Stricter Controls For Foreign-Owned Offshore Vessels

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US Senator Bill Cassidy introduced the American Offshore Worker Fairness Act. The bill provides a level playing field between U.S. flagged vessels and foreign-flagged vessels working in offshore energy activities in U.S. waters, reports Safety4Sea.

What is the main motive behind the changes?

The changes aim to improve the oversight of foreign-flagged vessels and the mariners who work on these vessels.

“U.S. and Louisiana mariners and maritime companies lose when foreign vessels, which do not pay U.S. taxes, business taxes or payroll taxes, take advantage of loopholes to hire foreign workers for half the cost. This bill levels the playing field to give the American worker a fair shot”, said Dr. Cassidy.

Closing the loop holes

The bipartisan bill closes an Jones Act loophole so that foreign-flagged vessels are held to the same high standards as US-flagged vessels, added Representative Garamendi.

The American Offshore Worker Fairness Act ensures that when foreign vessels operate in U.S. waters, they play by our rules and pay U.S.-level wages

About the current law and its exemptions 

Current law requires that all vessels, rigs, platforms, or other offshore structures be manned by U.S. citizens or lawful permanent residents. Existing law also includes an exemption from hiring Americans or lawful permanent residents for offshore activities and allows vessels that are more than 50% foreign-owned to operate in U.S. waters with foreign crews.

The exemption was included to eliminate potential retaliation by foreign nations against American workers in foreign offshore activities. In practice, the exemption has not provided reciprocal access to foreign waters for U.S. mariners but has instead created a loophole that allows foreign vessels from some of the wealthiest countries in the world to utilize mariners not from their home or flag nation, but from low-wage nations.

Since labor is the biggest operational expenditure for a vessel operator, operators rely on foreign mariners. Foreign mariners are often paid 14 to 70% less than their U.S. counterparts.

Because foreign mariners are not subject to U.S. tax and labor laws, foreign vessels owners are able to leverage the cost savings derived to undercut the charter rates of similar U.S. vessels.

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Source: Safety4Sea

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