Revisions Needed in Regulations Governing Use of Foreign-Flag Ocean Transportation

LCD-78-231: Published: Aug 18, 1978. Publicly Released: Aug 18, 1978.

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The Merchant Marine Act of 1936, as amended, required the use of American-flag ships for the transportation of effects of Government employees unless the necessity of the employee's mission required the use of foreign-flag ships. Foreign Service Travel Regulations prohibit the use of American-flag transshipment service where direct foreign-flag service is available. Revisions in these provisions are now warranted because of the increased use of container service in shippping. Two shipments examined showed that the use of foreign-flag vessels did not offer any advantages over using American-flag containerships. The adverse effects which result from transshipping under break-bulk shipping practices do not exist under containership operations. State Department regulations which authorize use of foreign-flag ships, where the alternative is American-flag service via transshipment, should be revised. Justification of use of foreign-flag vessels could be used on a standard of a 30-day delay in arrival of goods.

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