Category: Marine Regulation

One-Way Ratchet and a Different Kind of Pastry: Trump Tariffs at the Supreme Court

Keith B. Letourneau ●

On November 5, 2025, the Supreme Court heard oral argument in the consolidated tariff cases. This article addresses a few notable points made during the argument and examines the underpinnings of each. On balance, it appears the Supreme Court will not uphold the reciprocal and fentanyl tariffs imposed by the president under the International Emergency Economic Powers Act (“IEEPA”), though there are other more complicated means to a similar end. The Court’s decision is expected early this year.

Justice Barrett inquired of Solicitor General Sauer (“SG”) where there is any other place in the United States Code where the words “regulate importation” confer tariff-imposing authority. The SG noted it exists in the Trading with the Enemy Act (“TWEA”) as interpreted in Yoshida and IEEPA. In Yoshida, the Court of Customs and Patent Appeals held that President Nixon had the authority to impose a 10 percent import duty surcharge under TWEA’s authority to “regulate … importation.” Nevertheless, Yoshida made clear that each presidential proclamation must be evaluated on its own facts and circumstances. In that case, the measure issued under TWEA was temporary; it did not supplant the entire tariff scheme of Congress and did not apply to all imports, but only those imports already subject to tariffs. Yet, despite such limitations, the Yoshida court recognized that there was a broad grant of authority under TWEA, and said, “[t]hough such a broad grant may be considered unwise, or even dangerous, should it come into the hands of an unscrupulous, rampant president, willing to declare an emergency when none exists, the wisdom of a congressional delegation is not for us to decide.”

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White House Announces Multiple Trade Deals Following President Trump’s Tour of Asia

Timothy J. Hruby, Alan G. Kashdan, Christopher A. Kimura, and Rachel D. Evans ●

In late October 2025, President Donald Trump embarked on a weeklong tour of Asia and returned having secured a temporary truce in the U.S.-China trade war, and a number of economic deals with Japan, South Korea, Cambodia, Malaysia, Thailand, and Vietnam.

These deals demonstrate not only a strengthening of trade and investment ties between the United States and Asia, but also underscore the need for companies to track diplomatic developments that may impact their supply chains, especially those for sensitive technologies and scarce resources.

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The Limitation Act in the United States: A Deeper Look

Thomas H. Belknap Jr., Emma C. Jones, and G. Evan Spencer ●

This article follows on a 2021 MAINBRACE article, “The Gateway to Federal Court: Admiralty Jurisdiction and Limitation of Liability,” which discussed the practical use of the Shipowners’ Limitation of Liability Act, 46 U.S.C. § 30501, et seq. (“Limitation Act” or the “Act”) in admiralty cases in U.S. Federal Courts. Following a recent Marine Casualty Seminar where the authors presented on this topic, this article will expand on the scope of the Limitation Act and provide more detail on the process for a limitation proceeding pursuant to the Limitation Act. 

Substantive Characteristics of the Shipowner’s Limitation Act

A vessel owner may be able to limit its liability to the vessel’s post-casualty value plus then-pending freight (the “limitation fund”) if it did not have knowledge or privity of the acts of negligence or conditions of unseaworthiness that caused the incident. Whether a potential limitation petitioner is an owner able to limit its liability depends on the degree of control the putative owner exercises over the manning, operation, and navigation of a vessel. This means that entities other than the registered owner may be entitled to limit liability, including vessel managers, shareholders of a vessel-managing entity, former vessel owners, trusts holding legal title, and others. To evaluate whether a given entity may be able to limit liability, it is best to start with the question: Is this entity subject to shipowner’s liability because of its exercise of control over the vessel? If so, that entity should be a proper limitation petitioner. 

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V.O.S. Selections, Inc. and the Sword of Yoshida

By way of executive order, the Trump administration has imposed tariffs on its global trading partners under the International Emergency Economic Powers Act (“IEEPA”), which gives the president powers to deal with national emergencies stemming from “any unusual and extraordinary threat” that comes in whole or in large part from outside the United States. The tariffs have taken two forms: targeted tariffs against China, Mexico, and Canada relating to the importation of illegal narcotics (fentanyl) into the United States (though little evidence supports any such importation from Canada); and so-called “Reciprocal Tariffs” pertaining to perceived trade imbalances, which have been implemented as of August 7, 2025, against nearly all countries with any significant trade relationship with the United States, except as otherwise negotiated through bilateral trade deals with individual nations.

In V.O.S. Selections, Inc. v. United States, the Court of International Trade (“CIT”) combined challenges from various shipping importers and 12 states arguing that these tariffs are unconstitutional and violative of U.S. law, and that such tariffs require congressional approval. On May 28, 2025, the CIT ruled that IEEPA’s statutory authority for the president to “regulate . . . importation” does not extend to imposing unlimited tariffs under the Supreme Court’s major questions doctrine, which limits federal agencies from broadly construing their powers from vague or implied grants of authority, or the Trade Act, which limits tariffs imposed to respond to balance of payment problems to 15 percent and a maximum duration of 150 days. These tariffs also require an extensive investigation by the U.S. Trade Representative before implementation, which has not occurred. The CIT also ruled that Congress cannot delegate such unlimited power under the Constitution, which assigns Congress the exclusive powers to “lay and collect Taxes, Duties, Imposts and Excises,” and to “regulate Commerce with foreign Nations.” Quoting Supreme Court precedent addressing the nondelegation doctrine, the CIT noted that delegation of such authority, of course, is permitted “as long as Congress ‘lay[s] down by legislative act an intelligible principle to which the person or body authorized to [exercise that authority] is directed to conform,’” which means when Congress “meaningfully constrains” the president’s authority. 

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The FMC Announces Investigation into Flags of Convenience and Unfavorable Conditions Created by Flagging Practices

Matthew J. Thomas, Jeanne M. Grasso, Kierstan L. Carlson, Natalie M. Radabaugh ●

The U.S. Federal Maritime Commission (“FMC”) announced on May 21, 2025 that it is initiating a non-adjudicatory investigation into whether the: 1) vessel flagging laws, regulations, and/or practices of certain foreign governments, including the so-called flags of convenience, or 2) competitive methods employed by owners, operators, agents, or masters of foreign-flag vessels, are creating unfavorable shipping conditions in the foreign trade of the United States.

The investigation includes a 90-day public comment period, which ends on August 20, 2025. 

FMC’s “Section 19” Trade Authority

Section 19 of the Merchant Marine Act of 1920, 46 U.S.C. § 42101 et seq., authorizes the FMC to evaluate conditions that affect shipping in the U.S. foreign trade and to issue regulations or take action to address such conditions. Potential remedies include port fees up to one million dollars, limits on voyages to and from U.S. ports or the amount or type of cargo carried, and other trade restrictions.

The FMC exercised this authority frequently in the 1980s and 90s (before the sell-off of the major U.S. liner operators to foreign buyers) to force market-opening concessions and eliminate discriminatory fees and trade barriers that impeded U.S. shipping companies’ competitiveness overseas. However, these powers have been left nearly dormant for the past two decades.

The current investigation does not target particular flag States or propose any remedial measures; rather, it is a non-adjudicatory investigation pursuant to 46 C.F.R. Part 502, Subpart R, which allows the FMC to request information, conduct hearings, issue subpoenas, conduct depositions, and issue reports, at its discretion.

To read or download the full client alert, please visit our website.

Navigating Emission Control Areas: Operational, Legal, and U.S. Enforcement Risks of MARPOL Annex VI’s Low Sulphur Fuel Requirements

Luke M. Reid, Jeanne M. Grasso, and Holli B. Packer ●


The North American Emissions Control Area (“ECA”), which has been in force well over a decade, is one of four existing ECAs around the world. Effective May 1, 2025, the Mediterranean Sea ECA will become the fifth. In March 2026, pursuant to MARPOL Annex VI, Regulation 13, the Canadian Arctic and Norwegian Sea will also be designated as ECAs, increasing the global total to seven. These two ECAs will become enforceable on March 1, 2027. In addition to these ECAs, other port States around the world have separately implemented domestic emissions control regulations in their territorial seas, with China being a prominent example.

The establishment of these new ECAs and similar emissions control regimes throughout the world will result in an increasing number of vessels crossing ECA boundaries—sometimes multiple times on a single voyage—and on a more frequent basis. The use of different fuel types has in more and more cases led to operational and safety challenges, which has inevitably translated into heightened legal and enforcement risks. Given this expansion of ECAs worldwide, and the growing patchwork of other related port State emissions requirements, it is more important than ever to revisit the various legal and operational risks that have emerged over time, particularly those in the United States, to ensure compliance and mitigate potential risks.

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The SHIPS Act: The Advent of a New U.S. Merchant Marine Fleet?

Keith B. Letourneau ●

In December 2024, Senator Scott Kelly (D. AZ), Representative Todd Young (R. IN), and then Representative Mike Waltz (R. FL) (now the President’s National Security Advisor) co-sponsored a bill to revamp shipbuilding in the United States. Titled the Shipbuilding and Harbor Infrastructure for Prosperity and Security (“SHIPS”) Act, the bill did not pass in the 118th Congress, but every expectation is that it will be introduced again in 2025. In that event and should Congress enact it, the SHIPS Act will fundamentally transform shipbuilding in the United States.

At one point during World War II, the United States’ capacity to build ships was truly phenomenal. The Liberty ship SS ROBERT E. PEARY was built in four days, 15 hours, and 29 minutes. Three new Liberty ships were launched every day in 1943; over 2,700 were built during the War, in addition to over 9,000 naval vessels. By contrast, in 2022, the United States built five merchant ships, and in 2024, commissioned two U.S. Navy ships. Currently, there are only about 90 U.S. flag vessels participating in international commerce, which is supported by a global fleet of more than 110,000 merchant ships.

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Cybersecurity in the Marine Transportation System: What You Need to Know About the Coast Guard’s Final Rule

Dana S. Merkel, Vanessa C. DiDomenico, and Holli B. Packer ●


On January 17, 2025, the U.S. Coast Guard (“USCG”) published a final rule addressing Cybersecurity in the Marine Transportation System (the “Final Rule”), which seeks to minimize cybersecurity related transportation security incidents (“TSIs”) within the maritime transportation system (“MTS”) by establishing requirements to enhance the detection, response, and recovery from cybersecurity risks. Effective July 16, 2025, the Final Rule will apply to U.S.-flagged vessels, as well as Outer Continental Shelf and onshore facilities subject to the Maritime Transportation Security Act of 2002 (“MTSA”). The USCG also sought comments on a potential two-to-five-year delay of implementation for U.S.-flagged vessels. Comments were due March 18, 2025.

Background

The need for enhanced cybersecurity protocols within the MTS has long been recognized. MTSA laid the groundwork for addressing various security threats in 2002 and provided the USCG with broad authority to take action and set requirements to prevent TSIs. MTSA was amended in 2018 to make clear that cybersecurity related risks that may cause TSIs fall squarely within MTSA and USCG authority.

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USTR Seeks Public Comment on Proposed Action in Section 301 Investigation of China’s Targeting of the Maritime, Logistics, and Shipbuilding Sectors

Matthew J. Thomas, Kathleen H. Shannon, and Natalie M. Radabaugh ●


The Office of the United States Trade Representative (“USTR”) announced its proposed actions under Section 301 of the Trade Act of 1974 (“Section 301”), in connection with its Investigation of China’s Targeting of the Maritime, Logistics, and Shipbuilding Sectors for Dominance (the “Proposed Action”) on February 21, 2025. 

In short, the Proposed Action includes a variety of recommended remedies, including (1) imposing significant port fees on Chinese vessel operators and other operators of Chinese-built vessels, and operators with orders for new vessels being built in Chinese yards, and (2) implementing requirements for mandatory use of U.S.-flag and U.S.-built vessels to carry fixed percentages (increased annually) of U.S. exports. 

At this time, the Proposed Action is not final and USTR is seeking public comment by March 24, 2025, as discussed further below. Given the role that ocean transportation plays in the economy, the Proposed Action would have far-reaching effects to the extent it is adopted. Accordingly, vessel owners and operators and other interested parties in the industry should consider commenting on the Proposed Action and/or appearing at the upcoming hearing with respect to how the Proposed Action may affect them and their industry. In addition, at a minimum, shipowners, operators, charterers, and shippers should start considering their operations, contracts, and how the Proposed Action may affect them. 

To read or download the full client alert, please visit our website.

Cybersecurity in the Marine Transportation System: What You Need to Know About the Coast Guard’s Final Rule

Dana S. Merkel, Vanessa C. DiDomenico, and Holli B. Packer ●


The U.S. Coast Guard (“USCG”) published a final rule on January 17, 2025, addressing Cybersecurity in the Marine Transportation System (the “Final Rule”), which seeks to minimize cybersecurity related transportation security incidents (“TSIs”) within the maritime transportation system (“MTS”) by establishing requirements to enhance the detection, response, and recovery from cybersecurity risks. Effective July 16, 2025, the Final Rule will apply to U.S.-flagged vessels, as well as Outer Continental Shelf and onshore facilities subject to the Maritime Transportation Security Act of 2002 (“MTSA”). The USCG is also seeking comments on a potential two-to-five-year delay of implementation for U.S.-flagged vessels. Comments are due March 18, 2025.

Background

The need for enhanced cybersecurity protocols within the MTS has long been recognized. MTSA laid the groundwork for addressing various security threats in 2002 and provided the USCG with broad authority to take action and set requirements to prevent TSIs. MTSA was amended in 2018 to make clear that cybersecurity related risks that may cause TSIs fall squarely within MTSA and USCG authority.

Over the years, the USCG, as well as the International Maritime Organization, have dedicated resources and published guidelines related to addressing the growing cybersecurity threats arising as technology is integrated more and more into all aspects of the MTS. The USCG expanded its efforts to address cybersecurity threats throughout the MTS in its latest rulemaking, publishing the original Notice of Proposed Rulemaking (“NPRM”) on February 22, 2024. The NPRM received significant public feedback, leading to the development of the Final Rule.

Final Rule

In its Final Rule, the USCG addresses the many comments received on the NPRM and sets forth minimum cybersecurity requirements for U.S.-flagged vessels and applicable facilities.

To read or download the full client alert, please visit our website.