Cargo Preference: Remaining Compliant with US Shipping Regulations

The Cargo Preference Program, administered by the United States Maritime Administration (MARAD), places stipulations on the documentation of imports and exports. Understanding how to meet Cargo Preference compliance, then, involves first becoming familiar with MARAD and its mission.

A Department of Transportation agency concerned with waterborne transportation, MARAD acts as the governing body behind the enforcement of the Cargo Preference Program. Its main goal is to promote waterborne transportation and its integration with other arms of the transportation system; it also supports the feasibility of the U.S. merchant marine.

Some of the areas in which MARAD is concerned include shipping, ship building, port operations, vessel operations, the environment, national security and safety. MARAD is also tasked with monitoring and maintaining the health of the merchant marine, since commercial mariners, vessels, and intermodal facilities are vital for supporting national security.

What is Cargo Preference?

The Cargo Preference Act seeks to promote and facilitate maritime transportation while encouraging the efficient movement of goods and people within the U.S. It manages the administration of and compliance with U.S. Cargo Preference laws and regulations. In short, the Cargo Preference Act requires maritime shippers to use U.S-flag vessels to transport any government-impelled waterborne cargo, where government–impelled cargo is described as cargo that is moving as a direct result of government involvement, indirectly through financial sponsorship of a Federal program or in connection with a guarantee provided by the Federal Government.

The basic aim of the Cargo Preference Act is to provide an incentive that will retain and bolster privately owned and operated U.S.-flag merchants. Cargo Preference exists because MARAD realizes the importance of U.S.-flag merchants in providing:

  • Essential sealift capability in wartime or other national emergencies,
  • Skilled seafarers available in time of national emergencies, and
  • Help to protect United States ocean commerce from total foreign domination and control.

MARAD stipulates a specific percentage of cargo to be carried on U.S.-flag vessels outlined below:

  • Military Cargo = 100% (governed by Military Cargo Preference Act of 1904)
  • Export Import Bank = 100% (governed by Public Resolution 17)
  • Civilian Agencies Cargo = at least 50% (governed by Cargo Preference Act of 1954)
  • Agricultural Cargoes = at least 50% (governed by the Cargo Preference Act of 1954)

Cargo Preference Program Forms

Someone who is the owner/operator of a U.S.-flag vessel or vessels and actively participating in the Cargo Preference program must submit annual vessel operating and capital cost information. Both these forms are available on the MARAD website electronically. These forms are the:

  • Cargo Preference Schedule 310
  • Cargo Preference MA-1025

While the website recommends the online submission of forms, they also provide a means to submit forms by mail.

Document Management Systems and Cargo Preference Forms

As mentioned above, your forms may be sent by traditional snail mail to the address provided on the website. The problem with traditional mail is that forms and documents can be lost. With eFileCabinet’s document management system, lost files can be easily resent since all forms and documents are regularly backed up on the cloud using the latest cloud-based technology. Not only do cloud backups safeguard against lost mail, but your forms are also guarded against fires, theft, hard drive failures and natural disasters.

eFileCabinet keeps all files safe and secure using the latest security measures including heavy 256-bit encryption, SAS 70 type II secured data centers, websites secured with SSL certificates and multiple layers of physical intrusion detection systems.

eFileCabinet can also help reduce clutter in your home and office by eliminating the need for printing. All files stored on the DMS can be easily located using the powerful built-in search functions. Forms stored in the system can be searched by file name or by keywords.

Best of all, all of your forms can be easily accessed online via PC with eFileCabinet Online or even via mobile using eFileCabinet’s mobile app. This means that you can pull up your completed forms on demand from any location.

Using a DMS to store all your forms can offer a wide range of benefits. To learn more about eFileCabinet and how it can be used to manage your Cargo Preferences documents, fill out the form provided for a free 15-minute demo.

By | 2016-12-15T11:58:39+00:00 January 19th, 2016|
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