if conditions change
To obtain more detailed information on the PR 17
program and particularly on the types of waivers listed above, click on http://www.marad.dot.gov/offices/pr17waiver.html.
Reporting to Congress
Every Department or Agency having responsibility under the Cargo Preference Act
of 1954 is required to administer its programs under the regulations issued by the
Secretary of Transportation. The Secretary of Transportation will review such
administration and report annually to the U.S. Congress.
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