Voluntary Intermodal Sealift Agreement (VISA), 26171-26173 [E6-6680]

Agencies

• Maritime Administration
• DEPARTMENT OF TRANSPORTATION

[Federal Register Volume 71, Number 85 (Wednesday, May 3, 2006)]
[Notices]
[Pages 26171-26173]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-6680]


-----------------------------------------------------------------------

DEPARTMENT OF TRANSPORTATION

Maritime Administration


Voluntary Intermodal Sealift Agreement (VISA)

AGENCY: Maritime Administration, DOT.

ACTION: Notice of open season for enrollment in the VISA program.

-----------------------------------------------------------------------

Introduction

    The VISA program was established pursuant to section 708 of the 
Defense Production Act of 1950, as amended (DPA), which provides for 
voluntary agreements for emergency preparedness programs. VISA was 
approved for a two year term on January 30, 1997, and published in the 
Federal Register on February 13, 1997, (62 FR 6837). Approval is 
currently extended through September 30, 2007, as published in the 
Federal Register on September 23, 2005 (70 FR 55947).
    As implemented, the VISA program is open to U.S.-flag vessel 
operators of oceangoing militarily useful vessels. Operators include 
vessel owners and bareboat charter operators if satisfactory signed 
agreements are in place committing the assets of the owner to the 
bareboat charterer for purposes of VISA. While tug/barge operators must 
own or bareboat charter barges committed to the VISA program, it is not 
required that these operators commit tug service through bareboat 
charter or ownership arrangements. Time charters of U.S.-flag tugs will 
satisfy tug commitments to the VISA program. However, participation in 
the VISA program is not satisfied by tug commitment only. Tug/barge 
VISA participants must commit capacity of at least one barge to the 
VISA program. Voyage and space charterers are not considered U.S.-flag 
vessel operators for purposes of VISA eligibility.

VISA Concept

    The mission of VISA is to provide commercial sealift and intermodal 
shipping services and systems, including vessels, vessel space, 
intermodal systems and equipment, terminal facilities, and related 
management services, to the Department of Defense (DOD), as necessary, 
to meet national defense contingency requirements or national 
emergencies.
    VISA provides for the staged, time-phased availability of 
participants' shipping services/systems to meet contingency 
requirements through prenegotiated contracts between the Government and 
participants. Such arrangements are jointly planned with the Maritime 
Administration (MARAD), U.S. Transportation Command (USTRANSCOM), and 
participants in peacetime to allow effective and best valued use of 
commercial sealift capacity, to provide DOD assured contingency access, 
and to minimize commercial disruption, whenever possible.
    There are three time-phased stages in the event of VISA activation. 
VISA Stages I and II provide for prenegotiated contracts between DOD 
and participants to provide sealift capacity to meet all projected DOD 
contingency requirements. These contracts are executed in accordance 
with approved DOD contracting methodologies. VISA Stage III will 
provide for additional capacity to the DOD when Stage I and II 
commitments or volunteered capacity

[[Page 26172]]

are insufficient to meet contingency requirements, and adequate 
shipping services from non-participants are not available through 
established DOD contracting practices or U.S. Government treaty 
agreements.

VISA Enrollment Open Season

    The purpose of this notice is to invite interested, qualified U.S.-
flag vessel operators that are not currently enrolled in the VISA 
program to participate in the program. Approved participants' VISA 
contingency contracts will coincide with the DOD contracting cycle of 
October 1, 2006 through September 30, 2007. This is the ninth annual 
enrollment period since the commencement of the VISA program. The 
annual enrollment was initiated because VISA has been fully integrated 
into DOD's priority for award of cargo to VISA participants. It is 
necessary to link the VISA enrollment cycle with DOD's peacetime cargo 
contracting cycle.
    New VISA applicants are required to submit their applications for 
the VISA program as described in this Notice no later than May 31, 
2006. Applicants must provide copies of loadline documents from a 
recognized classification society to validate oceangoing vessel 
capability, and U.S. Coast Guard Certificates of Documentation for all 
vessels in their fleet. If vessels are bareboat chartered or time 
chartered (applicable to tugs only) by the applicant, charter 
agreements should be provided along with the application. Bareboat 
charter and time charter agreements must, at a minimum, be valid from 
the time of application through September 30, 2007. Bareboat charter 
agreements must also state that the owner will not interfere with the 
charterer's obligation to commit chartered vessel(s) to VISA program 
for the duration of the charter. Approved VISA participants will be 
responsible for assuring that information submitted with their 
application remains up to date beyond the approval process. Any changes 
to VISA commitments must be reported to MARAD and USTRANSCOM not later 
than seven days after the change. If charter agreements are due to 
expire, participants must provide MARAD with charters that extend the 
charter duration for another 12 months or longer.
    Alignment of VISA enrollment and eligibility for VISA priority will 
solidify the linkage between commitment of contingency assets by VISA 
participants and receiving VISA priority consideration for the award of 
DOD peacetime cargo. This is the only planned enrollment period for 
carriers to join the VISA program and derive benefits for DOD peacetime 
contracts during the time frame of October 1, 2006 through September 
30, 2007. The only exception to this open season period for VISA 
enrollment will be for a non-VISA carrier that reflags a vessel into 
U.S. registry. That carrier may submit an application to participate in 
the VISA program at any time upon completion of reflagging.

Advantages of Peacetime Participation

    Because enrollment of carriers in the VISA program provides DOD 
with assured access to sealift services during contingencies based on a 
level of commitment, as well as a mechanism for joint planning, DOD 
awards peacetime cargo contracts to VISA participants on a priority 
basis. This applies to liner trades and charter contracts alike. Award 
of DOD cargoes to meet DOD peacetime and contingency requirements is 
made on the basis of the following priorities:
     U.S.-flag vessel capacity operated by VISA participants, 
and U.S.-flag Vessel Sharing Agreement (VSA) capacity held by VISA 
participants.
     U.S.-flag vessel capacity operated by non-participants.
     Combination U.S.-flag/foreign-flag vessel capacity 
operated by VISA participants, and combination U.S.-flag/foreign-flag 
VSA capacity held by VISA participants.
     Combination U.S.-flag/foreign-flag vessel capacity 
operated by non-participants.
     U.S.-owned or operated foreign-flag vessel capacity and 
VSA capacity held by VISA participants.
     U.S.-owned or operated foreign-flag vessel capacity and 
VSA capacity held by non-participants.
     Foreign-owned or operated foreign-flag vessel capacity of 
non-participants.

Participants

    Any U.S.-flag vessel operator organized under the laws of a state 
of the United States, or the District of Columbia, who is able and 
willing to commit militarily useful sealift assets and assume the 
related consequential risks of commercial disruption, may be eligible 
to participate in the VISA program. The term ``operator'' is defined in 
the VISA document as ``an ocean common carrier or contract carrier that 
owns, controls or manages vessels by which ocean transportation is 
provided''. Applicants wishing to become participants must provide 
satisfactory evidence that the vessels being committed to the VISA 
program are operational and that vessels are intended to be operated by 
the applicant in the carriage of commercial or government preference 
cargoes. While vessel brokers, freight forwarders and agents play an 
important role as a conduit to locate and secure appropriate vessels 
for the carriage of DOD cargo, they may not become participants in the 
VISA program due to lack of requisite vessel ownership or operation. 
However, brokers, freight forwarders and agents should encourage the 
carriers they represent to join the program.

Commitment

    Any U.S.-flag vessel operator desiring to receive priority 
consideration in the award of DOD peacetime contracts must commit no 
less than 50 percent of its total U.S.-flag militarily useful capacity 
in Stage III of the VISA program. Participants operating vessels in 
international trade and desiring to bid on DOD peacetime contracts will 
be required to provide commitment levels to meet DOD-established Stages 
I and/or II minimum percentages of the participant's militarily useful, 
oceangoing U.S-flag international trading fleet capacity on an annual 
basis. USTRANSCOM and MARAD will coordinate to ensure that the amount 
of sealift assets committed to Stages I and II will not have an adverse 
national economic impact. To minimize domestic commercial disruption, 
participants operating vessels exclusively in the domestic Jones Act 
trades are not required to commit the capacity of those U.S. domestic 
trading vessels to VISA Stages I and II. Overall VISA commitment 
requirements are based on annual enrollment.
    In order to protect a U.S.-flag vessel operator's market share 
during contingency activation, VISA allows participants to join with 
other vessel operators in Carrier Coordination Agreements (CCAs) to 
satisfy commercial or DOD requirements. VISA provides a defense against 
antitrust laws in accordance with the DPA. CCAs must be submitted to 
MARAD for coordination with the Department of Justice for approval, 
before they can be utilized.

Compensation

    In addition to receiving priority in the award of DOD peacetime 
cargo, a participant will receive compensation during contingency 
activation. During enrollment, each participant may choose a 
compensation methodology which is commensurate with risk and service 
provided. The compensation methodology selection will be completed with 
the appropriate DOD agency.

[[Page 26173]]

Enrollment

    New applicants may enroll by obtaining a VISA application package 
(Form MA-1020 (OMB Approval No. 2133-0532)) from the Director, Office 
of Sealift Support, at the address indicated below. Form MA-1020 
includes instructions for completing and submitting the application, 
blank VISA Application forms and a request for information regarding 
the operations and U.S. citizenship of the applicant company. A copy of 
the VISA document as published in the Federal Register on September 23, 
2005 will also be provided with the package. This information is needed 
in order to assist MARAD in making a determination of the applicant's 
eligibility. An applicant company must provide an affidavit that 
demonstrates that the company is qualified to document a vessel under 
46 U.S.C. 12102, and that it owns, or bareboat charters and controls, 
oceangoing, militarily useful vessel(s) for purposes of committing 
assets to the VISA program. As previously mentioned, VISA applicants 
must return the completed VISA application documents to MARAD not later 
than May 31, 2006. Once MARAD has reviewed the application and 
determined VISA eligibility, MARAD will sign the VISA application 
document which completes the eligibility phase of the VISA enrollment 
process.
    After VISA eligibility is approved by MARAD and USTRANSCOM, 
approved applicants are required to execute a joint VISA Enrollment 
Contract (VEC) with the DOD [Military Surface Deployment and 
Distribution Command (SDDC) and the Military Sealift Command (MSC)] 
which will specify the participant's Stage III commitment for the 
period October 1, 2006 through September 30, 2007. Once the VEC is 
completed, the applicant completes the DOD contracting process by 
executing a Drytime Contingency Contract (DCC) with MSC (for Charter 
Operators) and if applicable, a VISA Contingency Contract (VCC) with 
SDDC (for Liner Operators). MARAD reserves the right to revalidate all 
eligibility requirements without notice.
    For Additional Information and Applications Contact: Taylor E. 
Jones II, Director, Office of Sealift Support, U.S. Maritime 
Administration, Room 7307, 400 Seventh Street, SW., Washington, DC 
20590. Telephone (202) 366-2323. Fax (202) 366-3128. Other information 
about the VISA can be found on MARAD's Internet Web Page at https://
www.marad.dot.gov.

    (Authority: 49 CFR 1.66)

    Dated: April 28, 2006.

    By Order of the Acting Maritime Administrator.
Joel C. Richard,
Secretary, Maritime Administration.
[FR Doc. E6-6680 Filed 5-2-06; 8:45 am]
BILLING CODE 4910-81-P