The Jones Act: its effect on the U.S. response to the 2010 BP Deepwater Horizon oil spill and its relevance in international law.

• Published date: 01 January 2012
• Author: Conley, Joseph M.
• Date: 01 January 2012

I. INTRODUCTION

On April 20, 2010, the BP Deepwater Horizon oil rig burst into flames in the Gulf of Mexico. (1) Of the 126 people on board the platform, seven workers were critically injured and eleven went missing. (2) The rig leaked until September 19, 2010, (3) spilling an estimated total of five million barrels of oil into the Gulf of Mexico, (4) making it the largest accidental (5) oil spill in history. (6) Citizens along the Gulf Coast in Louisiana, Mississippi, Alabama, and Florida feared that the spill would threaten, if not destroy, their way of life. (7)

The U.S. federal government and President Obama received heavy criticism from politicians and the media for a seemingly slow response to the disaster. (8) In particular, critics alleged that the United States, at least initially, refused the aid of cleanup vessels from foreign nations, such as the Netherlands, Belgium, and Norway. (9)

A number of media sources and conservative Republicans began reporting that the [section] 27 of the Merchant Marine Act of 1920, (10) known as the Jones Act, hampered the cleanup efforts. (11) The Act essentially protects the merchant marine industry by requiting that only American-owned and flagged ships, with primarily American crews, transport goods between American ports. (12) Politicians argued over the correct interpretation of the Jones Act and whether it legitimately affected the United States' ability and willingness to accept offers from foreign nations to help with the cleanup. (13)

The purpose of this Note is to examine how, if at all, the Jones Act affected the BP spill cleanup efforts, and whether the Act continues to serve a purpose. Part II of this Note provides an overview of the Jones Act. Part III of this Note examines whether the portion of the Jones Act at issue actually hindered the timely acceptance of aid from foreign vessels. Part IV compares the Jones Act with similar laws in countries that have experienced oil spills to evaluate the effect maritime cabotage laws (14) have had on oil spill cleanup efforts. Part V examines the portion of the Act allegedly affecting the clean up response to determine if those portions should be repealed, modified, or remain unchanged. From that analysis, this Note concludes that the Jones Act, which remains effective law, did not hinder the United States' ability to accept aid from foreign vessels in response to the BP Deepwater Horizon oil spill.

II. A BRIEF OVERVIEW OF THE JONES ACT

Maritime cabotage laws have been part of the U.S. legal landscape since the nation's founding. (15) The Merchant Marine Act of 1920 is a U.S. federal statute that regulates maritime commerce in U.S. waters and among U.S. ports. (16) The Act was "created to encourage development of American merchant marine for national defense and commercial purposes." (17) However, agricultural groups generally oppose it, for they argue that it increases shipping costs, in turn weakening American farmers' ability to compete internationally. (18) Others critiquing the Act question whether the Jones Act is even necessary when laws such as "the Immigration and Nationality Act, the Fair Labor Standards Act, and the Internal Revenue Code would apply ... to anyone engaged in U.S. interstate commerce." (19) The Merchant Marine Act [section] 27 is commonly referred to as the Jones Act (20) and regulates maritime cabotage laws. The provisions under [section] 27 require that all goods transported by water between U.S. ports be carried by U.S.-flagged ships that are constructed in the United States, owned by U.S. citizens, and crewed by U.S. citizens and permanent residents. (21) The Act reads:

[A] vessel may not provide any part of the transportation of merchandise by water, or by land and water, between points in the United States to which the coastwise laws apply, either directly or via a foreign port, unless the vessel--

(1) is wholly owned by citizens of the United States for purposes of engaging in the coastwise trade; and

(2) has been issued a certificate of documentation with a coastwise endorsement under chapter 121 or is exempt from documentation but would otherwise be eligible for such a certificate and endorsement. (22)

The Jones Act is the only provision in the U.S. code concerning cabotage containing the U.S.-build requirement. (23) This requirement does not exist in "other U.S. cabotage modes of transportation, such as aviation or rail." (24) The condition requiring that ships are owned and operated by U.S. coastwise citizens is also exclusive to the Jones Act. (25) Despite the unique yet controversial provisions, the Jones Act has fundamentally stayed the same since 1920. (26)

III. DID THE JONES ACT ACTUALLY HINDER THE RELIEF EFFORT?

A close examination of the plain language of the Jones Act and various media and government reports demonstrates that the statute did not cause a delay in the acceptance of aid from foreign vessels.

The plain language of the Jones Act suggests that it does not apply to foreign vessels assisting in the cleanup effort. First, the statute addresses vessels engaged in the "transportation of merchandise." (27) To qualify as merchandise covered by the Jones Act, the owners of the product must be the U.S. government or a state or local government within the United States. (28) In this scenario, who owned the oil at the time of the spill is unclear, but the oil is arguably owned by BP since BP is the company that would profit from the sale of the oil after reaching a U.S. port. (29) There is no indication or existing court ruling that states oil waste, or unusable oil, recovered by a skimming vessel qualifies as merchandise under the Jones Act. (30) Rather, oil waste falls under the definition of other types of waste, such as sludge. (31) In 1982, Congress amended the Jones Act to "include within its ambit, hazardous waste to be incinerated at sea." (32)

Second, this portion of the Jones Act applies to vessels used for "purposes of engaging in the coastwise trade." (33) While "coastwise trade" is defined in the statute, (34) "trade" itself is not. U.S. federal courts have generally defined it as trade "between points in the United States, including Districts, Territories, and possessions thereof embraced within coastwise laws." (35) Thus, this definition of trade does not address whether skimming for oil and bringing it back to shore constitutes a form of trade.

Third, a portion of the Act directly addresses vessels responding to oil spills. (36) It states that "an oil spill response vessel documented under the laws of a foreign country may operate in waters of the United States on an emergency and temporary basis, for the purpose of recovering, transporting, and unloading in a United States port oil discharged as a result of an oil spill in or near those waters." (37)

Simply, nothing in the plain language of the Jones Act implies that it prevented the United States from accepting aid from foreign vessels during the BP Deepwater Horizon oil spill.

In addition to the plain language of the Act permitting the use of foreign ships, the vast space over which the oil spill spread also means that the Jones Act did not apply to foreign vessels assisting in the cleanup. The initial blast on the Deepwater Horizon oil rig occurred approximately fifty miles from shore. (38) By May 25, 2010, BP estimated that a total of seven million gallons of oil had spilled into the Gulf. (39) Traditionally, U.S. sovereignty over coastal waters extends three nautical miles from the coast. (40) Much of the oil was not within the three mile limit controlled by the United States; rather, the oil had dispersed into the "high seas," a term referring to waters not controlled by any single nation. (41) On its face, the Jones Act does not apply to ships that are beyond U.S. waters. Consequently, the Act would not apply to ships that are cleaning up oil beyond three nautical miles from the U.S. shore. (42)

In addition to presuming that the Jones Act was a barrier to foreign assistance, media and news sources have reported conflicting information as to whether foreign aid was used in the cleanup process. (43) Multiple blogs run by mainstream media sources such as Fox News and the Wall Street Journal reported that the United States did not accept foreign aid. (44) For example, the Wall Street Journal published a short blog article blaming the "protectionist" Jones Act for delays. (45) The article suggested that "clean-up crews have had to outfit American ships with skimming technology airlifted from the Netherlands" in order to "circumvent the Jones Act." (46)

The proposition that the Jones Act impeded the cleanup process has been widely refuted by government officials, independent researchers, and industry groups. According to a June 2010 statement released by the National Incident Command in charge of the cleanup efforts, there is no indication that the federal government refused any offers of assistance from foreign vessels. (47) Coast Guard Admiral Thad Allen, also in June 2010, addressed the Jones Act issue, stating that the Coast Guard has "not seen any need to waive the Jones Act as part of this historic response...." (48) Nevertheless, Allen also addressed the prospect of granting waivers to foreign vessels in the event that waivers were deemed necessary: Allen and his team developed "specific guidance to ensure accelerated processing of requests for Jones Act waivers should they be received as a part of the BP oil spill response." (49) The guidance directed waivers related to the BP oil spill response to go through the Federal On-Scene Coordinator, who would then immediately forward requests through the National Incident Commander for expedited clearance. (50) Despite the implementation of this system, Allen declared that he had not received any requests for Jones Act waivers from foreign countries as of June 15, 2010. (51)...