The Maritime Administration (MARAD), part of the U.S. Department of Transportation, published a notice in the Federal Register on January 7, 2026, inviting public comments on a request to allow the foreign-built small passenger vessel M/V FORTUNA to engage in U.S. coastwise trade. This action stems from a determination request under 46 U.S.C. 12121(b), which permits certain small vessels to carry up to 12 passengers for hire in domestic waters if MARAD finds no adverse impact on U.S. vessel builders or businesses relying on American-built vessels. The notice, docketed as MARAD-2025-1191, sets a comment deadline of February 6, 2026, and highlights the ongoing balance between facilitating maritime operations and protecting domestic industries. This development underscores the regulatory framework governing coastwise trade, often called the Jones Act, and its exceptions for small passenger vessels.
Background and Legal Framework
The request involves M/V FORTUNA, a foreign-built vessel intended for coastwise trade, which typically refers to transportation between U.S. points by water without leaving U.S. territorial waters. Under the Passenger Vessel Services Act and related statutes, foreign-built vessels are generally prohibited from such activities to safeguard U.S. shipbuilding and maritime industries. However, 46 U.S.C. 12121(b) provides a narrow exemption for small passenger vessels carrying no more than 12 passengers, provided MARAD determines after public notice and comment that the operation will not harm U.S. vessel builders or coastwise trade businesses using U.S.-built vessels.
This authority is shared between MARAD and the U.S. Coast Guard (USCG), with the latter issuing coastwise endorsements on vessel documentation if MARAD approves. The process traces back to amendments in the Coast Guard Authorization Act of 1998, which aimed to address shortages in small vessel availability for niche services like charters or tours. Precedents include similar waivers for vessels in regions like Hawaii or Alaska, where domestic options may be limited, as noted in prior Federal Register notices. For instance, a 2019 MARAD determination for a foreign-built yacht highlighted concerns from U.S. builders about market competition, leading to conditional approvals in some cases.
Key Players and Proposed Operations
MARAD, representing the Secretary of Transportation, is the lead agency here, with Patricia Hagerty listed as the contact for further information. The requester's identity is not detailed in the notice, but the full request, including vessel specifications and proposed services, is available in the docket at regulations.gov under MARAD-2025-1191. The notice emphasizes that comments should focus on potential adverse effects, supported by documentation, from interested parties such as U.S. vessel builders or operators.
The proposed use of M/V FORTUNA would involve carrying no more than 12 passengers for hire in coastwise trade. While specifics like routes or business models are in the docketed request, the notice frames this as a standard eligibility review. Key players include potential commenters from the American shipbuilding sector, represented by groups like the Shipbuilders Council of America, which has historically opposed such waivers to prevent undercutting domestic production. On the other side, applicants often include tourism operators or private entities seeking cost-effective vessels for limited passenger services.
Potential Implications and Perspectives
Allowing M/V FORTUNA into coastwise trade could provide short-term benefits by expanding vessel availability for small-scale operations, potentially boosting local economies in coastal areas through increased tourism or charter services. In the long term, however, repeated exemptions might erode incentives for U.S. shipbuilding, as foreign vessels could flood niche markets. Data from the U.S. Bureau of Labor Statistics shows the shipbuilding industry employs over 100,000 workers, and disruptions could affect jobs and supply chains.
Different perspectives emerge in these debates. Proponents of waivers argue they fill gaps where U.S.-built vessels are unavailable or uneconomical, citing examples from the Small Vessel Waiver Program under similar statutes. Critics, including unions like the Seafarers International Union, contend that such actions violate the spirit of the Jones Act, which protects national security by maintaining a robust domestic fleet. A 2020 Government Accountability Office report on Jones Act impacts noted that waivers are rare but can spark litigation, as seen in challenges to MARAD decisions in federal courts like the U.S. District Court for the District of Columbia.
From a regulatory standpoint, this notice reflects broader political forces, including congressional oversight of maritime policy. Recent legislative efforts, such as the National Defense Authorization Act provisions, have sought to strengthen Jones Act enforcement while allowing flexibility for small vessels. Stakeholders without endorsing views highlight that approvals often hinge on evidence of no suitable U.S.-built alternatives, as required by statute.
Challenges and Ongoing Debates
The comment period offers a platform for evidence-based input, with MARAD required to consider submissions before deciding. Potential challenges include verifying claims of adverse effects, as past determinations have faced appeals if documentation is deemed insufficient. Looking ahead, this case could influence future requests amid evolving maritime needs, such as those driven by climate change or tourism recovery. Debates continue on whether the 12-passenger threshold adequately protects domestic interests or if reforms are needed to adapt to global supply chains. As MARAD reviews comments, the outcome will shape how exemptions are granted, balancing economic access with industry protection.
