Proposed law could torpedo cruises from U.S. ports, including Seattle

Cruise ships, including those sailing from Seattle to Alaska, could face dramatic changes in itineraries under proposed new U.S. regulations.

Most cruise liners would be required to stay 48 hours at foreign ports, instead of the token visits that are used now to meet an existing law. Also, many popular cruise routes would have to be reconfigured if the regulations take effect. For example, Caribbean cruises from New York and New Jersey might have to eliminate some popular stops, while Alaska-bound cruises from Seattle could be compelled to make long port stops in British Columbia or drop Seattle as their starting port and switch to Vancouver, B.C. Cruises from San Diego to Hawaii, which currently make a very brief stop in Mexico, also would be affected.

Critics of the proposal say the changes would devastate the cruise industry, cost thousands of jobs and imperil ports that depend on the travel trade. It's unclear when the proposed federal regulations could be imposed or modified.

"The proposal would cause immediate, significant economic harm to the U.S. port industry," said Kurt Nagle, president of the American Association of Port Authorities.

Seattle's cruise industry has boomed in the last decade with five cruise companies offering weeklong cruises between Seattle and Alaska during this year's cruise season which begins in the spring. More than 200 cruise ship visits and nearly 754,605 passengers are expected this year, according to the Port of Seattle.

Maritime officials, however, insist that cruise regulations need to be changed to prevent foreign-flagged ships from gaining an unfair advantage over American vessels.

The proposed revisions in customs regulations stem from a Pacific Ocean tempest involving a 19th-century U.S. law and the cruise lines that serve Hawaii.

The Passenger Vessel Services Act of 1886 was a stroke of protectionism designed to give American merchant ships a monopoly on U.S. coastline trade, including passenger travel, by putting restrictions on foreign carriers. Under the law, foreign-flagged carriers were prohibited from carrying passengers between American ports without first stopping at a foreign terminal.

Now, fast-forward to the 21st century.

In recent years, American-flagged cruise ship companies began complaining that foreign competitors were making a mockery of the 19th-century law by running ocean liners between California and Hawaii that stopped only for an hour in Mexico — which authorities considered an "evasion" of the requirement for a foreign port visit. Norwegian Cruise Line is one of the few big cruise companies that has U.S.-flagged ships; they sail among the Hawaiian Islands without any foreign port calls; it has supported the change in regulations.

The U.S. Maritime Administration, which promotes the American-flagged ship industry, asked U.S. Customs and Border Protection to craft rules to prevent such maneuvers.

"They were stopping at 2 a.m. at Encinada and leaving at 3 a.m.," said U.S. Maritime Administrator Sean Connaughton. "It was right on their Web site. It said it was only a service call and no passengers could get off the ship there."

But because the current regulations do not stipulate how long a ship must stop at a foreign port, the only way to prevent the practice was to draw up more specific rules, Connaughton said.

The agency came up with a proposal that included three new requirements on foreign carriers, including:

• The stop at a foreign port last at least 48 hours.

• The total time spent at foreign ports be at least half the total time spent at U.S. ports on the cruise.

• Passengers must be allowed to go ashore during the stop at the foreign port.

Last year, customs officials asked for public comments on the proposal. They were deluged with more than 1,000 submissions. Those included letters from the ports group, the U.S. Chamber of Commerce and the Cruise Lines International Association — all of which are strongly opposed to the changes.

The new regulations would affect only foreign-flagged cruise ships, but that accounts for the vast majority of them. The Cruise Lines International Association, which says it represents about 97 percent of the cruise industry in this country, says that only five of its members' 175 oceangoing cruise ships sail under the American flag.

Running a U.S.-flagged cruise ship tends not to be as profitable as operating one under a foreign flag, officials said. That's because U.S. ships face a host of hurdles — including taxes, labor issues and safety inspections — that don't apply to foreign-flagged cruise liners, said Glen Vereb, the customs chief overseeing the cruise industry.

Vereb said it may take weeks or months before officials decide whether to adopt the proposals, scrap them or modify them.

"The beautiful thing about a proposal is that it's very possible that it could come down," he said.

Connaughton said the public comments submitted in reaction to the proposed rule change indicate the foreign cruise ships sailing between California and Hawaii are not the only ones making phantom foreign port stops.

"It seems there are other operators doing the same thing," said Connaughton. "We're going to have to take a deeper look at this."

Kristin Jackson of the Seattle Times Travel staff contributed to this report: kjackson@seattletimes.com