46 U.S.C. § 56503 — Types of adjustments and arrangements
submitted 20 years ago by Pub. L. 109-304 to r/title-46-SHIPPING · 386 words · no verdicts yet
This law describes what kinds of relief the Secretary of Transportation can give an essential vessel owner under this chapter — always suspending the vessel's normal operating requirements, and possibly including lay-up payments, delayed debt deadlines, extended time limits, temporary emergency use, or a share of extra profits repaid to the government later.
(a) Suspension Requirements. Any adjustment or arrangement under this chapter must suspend: (1) the requirement to operate the vessel* in foreign trade under its subsidy contract, mortgage, or other agreement; and (2) the vessel's right to operating-differential subsidy payments.
(b) Discretionary Adjustments and Arrangements. Depending on what the Secretary of Transportation thinks fits this subtitle's purposes, an adjustment or arrangement may also include: (1) laying the vessel up, either with the owner or in the Secretary's custody, with the Secretary paying or reimbursing necessary expenses (including reasonable overhead and insurance), or instead paying a fixed periodic allowance; (2) pushing back the due dates on the vessel's debt payments to the government, by up to the total length of the lay-up, or rearranging those due dates; (3) postponing or canceling interest that builds up on those debts during the lay-up; (4) extending, by up to the length of the lay-up, the vessel's 20-year life limit and other limits based on that 20-year life; (5) allowing temporary or emergency use of the vessel instead of laying it up, under management terms the Secretary approves, with that period of use counted as part of the lay-up period; and (6) requiring the owner, once the arrangement ends, to pay the Secretary any net profits earned above a 10 percent yearly return on the capital used in the business, as repayment for the debts postponed or canceled and expenses the Secretary covered.
(c) Laid-Up Vessels. When calculating that 10 percent return under subsection (b)(6), the value of the owner's laid-up or operated vessel counts as capital used in the business. The Secretary may require the vessel to serve as security guaranteeing this repayment.
An adjustment or arrangement under this chapter shall include suspension of—
the requirement to operate the vessel* in foreign trade under the applicable operating-differential or construction-differential subsidy contract or mortgage or other agreement; and
the right to operating-differential subsidy for the vessel.
To the extent the Secretary of Transportation considers appropriate to carry out the purposes of this subtitle, an adjustment or arrangement under this chapter may include any of the following:
Lay-up of the vessel by the owner or in the custody of the Secretary, with payment or reimbursement by the Secretary of necessary and proper expenses (including reasonable overhead and insurance) or a fixed periodic allowance instead of payment or reimbursement.
Postponement, for not more than the total period of the lay-up, of the maturity date of each installment of the principal of obligations to the United States Government for the vessel (regardless of whether the maturity date is during a lay-up period), or rearrangement of those maturities.
Postponement or cancellation of interest accruing on the obligations during a lay-up period.
Extension, for not more than the total period of the lay-up, of the 20-year life limitation for the vessel and other limitations and provisions of this subtitle based on a 20-year life.
Provision for temporary or emergency employment of the vessel (instead of lay-up) as may be practicable, with such arrangements for management of the vessel, payment of expenses, and application of the proceeds of the employment, as the Secretary may approve, with any period of operation being included as part of the lay-up period.
Payment to the Secretary, on termination of the arrangements with the applicant, of the applicant’s net profits (earned while the arrangements were in effect) in excess of 10 percent a year on the capital necessarily employed in the applicant’s business, as reimbursement for obligations postponed or canceled and expenses incurred or paid by the Secretary under this section.
Under subsection (b)(6), capital of the applicant represented by a vessel of the applicant laid-up or operated under this section shall be included in capital necessarily employed in the applicant’s business. The Secretary may require a vessel laid-up or operated under this section to be security for reimbursement.
Source credit: (Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1657.)
- 2006Enacted · Pub. L. 109-304 · 120 Stat. 1657
A history note hasn’t been published yet. The record shows enactment by Pub. L. 109-304 on 2006-10-06.
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