x402 US Flag Carrier Shipment Requirements.pdf

September 8, 2021

TO: All Contractors Supporting DOS Overseas Building Operations (OBO) Programs

SUBJECT: U.S. Flag Carrier Air Transportation Requirements and U.S. Flag Commercial

Vessel Shipment Requirements and Documentation on ALL Contracts

The U.S. Department of State (DOS) is providing this reminder to all contractors supporting OBO missions worldwide.

When air or sea transportation and/or shipment is required under DOS projects, all contractors shall closely follow contract clauses 52.247-63, Preference for U.S.-Flag Air Carriers and 52.247- 64, Preference for Privately Owned U.S.-Flag Commercial Vessels. The requirements of these clauses apply to all firms, including subcontractors at any tier, involved in OBO projects that require shipment of materials. Contractors shall include the substance of these clauses in each subcontract supporting a DOS project that may involve international transportation.

Referencing 52.247-63, Preference for U.S.-Flag Air Carriers, and Section 5 of the International Air Transportation Fair Competitive Practices Act of 1974 (49 U.S.C. 40118) (Fly America Act), DOS and all Government contractors and subcontractors shall use U.S.-flag air carriers for U.S.

Government-financed international air transportation of personnel (and their personal effects) or property, to the extent that service by those carriers is available. If U.S. Carriers are not available for international air transportation, contractors shall submit a, “Statement of Unavailability of U.S.-Flag Air Carrier,” with its pay requests involving such transportation.

When a DOS project requires transportation (whether directly or indirectly) of ocean borne cargoes of equipment, materials, or commodities, contractors shall adhere to the U.S. Cargo shipment requirements specified in 52.247-64, Preference for Privately Owned U.S.-Flag Commercial Vessels. 46 CFR 381.5 Fix American-flag tonnage first applies.

The contractor shall submit one legible copy of an onboard rated ocean bill of lading for each shipment to both the Contracting Officer Representative (COR) and the Maritime Administration (MARAD). The documentation must be furnished within 20 working days of the date of loading for shipments originating in the U.S., and 30 working days for shipments originating outside the U.S. All subcontractor bills of lading shall be submitted through the Prime Contractor. Submittals to MARAD can be mailed or emailed to:

Address: U.S. DOT - Maritime Administration Office of Cargo and Commercial Sealift/Civilian Agencies Division MAR 620, Mail Stop 2 1200 New Jersey Ave., SE Washington, DC 20590

*Email*: CARGO.MARAD@DOT.gov *Preferred method of submission

Documentation on all government-impelled ocean cargo moving under FAR 52.247-64 must be reported to MARAD. The reporting requirement applies whether the ocean cargo moves on a U.S.-flag or foreign-flag vessel and is irrespective of origin or destination of cargo (including cargo moving from foreign-to-foreign locations). A copy of the ocean carrier's (master) bill of lading – properly dated and incorporating applicable ocean freight rates and charges – is sufficient to meet the reporting requirements.

Recognizing that the rated MB/L and/or ocean freight invoice may contain ‘BUSINESS SENSITIVE’ information, freight forwarders can submit the documents directly to MARAD on their client’s behalf. This trade information is treated as ‘Business Sensitive’ and is not released.

MARAD interprets Gross Tonnage as Revenue Ton. A Revenue Ton is a billing unit in the shipping industry. One revenue ton equals weight in metric tons or volume in cubic meters, whichever is higher in terms of freight.

For additional information regarding shipments please visit:

Cargo Preference: https://www.maritime.dot.gov/ports/cargo-preference/cargo-preference

U.S.-Flag Vessel Listing: https://www.maritime.dot.gov/ports/cargo-preference/list-us-flag-carriers

If after the contractor conducts their own due diligence by contacting all U.S.-flag carriers and is unable to locate U.S.-flag ocean services, MARAD staff is available to assist. The full text of clauses 52.247-63 and 52.247-64 and all other Federal Acquisition Regulation (FAR) clauses can be found at http://www.acquisition.gov/far. Contractors shall direct their questions regarding these transportation requirements to the designated COR and/or the Contracting Specialist/Officer administering subject contract.

David W. Vivian Contracting Officer