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Saturday, January 09, 2016
Sorry OHA, Free Trade Zones are not free of the Jones Act
By Michael Hansen @ 5:15 PM :: 4507 Views :: Akaka Bill, Jones Act, OHA

by Michael Hansen, Hawaii Shippers Council, January 8, 2016

Hawaii Business Magazine published in its January 2016 issue an article entitled “Change Agents” profiling four Hawaiian Sovereignty activists and describing their visions for Hawaii. In a statement attributed to Kamanaopono Crabbe, Chief Executive Officer (CEO), the Office of Hawaiian Affairs (OHA), he asserted that Foreign Trade Zones (FTZ)s in the United States are exempt from the Jones Act.

This is simply not true, all U.S. FTZs are embraced by the coastwise laws of the U.S. including the Jones Act (Section 27 of the Merchant Marine Act of 1920 as amended).

This can be verified by contacting the U.S. Customs and Boarder Protection (CBP) Vessel Entry & Clearance Office in Honolulu at telephone number (808) 522-8012. The CBP controls the entry and removal of merchandise in respect of FTZs and enforces the coastwise laws of the U.S.

This notion that U.S. FTZs are exempt from the Jones Act is a fairly widespread misconception especially among certain proponents of Hawaiian Sovereignty.

Key excerpts:

Control of infrastructure like airports and harbors could mean more than just revenue for a new government, notes Crabbe. “We could develop, for example, our own free-trade zone and, through that free-trade zone, we could import commodities or products to Hawaii, bypassing the Jones Act,” which restricts foreign-flagged ships from sailing between American ports. That requirement is often blamed for high-shipping costs between the U.S. mainland and Hawaii because American-built and -owned ships with American crews must be used.

A Hawaiian government with jurisdiction over one or more ports could facilitate the import of lower-cost food, building materials, vehicles and other commodities, Crabbe says. “Bypassing the Jones Act would benefit not just Native Hawaiians, but the rest of Hawaii.”

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