MP takes aim at Australia's Jones Act

A member of Australia's parliament wants to lower what he calls the "unnecessary costs for shippers, and consumers" brought about the country's domestic cabotage laws.

At issue is the"temporary licence" that allows non-Australian flagged vessels to conduct coastwise voyages in the country. MP Darren Chester reintroduced a bill in the lower house this week that "limits the use of shipping to move domestic freight."

The current laws "are pushing costs up for businesses," Chester said in a speech before parliament.

His push echoes that of US Senator John McCain, who has sought to dial back parts of the US cabotage law known as the Jones Act. His latest effort includes removing the US build requirement for ships in the domestic trade.

The Jones Act is once again in focus as US officials issued a temporary waiver to the rule for tankers supplying the US Gulf Coast. So far, the US Customs and Border Protection says it received one waiver request.

Australia's coastal fleet declines

Chester's bill seeks to give the country similar flexibility by allowing temporary licences to be issued in emergency situations. Overall, the bill seeks to ease many of the restrictions on foreign flag vessels face in getting temporary licences.

Analysis of the bill highlights the continued shrinking of the country's domestic coastal shipping industry. Only 14 ships have coastal licences in Australia, down from 30 a decade ago.

There is an oversupply of Australian seafarers and a lack of training berths on Australian vessels. Also, customers face "significant cost disadvantage" if compelled to use an Australian ship over a foreign ship.

The effort though faces opposition from Australian seafarers. Paddy Crumlin of the Maritime Union of Australia says the proposed changes make it more difficult for Australian ships to compete in the coastal trade.

“Without strong rules, Australian companies have to compete with cheap, exploited foreign labour on flag of convenience vessels, the owners of which pay no tax and often flout safety laws,” Crumlin said in a statement.