United States vessel preference requirement

(a) In general Part D of subtitle V of title 46, United States Code, is amended by inserting after subchapter III the following new subchapter: IV United States Vessel Preference 55351. Definitions. 55352. Establishment of the United States vessel preference requirement. 55353. Maritime special security agreement framework. 55354. Enforcement and compliance. 55351. Definitions In this subchapter: (1) Allied country The term allied country means a country or group of countries designated by the Secretary of Defense, in consultation with the Secretary of Transportation and the Secretary of State, as an ally of the United States for purposes of this subchapter. (2) Beneficial cargo owner The term beneficial cargo owner means an entity that retains the power to influence the routing of the cargo or owns the merchandise being transported at the time of shipment. (3) Country of concern The term country of concern means a country identified pursuant to section 4651(7) of title 15, United States Code. (4) Covered cargo The term covered cargo means inbound containerized cargo and roll-on/roll-off vehicles imported into the United States in the foreign commerce of the United States that are subject to entry, manifest reporting, or other customs documentation requirements under title 19, United States Code, as further specified by the Commission by regulation. The term does not include exports, bulk cargo, breakbulk cargo, or cargo excluded by regulation consistent with this subchapter. (5) Industrial readiness certification The term industrial readiness certification means a certification made by the Maritime Administrator after evaluating shipyard capacity, mariner availability, and commercial feasibility for purposes of phased implementation. "(6) Maritime Special Security Agreement; M-SSA.—The term Maritime Special Security Agreement or M-SSA means an agreement established under section 55353. (6) Qualifying united states vessel The term qualifying United States vessel means a vessel documented under chapter 121 of title 46 and meeting requirements under section 55352 and not a U.S. warship, auxiliary vessel, or under time or bare-boat charter by the United States. (7) Trade lane The term trade lane means a geographic shipping corridor designated by the Secretary of Transportation. (8) Compliance year The term compliance year means a calendar year for which participation targets apply under section 55352, as determined under section 55354(j). (9) Covered movement The term covered movement means the transportation by water of covered cargo to the United States within a designated trade lane subject to participation targets under section 55352, as determined by the Commission under section 55354 using existing customs and shipping documentation. (10) Covered shipper The term covered shipper means, with respect to a covered movement, the beneficial cargo owner, importer of record to which entity-level participation targets apply under section 55352(a)(2), or provider of third-party logistics services for cargo shipments, as determined by the Commission under section 55354 using existing customs and shipping documentation. The term does not include an ocean common carrier or an ocean transportation intermediary solely by virtue of providing ocean transportation or arranging ocean transportation. (11) Affiliated covered shipper group The term affiliated covered shipper group means 2 or more covered shippers that are treated as a single compliance unit because they are under common control, are alter egos, are successors, or act in concert with respect to routing, contracting, or payment for ocean transportation of covered cargo, as determined under section 55354. (12) Control The term control means, with respect to an entity, direct or indirect possession of the power to direct or cause the direction of management and policies of such entity (whether through ownership of voting securities, by contract, or otherwise), and shall be presumed where an entity directly or indirectly owns 50 percent or more of the equity or voting interests. (13) Unique entity identifier The term unique entity identifier means an Employer Identification Number (EIN) or such other persistent identifier as the Commission shall specify by regulation for foreign persons, including an identifier used in customs entry, manifest, or service contract documentation. (14) Ultimate parent entity The term ultimate parent entity means the highest-level entity that controls a covered shipper, and that is not controlled by another entity. (15) Commission The term Commission means the Federal Maritime Commission. (16) Ocean common carrier The term ocean common carrier has the meaning given that term at section 40102(18) of this title. (17) Ocean transportation intermediary The term ocean transportation intermediary has the meaning given that term at section 40102(20) of this title. (18) Service contract The term service contract means service contracts as set forth at section 40102(21) of this title. (19) Civil penalty A civil penalty is a civil penalty under sections 41107 and 41109 of this title. 55352. Establishment of the United States vessel preference requirement (a) Establishment (1) In general The Secretary of Transportation shall establish a United States vessel cargo participation requirement applicable to the carriage of covered cargo within designated trade lanes. (2) Application Participation targets established under this section shall apply as entity-level participation requirements to each beneficial cargo owner or importer of record operating within a designated trade lane and shall be aggregated across the affiliated covered shipper group (if any) of such entity, as determined under section 55354. (3) Participation targets Participation targets— (A) may be established on a trade-lane-specific and commodity-specific basis, including the inclusion or exclusion of particular commodity categories, provided that aggregate participation meets or exceeds the minimum phase-based floors established under subsection (b); and (B) shall be implemented on a trade-lane-specific and, where appropriate, commodity-specific basis and shall be designed to expand participation of qualifying United States vessels in a commercially feasible, capacity-aware, and phased manner. (4) Rule of construction Nothing in this section shall be construed to establish a uniform nationwide cargo quota or to require identical participation targets across all trade lanes or commodity categories. (b) Phased implementation Participation targets established under this section shall be implemented through sequential phases designed to expand United States-flag participation in a commercially feasible and capacity-aware manner, as provided for in this section. (1) Phase I—initial market entry (A) Not later than 180 days following enactment of this section, the Secretary shall establish an initial participation target of not less than 3 percent of covered cargo overall on an annual basis within designated trade lanes be carried on qualifying United States vessels, unless a lower percentage is certified as necessary due to vessel or mariner availability. (B) Participation targets established during this phase shall— (i) be in effect for a period of no less than four years upon the first day of establishment; (ii) Be used to incentivize and facilitate re-flagging, new service entry, and contract restructuring to emphasize voluntary transition into the U.S.—flag fleet. (iii) be treated as a pilot period for purposes of evaluating commercial feasibility, workforce impacts, and industrial readiness; and (iv) be prioritized along trade lanes, as described in subsection (c), where qualifying United States vessels are already operating or can be deployed with minimal disruption to existing logistics structures. (2) Phase II—capacity expansion For the four years following Phase I, the Secretary shall— (A) increase participation targets incrementally based on fleet availability, workforce capacity, and industrial readiness as determined annually by the Maritime Administrator; and (B) increase participation targets by not less than 1.5 percent annually unless the Maritime Administrator makes a determination that the United States fleet or mariner workforce cannot sustain a growth rate at that level; and (C) establish participation targets that prioritize the use of vessels built in the United States over foreign-built vessels that have reflagged into the U.S. fleet. (3) Phase III—adaptive scaling Following Phase II— (A) the Secretary— (i) shall review participation targets not less than every three years; and "(ii) may establish revised participation targets reflecting demonstrated fleet growth, shipyard output, and mariner supply. (B) participation targets— (i) may require that a percentage of covered cargo be carried only on vessels built in the United States; and (ii) may be trade-lane specific but vary by commodity classification; and (C) participation target growth shall be— (i) not less than 2 percent overall on an annual basis; and (ii) 1 percent for United States built ships unless a determination is made by the Administrator that the United States fleet or mariner workforce cannot sustain a growth rate at that level. (4) Annual review and certification Not less than once each year, the Maritime Administrator shall make a determination as to whether vessel capacity, mariner availability, and commercial feasibility support continuation or adjustment of participation targets. (A) The Maritime Administration shall provide to Congress annually a report on the targets for the succeeding fiscal year showing the growth in reflagged United States flag ships, growth in United States built ships, and the status of the overall United States flag fleet in international trade. (B) The Secretary may temporarily pause or modify scheduled increases upon certification of material capacity constraints. (5) Rule of construction Nothing in this subsection shall be construed to establish a uniform nationwide cargo quota or to require identical targets across trade lanes or commodity categories. (c) Prioritization of trade lanes and commodities (1) In general In selecting trade lanes and commodity groupings for phased implementation under this section, the Secretary of Transportation, in concurrence with the Secretary of State, and in consultation with the Secretary of the Treasury, Secretary of Commerce, United States Trade Representative, Chairperson of the Federal Maritime Commission, and Secretary of Homeland Security, shall give priority to trade lanes and commodities that have a direct bearing on national security, supply chain resilience, or United States economic competitiveness. (2) Priority considerations Priority considerations may include critical minerals, energy systems, defense-related cargo, strategic manufacturing inputs, and other sectors determined to be essential to national preparedness or long-term industrial capacity. (3) Rule of construction Nothing in this subsection shall be construed to require uniform application across all trade lanes or to limit the Secretary’s discretion to consider commercial feasibility, vessel availability, or workforce capacity. (d) Commercial feasibility Trade lane targets under this section must be operationally achievable within existing commercial shipping practices and account for vessel availability, mariner supply, and contractual logistics structures. (e) United States content For purposes of this subchapter, United States content shall be measured, at the vessel level, as a percentage of the total cost of construction, conversion, repair, and refurbishment of the vessel that is attributable to labor performed in the United States and materials produced in the United States, consistent with the standards articulated in chapter 83 of title 41, United States Code. The Secretary shall prescribe by regulation methods of calculation, eligible costs, and documentation standards for certification and audit. (f) Equivalency authority The Maritime Administrator may grant equivalencies on a per country basis where domestic industrial capacity is insufficient. (g) Special rule for containerized commodity classification (1) Classification For purposes of commodity-specific preference targets, containerized cargo shall be classified based on Customs and Border Protection-recognized shipment programs rather than the individual contents of a container. (2) Commodity categories defined The Secretary may define commodity categories using— (A) Harmonized Tariff Schedule chapter ranges or groupings recognized by U.S. Customs and Border Protection; (B) beneficial cargo owner program declarations or certified logistics programs; or (C) service contract filings or vessel service designations maintained under applicable Federal Maritime Commission or customs reporting requirements. (3) Measuring compliance Compliance shall be measured using existing customs documentation, including bills of lading, manifest filings, or service contract identifiers, and shall not require inspection or valuation of individual goods within containers. (4) Mixed merchandise Where containers include mixed merchandise described as general cargo, the Secretary may treat such containers as part of a designated commodity program if tendered under a qualifying contract, Harmonized Tariff Schedule grouping, or certified cargo program. (5) Rule of construction Nothing in this subsection shall be construed to require item level auditing of container contents beyond existing customs reporting requirements; nor shall it be construed to limit, restrict, or alter the authority of the U.S. Coast Guard or U.S. Customs and Border Protection to inspect containers and cargo for safety, security, or law enforcement purposes. (6) Reliance on existing systems Commodity classifications and compliance determinations under this subsection shall rely exclusively on customs declarations, service contract filings, or other reporting systems already required under Federal law, and shall not create a separate cargo classification regime. (h) Requirement to protect and share information The Secretary and the Chairman of the Federal Maritime Commission shall execute an agreement to establish a formal framework for the exchange of information necessary to implement this section that protects the privacy and confidentiality rights of private parties. (i) National security condition for qualification (1) In general A vessel shall not be treated as a qualifying United States vessel for purposes of this subchapter if the vessel is owned, chartered, managed, or operated by or on behalf of an entity subject to foreign ownership, control, or influence, unless such entity is operating pursuant to an approved Maritime Special Security Agreement under section 55353. (2) No automatic requirement for domestic entities Nothing in this subsection shall be construed to require a Maritime Special Security Agreement for an entity that the Maritime Administrator determines is not subject to foreign ownership, control, or influence. (3) Country of concern prohibition No vessel controlled by a citizen of a country of concern may qualify under this subchapter if such citizen holds, directly or indirectly, a controlling interest or other disqualifying influence in the entity owning, chartering, managing, or operating the vessel, as determined under regulations issued pursuant to section 55353. (j) Qualifying United States vessel requirements (1) In general A vessel is a qualifying United States vessel for purposes of this subchapter only if the vessel is documented under chapter 121 of this title and meets the requirements of this subsection, subsection (k), and section 55353 (as applicable). (2) Repaired or refurbished vessels A U.S.-documented vessel that is repaired or refurbished may be treated as meeting the United States content thresholds under paragraph (3) if the Secretary determines that the cost of such repairs or refurbishments includes sufficient United States content under subsection (g), and if the vessel was originally built in an allied country. (3) United States content thresholds A qualifying United States vessel shall meet the following minimum United States content thresholds: (A) For calendar years 2027 through 2030, an allied-built vessel may qualify if the vessel is inspected, certificated, and documented consistent with section 53102(e) of this title and related Coast Guard guidance (including Navigation and Vessel Inspection Circular No. 01-13, and any successor guidance) and is operated by an entity in compliance with section 55353. (B) For calendar years 2031 through 2034, at least 20 percent United States content. (C) For calendar years 2035 through 2038, at least 30 percent United States content. (D) For calendar years 2039 through 2042, at least 40 percent United States content. (E) Beginning in calendar year 2042, at least 51 percent United States content. (4) Qualification extension Beginning in calendar year 2031, a vessel that first qualifies under this subchapter shall continue to be a qualifying United States vessel for not more than 20 years after the date the vessel is first documented under chapter 121 of this title, provided the vessel maintains at least 20 percent United States content throughout that period. (5) Alternate compliance program requirements Requirements unique to the Alternate Compliance Program shall not apply to an allied-built vessel described in paragraph (3)(A) unless the Coast Guard determines such requirements are strictly necessary for safety or security; however, United States-unique requirements contained in the Alternate Compliance Program U.S. Supplement are otherwise waived for eligible vessels. (6) Coastwise trade Nothing in this subchapter shall be construed to alter or supersede the requirements of chapter 551 of this title (the coastwise trade laws). Qualifying United States vessels under this subchapter are intended for foreign commerce under United States registry and are not granted coastwise trading privileges by this subchapter. (7) Expansion to meet national security needs The President may expand the types of cargo subject to this subchapter if the President determines such expansion is necessary to meet the national security needs of the United States, provided that any cargo so added is afforded the same phased implementation and United States content requirements for qualifying vessels specified in this section. (k) Rule of construction Nothing in this section shall be construed to— (1) impose a uniform nationwide cargo quota or to require preference targets to apply across all trade lanes or cargo categories; (2) waive or modify vessel documentation, inspection, certification, safety, security, or vessel-to-facility interface requirements administered by the Coast Guard or the Department of Labor; (3) deem any person or entity a citizen of the United States for purposes of this title, including chapter 121, except for the limited deeming described in subsection (j); or (4) limit any other national security review authority of the United States. 55353. Maritime special security agreement framework (a) Establishment Not later than 180 days after the date of enactment of this subchapter, the Secretary of Transportation in consultation with the Secretary of Defense and the Secretary of Homeland Security (including the Commandant of the Coast Guard), shall establish by regulation a Maritime Special Security Agreement framework (in this section referred to as an ‘M-SSA’), modeled on foreign-ownership, control, or influence mitigation agreements used in national-security sectors, to permit allied and other foreign capital investment while ensuring United States operational control and protection of security-sensitive information. (b) Purpose; parties; covered entities (1) Purpose An M-SSA is a written agreement intended to mitigate foreign ownership, control, or influence and to ensure that management and operational control over qualifying United States vessel operations under this subchapter remain vested in United States citizens, consistent with national security requirements. (2) Parties An M-SSA shall be executed between the Maritime Administrator and a vessel owner, vessel operator, or other entity that seeks to own, charter, manage, or operate a qualifying United States vessel under this subchapter (in this section referred to as a covered entity). (3) Scope of application An M-SSA shall apply only to the covered entity and the qualifying United States vessels and related operations identified in the agreement. (c) Eligibility; prohibited capital The Maritime Administrator may approve an M-SSA only if— (1) the covered entity certifies that no citizen from a country of concern holds, directly or indirectly, a controlling interest or other disqualifying influence, as determined under regulations issued pursuant to subsection (j); (2) the covered entity agrees to comply with the governance, operational-control, information-security, reporting, and audit requirements of this section; and (3) the Maritime Administrator has consulted with the Secretary of Defense and the Secretary of Homeland Security regarding any national security conditions that should be incorporated into the M-SSA. (d) Core requirements A covered entity operating under an M-SSA shall— (1) maintain a principal executive responsible for qualifying United States vessel operations who is a citizen of the United States; (2) ensure that qualifying United States vessel operations under this subchapter remain subject to governance and operational-control arrangements vested in citizens of the United States, as specified in the M-SSA; (3) establish a security committee or comparable governance mechanism composed solely of citizens of the United States to oversee security-sensitive decisions identified in the M-SSA; (4) implement information firewalls restricting foreign access to sensitive operational, logistics, and defense-related data, consistent with subsection (f); and (5) designate one or more compliance officers responsible for administration of the MSSA who are citizens of the United States and eligible for any security clearances determined appropriate by the Secretary of Defense for purposes of the M-SSA. (e) Security committee or equivalent governance mechanism (1) Composition The security committee or equivalent governance mechanism required under subsection (d)(3) shall consist solely of citizens of the United States. (2) Authorities The security committee or equivalent governance mechanism shall exercise such approval, oversight, or veto authorities over security-sensitive decisions as are specified by regulation and in the applicable M-SSA, including with respect to— (A) access to and dissemination of security-sensitive operational, cargo, routing, or defense-related information; (B) changes in key personnel positions identified in the M-SSA; (C) changes in ownership, governance, financing, chartering, or other arrangements that could increase foreign ownership, control, or influence; and (D) such other matters as the Maritime Administrator determines necessary to mitigate national security risk, in consultation with the Secretary of Defense and the Secretary of Homeland Security. (3) Governance instruments The covered entity shall adopt bylaws, delegations of authority, internal controls, and other governance instruments sufficient to give effect to the authorities required under this subsection. (f) Information firewall; recordkeeping (1) Firewall Each covered entity operating under an M-SSA shall maintain policies, technical controls, and procedures that prevent unauthorized foreign access to security-sensitive operational and defense-related information, including through remote access or third-party service providers. (2) Records The covered entity shall maintain such books, records, and technical logs as the Maritime Administrator determines necessary to verify compliance, including records sufficient to support audits under subsection (h). (g) Notice of change; prior approval A covered entity operating under an M-SSA shall provide advance notice to the Maritime Administrator of any material change in ownership, governance, debt covenants, chartering arrangements, or other relationships that could reasonably increase foreign ownership, control, or influence, and shall obtain approval or amended M-SSA terms prior to implementing such change, as provided by regulation. (h) Oversight (1) In general The Maritime Administrator, in coordination with the Secretary of Defense and the Secretary of Homeland Security, shall approve, audit, and monitor covered entities operating under an M-SSA at least annually. (2) Coast guard and department of labor coordination In conducting oversight under paragraph (1), the Maritime Administrator shall coordinate with the Commandant of the Coast Guard on matters implicating vessel documentation, inspection, certification, safety, security, crewing, or credentialing requirements administered by the Coast Guard and the Department of Labor on matters implicating safety requirements administered by the Department of Labor. (i) Breach of terms; remedies (1) Suspension or revocation Breach of M-SSA terms, or material misrepresentation in an application for or performance under an M-SSA, shall be grounds for suspension or revocation of— (A) M-SSA approval; and (B) the eligibility of any vessel operated by the covered entity to qualify under section 55352. (2) Interim measures Pending a final determination, the Maritime Administrator may impose interim mitigation measures, including enhanced reporting, restricted information access, or temporary management controls. (j) Deeming provision; limited scope For the limited purpose of administering this subchapter and any Federal cargo-preference program that expressly incorporates this deeming provision, an entity operating under an approved M-SSA shall be deemed United States-controlled regardless of capital origin, provided such capital is not from a country of concern. Nothing in this subsection shall be construed to confer coastwise trading privileges or to alter any requirement under chapter 551 of this title or any other law governing coastwise trade. (k) Regulations The Secretary of Transportation shall promulgate regulations to carry out this section, including— (1) definitions of control, disqualifying influence, and "security-sensitive decisions; (2) minimum required authorities and procedures for the security committee or equivalent governance mechanism required under subsection (e); (3) audit standards, reporting requirements, and confidentiality protections for sensitive security information; and (4) procedures for expedited review where necessary to support timely implementation of section 55352(l)(3)(A). (l) Rule of construction Nothing in this section shall be construed to— (1) waive or modify vessel documentation, inspection, certification, safety, or security requirements administered by the Coast Guard or the Department of Labor; (2) deem any person or entity a citizen of the United States for purposes of this title, including chapter 121, except for the limited deeming described in subsection (j); or (3) limit any other national security review authority of the United States. 55354. Enforcement and compliance (a) Administration by Federal Maritime Commission (1) In general The Federal Maritime Commission shall administer and enforce this subchapter, including participation targets and any penalties for non-participation established under this subchapter. (2) Regulations Not later than 1 year after the date of enactment of this subchapter, the Commission shall prescribe implementing regulations pursuant to section 46105. Such regulations and final orders under this section shall be treated as issued pursuant to section 46105 for purposes of chapter 158 of title 28. (3) Preservation of vessel qualification determinations The Secretary of Transportation, in consultation with the U.S Trade Representative and Secretary of Commerce, shall retain authority to determine whether a vessel is a qualifying United States vessel (including any determinations involving a Maritime Special Security Agreement or similar mitigation arrangement). The Commission shall accept such determinations as conclusive for purposes of this subchapter. Such determinations shall be made in accordance with sections 55351, 55352, and 55353. (b) Shipper-level compliance duty (1) Requirement Each covered shipper, and each affiliated covered shipper group, shall ensure that its covered movements satisfy the applicable participation targets under this subchapter for each compliance year, as determined by the Commission. The Commission may determine, by regulation or order, to exempt low volume shippers from the requirements of this section if the Commission finds that such exemption will not result in a substantial impact on participation targets. (2) No liability for qualifying u.s. vessel movements A covered movement transported on a qualifying United States vessel shall be treated as compliant and shall not give rise to a non-participation assessment. (3) Measurement and aggregation Compliance shall be measured using existing customs documentation systems and shall be aggregated across each affiliated covered shipper group. (c) Annual certification; disclosure (1) Certification Not later than a date set by regulation (not later than 120 days after the close of each compliance year), each covered shipper shall file with the Commission an annual certification, in such form as the Commission shall prescribe, including— (A) the unique entity identifier of the covered shipper; (B) the identity and unique entity identifier of the ultimate parent entity; (C) a list of affiliated entities sufficient to identify the affiliated covered shipper group; (D) an attestation by a responsible corporate officer, under penalty of perjury, regarding completeness and accuracy; and (E) such shipment-level or aggregated data elements as are necessary to verify compliance using existing customs and shipping documentation. (2) Updates The Commission may require prompt updates upon changes in ultimate parent entity or control. (3) Confidentiality Information submitted under this subsection shall be protected as commercial or financial information to the extent permitted by law. The Commission may publish only aggregated, non-confidential compliance statistics. (d) Verification; interagency coordination (1) Customs integration The Commission shall verify compliance using existing customs documentation, including vessel manifest and cargo declaration information and entry data, without creating a new cargo classification regime. (2) Coordination Not later than 180 days after enactment, the Commission shall enter into memoranda of understanding, as appropriate, with U.S. Customs and Border Protection, the Department of Transportation, the Department of Homeland Security, and the Department of the Treasury to support data access, verification, and collection. (3) Audit; records The Commission may audit covered shippers and affiliated covered shipper groups for purposes of this section and may require retention and production of records sufficient to substantiate certifications. (e) Penalties for non-participation (1) Imposition If the Commission determines, after notice and opportunity for hearing, that a covered shipper or affiliated covered shipper group failed to satisfy applicable participation targets for a compliance year, the Commission shall impose civil penalties equal to not less than 10 percent of the value of the shipper or shipper group’s incoming cargo to the United States in the period of non-compliance. (2) No credit for non-compliance Payment of an assessment under this subsection shall not satisfy, offset, or reduce any participation target applicable in a subsequent compliance year. (3) Nature of assessment An assessment under this subsection is a civil monetary assessment and is in addition to any other civil penalty, customs duty, tax, fee, or remedy available under this subchapter or any other provision of law. (4) Exclusion of compliant movements Covered movements transported on qualifying United States vessels shall not be included in calculating an assessment under this subsection. (5) Delinquency; release of cargo After a final order finding repeated delinquency or evasion, the Commission may require, as a condition of release of additional covered cargo of the covered shipper or affiliated covered shipper group, the posting of payment security in a form acceptable to the Commission and the Secretary of the Treasury, including a surety bond, letter of credit, or cash deposit. (6) Escalation The Commission may impose additional penalties for repeated nonparticipation, evasion, or delinquency, including increased civil monetary penalties, shortened cure periods, and payment-security requirements under subsection (g). (7) Regulations The Commission shall prescribe regulations governing calculation, notice, collection, and mitigation of assessments under this subsection, but may not reduce the statutory minimum percentages established in paragraph (1). (f) Waiver of adjustment The Secretary of Transportation may recommend waivers or reductions of assessments where compliance will materially disrupt critical supply chains during an ongoing national emergency as declared by the President. (g) Civil penalties; false statements (1) In general A person that violates this subchapter or a regulation or order of the Commission under this subchapter, including failure to file a certification, filing of a materially false certification, concealment of covered movements, willful misrepresentation, or evasion, is liable to the United States Government for a civil penalty not to exceed— "(A) $100,000 for each violation; and (B) $250,000 for each violation that is willfully and knowingly committed. (2) Continuing violations Each day of a continuing violation after written notice from the Commission shall constitute a separate violation. (3) Separate offenses Each false material statement, each material omission, each failure to certify, each concealed covered movement, each use of a successor or affiliate to evade this subchapter, and each failure to comply with a payment-security requirement may constitute a separate violation. (4) Procedures The Commission shall provide notice and opportunity for hearing prior to issuance of a final order assessing a penalty or assessment. The Commission may seek injunctive relief under section 41307 of this title in connection with an investigation of alleged violations of this subchapter or a regulation or order of the Commission. (5) Customs penalties preserved Nothing in this section shall be construed to limit the authority of United States Customs and Border Protection to take action under title 19 against any person that makes or causes to be made a materially false statement, act, or omission in customs-related documentation to evade or defeat this subchapter, including under section 1592 of title 19. (6) Seizure and forfeiture Covered cargo introduced into the commerce of the United States through a material false statement, act, or omission to evade or defeat this subchapter is subject to seizure and forfeiture under applicable customs laws. (h) Anti-evasion; attribution; successor and alter-ego; payment security (1) Aggregation Across Affiliates The Commission shall attribute covered movements and aggregate compliance across affiliated covered shipper groups, including common-control affiliates and persons acting in concert in routing, contracting, or payment. (2) Attribution rules The Commission shall by regulation prescribe rules to attribute covered movements using existing customs and shipping documentation, including service contract, bill of lading, and manifest/entry data elements, to the covered shipper and affiliated covered shipper group most directly benefiting from, directing, or controlling such movements. (3) Rebuttable presumptions The Commission shall establish rebuttable presumptions that— (A) movements are attributable to the entity identified as the account party/cargo owner in customs and shipping documentation; (B) movements of a newly formed or thinly capitalized entity with substantially common ownership, management, address, or logistics operations with a covered shipper are attributable to the affiliated covered shipper group; (C) a person that materially reorganizes after notice of investigation acts to evade unless proven otherwise by clear and convincing evidence; and (D) a covered movement routed through an intermediate foreign port or third country shall not be excluded from a designated trade lane solely by virtue of such intermediate routing, and may be attributed and treated as occurring within the designated trade lane based on the shipment’s underlying origin, consignee, and account-party information in existing customs and shipping documentation, as specified by regulation. (4) Successor; alter-ego The Commission may treat a person as a successor or alter ego of another person for purposes of liability for assessments, penalties, and payment security where there is substantial continuity of ownership, management, operations, assets, or purpose, or where the transaction or formation had a principal purpose of evasion. Liability may be joint and several within an affiliated covered shipper group. (5) Payment Security For Repeat Evasion Or Delinquency After a final order finding repeated evasion or delinquency, the Commission may require a covered shipper or affiliated covered shipper group to post and maintain reasonable payment security (including surety bond, letter of credit, or cash deposit) to secure future assessments and penalties for a period not to exceed 2 years, renewable upon a new finding after notice and opportunity for hearing. This paragraph shall not be construed to establish a general licensing regime. (6) No Avoidance By Restructuring The Commission may disregard any corporate form, transfer, conversion, assignment, spin-off, merger, dissolution, reincorporation, change in importer of record, change in beneficial cargo owner designation, change in service contract party, or other restructuring the principal purpose or material effect of which is to avoid compliance with, attribution under, or liability arising under this subchapter. (7) Joint and several liability of controlling persons Where the Commission finds that a predecessor, successor, affiliate, beneficial owner, ultimate parent entity, or controlling person participated in, directed, benefited from, or knowingly facilitated conduct described in paragraph (6), the Commission may impose joint and several liability on such person for assessments, penalties, interest, and payment-security obligations under this subchapter. (8) Control At Less Than Majority Ownership For purposes of this subsection, the Commission may find control notwithstanding section 55351(13) at any ownership level, or through contractual, financial, operational, family, agency, or other relationships, where the facts demonstrate the power to direct routing, contracting, payment, or corporate conduct relating to covered movements. (i) Limited carrier liability; cooperation (1) No carrier compliance duty An ocean common carrier or ocean transportation intermediary, including a non-vessel-operating common carrier, shall not be responsible for a covered shipper’s participation targets or assessments solely by transporting or arranging the transportation of covered cargo. (2) Recordkeeping and production Ocean common carriers and ocean transportation intermediaries shall, as specified by regulation, retain and produce records reasonably necessary to support verification; failure to maintain or produce records, or knowing submission of false records, may be penalized under subsection (f). (j) Transition; effective date (1) Initial compliance year The first compliance year shall begin on the first January 1 that occurs not less than 1 year after the date the Commission issues final regulations under subsection (a)(2), unless otherwise specified by statute. (2) Safe harbor For the first compliance year only, the Commission shall provide a good-faith safe harbor for covered shippers that timely file complete certifications and enter into commercially reasonable arrangements to meet targets, as defined by regulation.. (b) Interagency steering body The Secretary, in consultation with the Secretary of Treasury, Secretary of State, Secretary of Defense, Secretary of Commerce, Secretary of Labor, United States Trade Representative, and Chairman of the Federal Maritime Commission, conduct periodic reviews to evaluate fleet growth, workforce capacity, industrial impacts, and compliance effectiveness. (c) Domestic repair utilization (1) Findings Congress finds the following: (A) The United States ship repair sector constitutes a distinct and strategically critical component of the maritime industrial base and shall not be treated as merely an extension of ship construction. (B) Domestic repair capacity supports routine operational readiness of United States naval forces, sustains commercial fleet availability during peacetime operations, and will be essential to maintaining maritime logistics and sealift capability during periods of contingency, mobilization, prolonged contested logistics operations, or contested operations. (C) Strengthening the ship repair sector represents the most immediate and scalable means of restoring industrial depth because it leverages the existing fleet and workforce rather than future vessel construction pipelines. (2) Domestic repair utilization Chapter 531 of title 46, United States Code, is amended by adding at the end the following new section 53112: 53112. Domestic repair utilization (a) Domestic maintenance and repair requirement (1) In general Beginning not later than 3 years after enactment of this section, Qualified United States Vessels subject to an operating agreement under this chapter must have a percentage of maintenance and repair, as determined by cost, on the vessel conducted in United States shipyards, subject to a determination by the Maritime Administrator of sufficient shipyard capacity. (2) Maintenance and repair targets The Secretary of Transportation shall establish a target of not less than 10 percent of total maintenance and repair expenditures to be performed in United States shipyards, increasing annually by not less than 5 percent, unless the Maritime Administrator determines that available yard capacity, scheduling constraints, or operational readiness considerations warrant adjustment. (3) Implementation In implementing this section, the Secretary shall ensure that— (A) requirements remain subject to verified shipyard capacity, workforce availability, and operational schedules; (B) enhanced domestic repair utilization strengthens workforce continuity, preserves critical maintenance skills, and improves surge sustainment capability supporting national defense; and (C) implementation relies on existing contracting structures and avoids creation of duplicative regulatory regimes. (4) Rule of construction Nothing in this section shall be construed to interfere with the normal flow of commerce or disrupt commercially necessary maintenance cycles. (5) Cost offsets To offset commercially reasonable cost differentials associated with increased domestic repair activity, the Secretary may— (A) subject to the availability of appropriations, adjust stipend amounts paid under vessel operating agreements; and (B) with the concurrence of the Secretary of Defense, allow surcharges to be placed on certain contracts. (6) Waivers The Secretary of Transportation may grant waivers or temporary deviations if— (A) compliance is not commercially feasible; (B) compliance would materially disrupt logistics operations; or "(C) domestic yard capacity is unavailable.. (d) Maritime workforce development (1) Maritime Workforce National Center of Expertise The Secretary of Transportation, in coordination with the Commandant of the Coast Guard and the Secretaries of Labor, Homeland Security, and Defense, shall establish a “Maritime Workforce National Center of Expertise” (the Center). The Center shall serve as a national repository of best practices and provide training, technical assistance, and curriculum development support to maritime academies, trade schools, unions, and other training providers. (2) Functions of center The Center shall develop model curricula for mariner and shipbuilding training, expand simulator training capacity, support the development and expansion of registered apprenticeship programs (RAPS) in shipbuilding occupations and pre-apprenticeship programs that lead to such RAPs, and disseminate proven practices to universities, career and technical schools, and high schools nationwide. The Center shall make recommendations to the Secretaries of Transportation and Labor, and through the Secretaries to Congress, on expanding United States mariner training programs and shipbuilding workforce development. (3) Mariner training finance plan Not later than 180 days after the date of enactment of this Act, the Secretary of Labor and the Secretary of Transportation shall jointly develop plans to maximize the use of federal workforce development and education funds, including Pell, Workforce Pell, JobCorps, WIOA Adult, WIOA Dislocated Worker, and WIOA Youth, Apprenticeship, YouthBuild, and Reentry Employment Opportunities. (4) Review of credentialing requirements The Commandant of the Coast Guard, in consultation with industry representatives, labor unions, and maritime training institutions, shall review merchant mariner credentialing and training requirements and submit to Congress recommendations to streamline and accelerate training approval and credential issuance, while maintaining safety standards. (5) International training partnerships The Secretary of State shall prioritize shipbuilding and mariner training in the Department of State’s educational and cultural exchange programs, in order to strengthen the United States maritime workforce and share best practices with allied nations. (6) Consultation In carrying out this subsection, the Secretary shall consult with maritime labor organizations, industry, State maritime academies, and other training providers. (7) Rule of construction Nothing in this subsection shall be construed to alter the authorities of the Coast Guard with respect to credentialing, safety, or enforcement. (e) General rules of construction (1) No Effect on Coastwise Trade Laws Nothing in this section or the amendments made by this section shall be construed to alter, amend, waive, or supersede chapter 551 of title 46, United States Code, or any other law governing coastwise trade. (2) Preservation of other authorities Nothing in this section or the amendments made by this section shall be construed to limit any authority otherwise available under law to the Federal Maritime Commission, the Department of Transportation, the Maritime Administration, the Coast Guard, the Department of Homeland Security, U.S. Customs and Border Protection, the Department of the Treasury, or the Department of Justice. (3) No private right of action Nothing in this section or the amendments made by this section shall be construed to create a private right of action. (4) Severability If any provision of this section, an amendment made by this section, or the application of such provision or amendment to any person or circumstance is held to be invalid, the remainder of this section, the amendments made by this section, and the application of such provisions and amendments to any other person or circumstance shall not be affected thereby.