Renewal of the Voluntary Tanker Agreement Program; Revised Form of the Voluntary Agreement, 67119-67126 [2022-24184]

Agencies

• Maritime Administration
• DEPARTMENT OF TRANSPORTATION

[Federal Register Volume 87, Number 214 (Monday, November 7, 2022)]
[Notices]
[Pages 67119-67126]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-24184]



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DEPARTMENT OF TRANSPORTATION

Maritime Administration


Renewal of the Voluntary Tanker Agreement Program; Revised Form 
of the Voluntary Agreement

AGENCY: Maritime Administration, Department of Transportation.

ACTION: Notice of publication of the voluntary tanker agreement.

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SUMMARY: The Maritime Administration (MARAD) announces the renewal of 
the Voluntary Tanker Agreement Program and the publication of its 
revised Voluntary Tanker Agreement (VTA). The revised VTA replaces a 
prior version that was last published in Volume 73 of the Federal 
Register at page 51692 (September 4, 2008). After publishing the 
proposed text in the Federal Register in 2019 and hosting a public 
hearing in August 2020, MARAD has incorporated public input into the 
revised VTA.

FOR FURTHER INFORMATION CONTACT: David Hatcher, Director, Office of 
Sealift Support, U.S. Department of Transportation, Maritime 
Administration, 1200 New Jersey Avenue SE, Room W25-310, Washington, DC 
20590. Telephone (202) 366-0688; Fax (202) 366-5904, or 
[email protected].

SUPPLEMENTARY INFORMATION:

Background

    Section 708 of the Defense Production Act of 1950, as amended (50 
U.S.C. 4558) (DPA section 708), entitled ``Voluntary agreements and 
plans of action for preparedness programs and expansion of production 
capacity and supply,'' authorizes the President, upon a finding that 
conditions exist which may pose a direct threat to the national defense 
or its preparedness programs, ``to consult with representatives of 
industry, business, financing, agriculture, labor and other interests'' 
in order to provide the making of such voluntary agreements. It further 
authorizes the President to delegate that authority to individuals who 
are appointed by and with the advice and consent of the Senate, upon 
the condition that such individuals obtain the prior approval of the 
Attorney General after the Attorney General's consultation with the 
Federal Trade Commission. Section 401 of Executive Order 13603 
delegated this authority of the President to the Secretary of 
Transportation (Secretary), among others. By 49 CFR 1.93(l), the 
Secretary delegated to the Maritime Administrator the authority, in 
consultation and coordination with the Department of Transportation's 
Office of Intelligence, Security and Emergency Response, to develop and 
enter into maritime-related voluntary agreements such as the VTA.
    Through its Tanker Security Fleet authority at 46 U.S.C. 53407, 
MARAD is authorized to establish emergency preparedness programs. 
Section 53407 provides that participants to a Tanker Security Fleet 
operating agreement must enter into an emergency preparedness agreement 
to make commercial transportation resources (including services) 
available, upon request by the Secretary of Defense during a time of 
war or national emergency, or whenever the Secretary of Defense 
determines that it is necessary for national security or contingency 
operation. Accordingly, MARAD is establishing the Voluntary Tanker 
Agreement Program (VTA Program) as an emergency preparedness program 
and the VTA as its corresponding emergency preparedness agreement.
    Through advance arrangements in joint planning, including the 
development of VTAs, VTA Program participants will provide product 
tanker capacity to support a significant portion of surge and 
sustainment requirements in the deployment of U.S. military forces 
during armed conflicts or other national emergencies.
    Regulations governing voluntary agreements appear at 44 CFR part 
332. The revised form of agreement below will replace the VTA that was 
published in Volume 73 of the Federal Register at page 51692 (September 
4, 2008). A draft revised agreement was published in Volume 84 of the 
Federal Register on pages 58824-29 (November 1, 2019). A public hearing 
on the proposed revised agreement was held on August 18, 2020, by 
teleconference (85 FR 45297 (July 27, 2020)). MARAD received comments 
proposing changes and clarifications (detailed below) to the draft 
revised agreement and made changes to the text reflecting the comments 
and harmonizing the text with the Voluntary Intermodal Sealift 
Agreement (VISA), an active emergency preparedness agreement for dry 
cargo contingency sealift capacity also created under 46 U.S.C. 
subtitle V authority and DPA Section 708 authorities and administered 
by MARAD.
    The Department of Justice, in consultation with the Federal Trade 
Commission, has issued a finding that the revised VTA, as published 
below, satisfies the statutory criteria of the DPA section 708 required 
to implement the voluntary agreement (50 U.S.C. 4558(f)(1)(B)). In 
2009, Congress amended the DPA to note that each voluntary agreement 
expires five years after the date it becomes effective. Accordingly, 
the terms of the VTA published herein will remain effective for a 
period of five years from the date of this publication.
    Because the revised agreement below contains changes from the VTA 
published on September 4, 2008, both former and new participants must 
submit a new application. VTA Program applications are available from 
MARAD upon request.

Comments on the Proposed Voluntary Tanker Agreement

    In response to the agency's Federal Register document published on 
November 1, 2019 (84 FR 58824) seeking public comment on the proposed 
VTA, MARAD received six separate comment submissions from, or on behalf 
of, the following individuals or entities: American Waterway Operators; 
Crowley Maritime Corporation; Jonathan Kaskin, Navy League of the 
United States; Maersk Line, Limited; Schuyler Line Navigation Company; 
and Timothy Boemecke, United States Transportation Command. MARAD 
responds below to all substantive comments.
    Four commenters suggested that the VTA include incentives for 
program participants to carry Government cargoes in peacetime, as with 
the VISA and Civil Reserve Air Fleet (CRAF) programs, to ensure the 
viability of the VTA Program fleet. As with VISA and CRAF, a pledge of 
tanker capacity to the Government for national defense transportation 
demonstrates a commitment on the part of the U.S.-Flag carrier to the 
security and welfare of the Nation. Like the VISA and CRAF programs, 
and in accordance with Department of Defense Instruction 4500.57, secs. 
6.3 and 6.4, VTA participants will receive contracting priorities for 
peacetime cargo.
    One commenter suggested that one of the enumerated responsibilities 
of the Tanker Requirements Committee (TRC) in Sec. IV.A. should be to 
identify those National Defense Features that should be installed on 
VTA Program vessels, subject to the availability of funds, to meet the 
agency's statutory mission of supporting a United States merchant 
marine capable of serving as a naval and military auxiliary in time of 
war or national emergency (46 U.S.C. 50101(a)(2)). We agree and have 
reflected this in the updated VTA at Sec. IV.A.5.
    One commenter suggested that the TRC include a designated 
representative from the United States Navy, in addition to other 
enumerated Department of

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Defense (DoD) components, to represent the requirements of those naval 
vessels that would be supplied by tankers enrolled in the VTA Program. 
MARAD notes that the Military Sealift Command (MSC), the Department of 
the Navy's logistics command with responsibility for supplying fuel to 
naval vessels, is already a member of the TRC, and concludes that MSC 
would represent the above interests on the Committee. However, the TRC 
Co-Chairs may also, at their discretion under the TRC's rules at Sec. 
IV.C., designate other representatives from the Navy to sit on TRC to 
represent fleet fueling requirements.
    One commenter suggested that the Preface be amended to state that 
program participants will be afforded the first opportunity to meet DoD 
peacetime and contingency tanker requirements, and that if they are 
unable to meet these requirements, the balance of DoD tanker 
requirements may be fulfilled by non-participant tankers. Such 
language, which is also found in VISA, offers additional incentive for 
tanker carriers to commit capacity under the VTA to receive the express 
contracting priority. This addition also reserves DoD's right to 
charter tankers, after exhausting the capacities committed under the 
agreement, to meet its needs in armed conflicts and emergencies. The 
Preface language has been amended to reflect the suggestion, together 
with the above comment on contracting incentives for program 
participants.
    One commenter suggested that the VTA Program should be limited to 
product tankers operating exclusively in international commerce, rather 
than also including vessels operating in domestic or mixed domestic and 
international trades, to incentivize the expansion of an 
internationally-sailing U.S.-Flag tanker fleet and to ensure that DoD 
would have access to deep- sea tanker capacity with global operations. 
We disagree. First, the purpose of the VTA Program is to provide DoD 
with the greatest possible volume of U.S.-Flag product tanker tonnage 
for use by the armed forces in the event of an armed conflict or 
national emergency. Any limitation on enrolling qualified tonnage 
beyond a vessel's registry and technical characteristics would 
frustrate that purpose and fail to provide DoD with sufficient tanker 
capacity to meet its emergency requirements. As part of its statutory 
mission, MARAD supports and promotes the growth of the internationally-
trading U.S.-Flag tanker fleet. The intent of the VTA Program, with the 
aforementioned peacetime contracting priority, and in conjunction with 
other agency programs, is to incentivize carriers to register more 
deep-sea tankers in the United States. Second, the VTA's terms and the 
responsibilities of the TRC in Sec. IV.A. will ensure that program 
participants would only enroll those vessels whose technical 
characteristics are best suited to satisfying DoD's tanker sealift 
needs, allowing the VTA Program to dynamically support evolving mission 
requirements.
    One commenter suggested that the VTA Program should grant 
additional priority for the carriage of peacetime Government cargoes to 
coastwise-qualified U.S.-Flag tankers (those tankers holding coastwise 
endorsements under 46 U.S.C. 12112 and eligible to carry merchandise 
between points of the United States under 46 U.S.C. 55102) over those 
vessels only holding registry endorsements (as defined in 46 U.S.C. 
12111), to strengthen the coastwise tanker fleet. MARAD disagrees. As 
stated above, the purpose of the VTA Program is to maximize U.S.-Flag 
worldwide tonnage availability, and the agency's mission is to support 
and maintain a United States-based merchant marine capable of 
supporting the Nation's domestic and international trade in peacetime 
and supplying the Nation's forces in armed conflicts, regardless of 
which endorsements the vessel holds. Further, MARAD does not typically 
contract for the transportation of cargoes by sea but is able to 
certify that a given vessel is enrolled under a VTA and thus can be 
granted general contracting priority. Other agencies of the Government 
contracting for ocean transportation of cargo may elect to grant 
additional priority on the basis of which endorsements a vessel holds 
at the time of contracting, but such decisions are beyond the scope of 
this effort to develop a voluntary agreement.
    One commenter suggested that the determination of a prevailing 
market rate for an enrolled vessel's charter hire under Sec. V.B. of 
the VTA, if activated, should be determined by either MSC or MARAD, 
rather than only MSC. We believe such an arrangement would confuse the 
lines of authority under the agreement, which grants MARAD the 
responsibility of securing tonnage commitments from participating 
tanker carriers and United States Transportation Command (USTRANSCOM), 
the DoD joint command overseeing MSC, the power to charter 
participants' enrolled vessels if their VTA is activated. As USTRANSCOM 
holds the chartering authority under the VTA and would likely have 
access to the same market information as MARAD, the responsibility of 
determining a prevailing market rate on which to base charter hire 
rates belongs with USTRANSCOM. If implemented, the suggestion would 
likely lead to duplicative analyses between USTRANSCOM and MARAD. 
Should any participating tanker carrier have concerns about the 
methodology used by USTRANSCOM in any vessel market analysis, it may 
raise those concerns with USTRANSCOM directly or through the TRC.
    One commenter inquired as to whether the agency would require a 
minimum number of tanker carriers to enroll vessels under their VTAs 
for the TRC to convene and carry out its defined responsibilities due 
to the inclusion of participating tanker carriers on the TRC in 
accordance with Sec. VI.C. of the agreement. The agency contemplates 
that the TRC will convene as soon as is practicable and will notify all 
VTA Program participants in advance of its convening.

The Voluntary Tanker Agreement Program

Table of Contents
Abbreviations
Definitions Preface

The Voluntary Tanker Agreement

I. Purpose and Finding
II. Authorities
    A. Maritime Administration
    B. U.S. Transportation Command
III. General
    A. Scope, Activation, and Prioritization
    B. Participation
    C. Effective Date and Duration of Participation
    D. Withdrawal From the Agreement
    E. Rules and Regulations
    F. Responsibilities and Roles
    G. Amendment of the Agreement
    H. Administrative Expenses
    I. Record Keeping
    J. Requisition of Ships of Non-Participants
    K. Temporary Replacement Vessel
IV. Tanker Requirements Committee
    A. Establishment and Scope of Authority
    B. TRC Leadership
    C. TRC Membership and Meetings
    D. Prohibition on Contract Negotiations
    E. TRC Co-Chairs' Responsibility
V. Activation of the Agreement
    A. Determination of Necessity
    B. Tanker Charters
    C. Termination of Charters
    D. Determination of Tanker Capacity Need
VI. Terms and Conditions
    A. Program Participants

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    B. Proportionate Contribution of Capacity
    C. Reports of Controlled Tonnage
    D. Freight Rates Under the Agreement
    E. War Risk Insurance
    F. Antitrust Defense
VII. Application and Agreement

Abbreviations

``CFR''--Code of Federal Regulations
``Commander''--Commander, United States Transportation Command 
``CONOPS''--Concept of Operations
``DLA''--Defense Logistics Agency
``DoD''--United States Department of Defense
    ``DOJ''--United States Department of Justice
``DOT''--United States Department of Transportation
``DPA''--Defense Production Act of 1950, as amended (50 U.S.C. Chapter 
55)
``FAR''--Federal Acquisition Regulations (as codified at Title 48, CFR)
``FTC''--Federal Trade Commission
``JCS''--Joint Chiefs of Staff
``MARAD''--Maritime Administration, DOT
``NCA''--National Command Authorities
``POL''--Petroleum, Oil, and Lubricants
``SecDef''--United States Secretary of Defense
``Secretary''--United States Secretary of Transportation
``TRC''--Tanker Requirements Committee
``TSP''--Tanker Security Program
``U.S.C.''--United States Code
``USTRANSCOM''--United States Transportation Command (including its 
component units Air Mobility Command, Military Sealift Command, 
Military Surface Deployment and Distribution Command, Joint Operational 
Support Airlift Center, and Joint Enabling Capabilities Command)
``VTA''--Voluntary Tanker Agreement

Definitions

    For purposes of this agreement, the following definitions apply:
    Administrator--Maritime Administrator.
    Attorney General--Attorney General of the United States.
    Broker--A person who arranges for transportation of cargo for a 
fee.
    Chair-FTC--Chairperson of the Federal Trade Commission (FTC).
    Charter--Any agreement or commitment by which the possession or 
services of a vessel are secured for a period of time, or for one or 
more voyages, whether or not a demise of the vessel.
    Clean Tankers or Clean Tonnage--Product tankers that are inspected 
and approved by DLA Energy Quality Assurance Representatives (QAR), 
capable of meeting DoD quality standards, and able to carry refined 
petroleum products.
    Commercial--Transportation service provided for profit by privately 
owned (not government owned) vessels to a private or government 
shipper. The type of service may be either common carrier or contract 
carriage.
    Contingency--Includes, but is not limited to a ``contingency 
operation'' as defined at 10 U.S.C. section 101(a)(13), and a JCS-
directed, NCA-approved action undertaken with military forces in 
response to: (i) natural disasters; (ii) terrorists or subversive 
activities; or (iii) required military operations, whether or not there 
is a declaration of war or national emergency.
    Contingency contracts--DoD contracts in which Participants 
implement advance commitments of capacity and services to be provided 
in the event of a Contingency.
    Controlling interest--More than a 50-percent interest by stock 
ownership.
    Foreign-flag vessel--A vessel registered or documented under the 
law of a country other than the United States of America.
    Non-participant--An operator, as defined under this section, that 
is not subject to a VTA.
    Operator--A person that either owns and controls an eligible vessel 
or that charters and operates an eligible vessel through a demise 
charter that transfers virtually all the rights and obligations of the 
vessel owner to the demise charterer, such as that of crewing, 
supplying, maintaining, insuring, and navigating the vessel.
    Program participant--An operator, as defined under this section, 
and signatory party to a current VTA or an operator that voluntarily 
remains subject to the terms of their expired VTA as provided for in 46 
U.S.C. 53407(c), and otherwise as defined within Section VII of this 
document.
    Person--Includes individuals and corporations, partnerships, and 
associations existing under or authorized by the laws of the United 
States or any state, territory, district, or possession thereof, or of 
a foreign country.
    Product Tanker--A double-hulled self-propelled tank vessel, within 
the meaning of 46 U.S.C. sections 2101(32), (48), and (49), that is 
capable of simultaneously carrying two or more separated grades of 
refined petroleum products, including POL.
    U.S.-Flag Vessel--A vessel registered or documented under the laws 
of the United States of America.
    Voluntary Tanker Agreement (VTA)--The MARAD emergency preparedness 
agreement establishing the terms and conditions for VTA Program 
participants.
    Volunteers--Any vessel owner/operator who is an ocean carrier and 
who offers to make capacity, resources, or systems available to support 
contingency requirements.

Preface

    The Maritime Administrator (Administrator), through delegated 
authority at 49 CFR 1.93(a), has established the Voluntary Tanker 
Agreement Program as an emergency preparedness program pursuant to 46 
U.S.C. 53407. In accordance with section 53407, MARAD is requiring all 
contractors for vessels covered by operating agreements to enter into 
emergency preparedness agreements to make commercial transportation 
resources (including services) available, upon request by the Secretary 
of Defense (SecDef) during a time of war or national emergency, or 
whenever the SecDef determines that it is necessary for national 
security or contingency operation.
    Pursuant to the authority contained in Section 708 of the Defense 
Production Act of 1950, as amended (DPA) (50 U.S.C. 4558), the Maritime 
Administrator (Administrator), through delegated authority at 49 CFR 
1.93(l) and after consultation and coordination with the Department of 
Transportation's Office of Intelligence, Security and Emergency 
Response, consultation with the Department of Defense (DoD) and 
representatives of the tanker industry, has developed this Voluntary 
Tanker Agreement (VTA) as the emergency preparedness agreement under 
the VTA Program to provide DoD with the commercial product tanker 
capacity necessary to meet national defense contingency requirements. 
USTRANSCOM procures commercial tanker capacity to meet requirements for 
DoD operations worldwide through arrangements with common carriers and 
by charter. DoD, (through USTRANSCOM), and DOT (through MARAD) 
maintains and operates a fleet of ships owned by, or under charter to, 
the Federal Government to meet the petroleum, oil, and lubricant (POL) 
needs of the military services which cannot be met by existing 
commercial services.
    The VTA Program is designed to provide DoD a coordinated, seamless 
transition from peacetime to wartime for

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the acquisition of commercial tanker capacity to augment DoD's organic 
tanker capacity. The VTA establishes the terms, conditions, and 
procedures under which persons or entities may become VTA Program 
participants and agree voluntarily to make tankers available to DoD. 
The emergency preparedness program is designed to create a close 
working relationship among MARAD, USTRANSCOM (the DoD-designated 
representative for purposes of the VTA), and the program participants 
through which DoD requirements and the needs of the civil economy can 
be met through cooperative action. The VTA affords program participants 
flexibility to respond to defense requirements and adjust their 
commercial operations to minimize disruption whenever possible. The VTA 
further affords program participants defenses to civil and criminal 
actions for violations of antitrust laws when carrying out their 
obligations under the agreement.
    Program participants will be afforded the first opportunity to meet 
DoD peacetime and contingency sealift requirements within applicable 
law and regulations, to the extent that operational requirements are 
met. In the event program participants are unable to fully meet the 
contingency requirements, the shipping capacity made available under 
VTA may be supplemented by ships and capacity from charter tankers not 
subject to a VTA in accordance with applicable law and by ships 
requisitioned in accordance with the emergency vessel acquisition 
authority under 46 U.S.C. 56301.
    The Administrator, by delegation from the Secretary of 
Transportation (Secretary), has established this emergency preparedness 
program pursuant to 46 U.S.C. 53407 with the approval of the Secretary 
of Defense (SecDef). The Administrator, in conjunction with the SecDef, 
must ensure that all contractors with operating agreements enter into a 
VTA as an emergency preparedness agreement.
    The VTA below replaces the VTA that was published in Volume 73 of 
the Federal Register at page 51692 (Sept. 4, 2008) and expired in 2013 
(the ``2008'' VTA''). Previous participants under the 2008 VTA who wish 
to participate in the VTA Program must submit new applications to 
participate in the VTA below, which contains different substantive 
provisions from the 2008 VTA.

The Voluntary Tanker Agreement

I. Purpose and Finding

    The purpose of the VTA Program is to provide a responsive 
transition from peace to contingency operations through procedures 
agreed upon in advance to provide tanker capacity to support DoD 
contingency requirements. The VTA establishes terms for the commitment 
of tanker capacity to satisfy DoD contingency requirements. The VTA 
Program is intended to promote and facilitate DoD's use of existing 
commercial tanker resources in a manner which minimizes disruption to 
commercial operations whenever possible. The VTA will change from 
standby to active status upon activation by appropriate authority as 
described in Section VI.
    The Administrator has determined, in consultation and coordination 
with the Department of Transportation's Office of Intelligence, 
Security and Emergency Response, and pursuant to 50 U.S.C. 4558(c)(1), 
that conditions exist which may pose a direct threat to the national 
defense of the United States or its preparedness programs and has 
certified to the Attorney General that a standby agreement for the 
utilization of tanker capacity is necessary for the national defense. 
The Attorney General, in consultation with the FTC Chair, by notice in 
the Federal Register on October 6, 2022 (87 FR 60706)issued its finding 
that tanker capacity to meet national defense requirements cannot be 
provided by the industry through a voluntary agreement having fewer 
anticompetitive effects or without a voluntary agreement.

II. Authorities

A. Maritime Administration

    DPA Section 708 (50 U.S.C. 4558), 46 U.S.C. 53407, E.O. 13603, E.O. 
12656, 49 CFR 1.93, 49 CFR 1.81(a)(10).

B. U.S. Transportation Command (USTRANSCOM)

    1. 10 U.S.C. 113, 161-69.
    2. DoD Directive 5158.4 designating Commander to provide air, land, 
and sea transportation for the DoD.

III. General

A. Scope, Activation, and Prioritization

    1. The VTA Program provides for the time-phased availability of 
Program Participants' tanker capacities to meet NCA-directed DoD 
Contingency requirements in the most demanding defense-oriented armed 
conflicts and national emergencies, and for less demanding defense- 
oriented situations through pre-negotiated contingency contracts 
between the government and program participants utilizing an emergency 
planning agreement--the VTA. Such arrangements will be jointly planned 
with MARAD, USTRANSCOM, and program participants in peacetime to allow 
effective, and efficient and best valued use of commercial tanker 
capacity, provide DoD assured Contingency access, and minimize 
commercial disruption, whenever possible.
    2. Activation of the VTA will occur in accordance with the terms in 
Section VI.
    3. The following schedule establishes the prioritized order for 
utilization of commercial tanker capacity to meet DoD peacetime and 
contingency requirements:
    a. U.S.-Flag vessel capacity operated by a program participant;
    b. U.S.-Flag vessel capacity operated by a non-participant;
    c. Combination U.S./foreign flag vessel capacity operated by a 
program participant;
    d. Combination U.S./foreign flag vessel capacity operated by a non-
participant;
    e. U.S. owned or operated foreign flag vessel capacity of a non-
participant; and
    f. Foreign-owned or operated foreign flag vessel capacity of a non-
participant.

B. Participation

    1. Operators of tanker vessels greater than 20,000 deadweight tons 
(DWT) may become program participants by submitting an executed copy of 
the form specified in Section VII and subject to subsequent MARAD 
approval.
    2. Operators of Integrated Tug-Barges (ITBs) and Articulated Tug-
Barges (ATBs) greater than 20,000 DWT may become program participants 
by submitting an executed copy of the form specified in Section VII and 
subject to subsequent MARAD approval.
    3. Operators of tankers or ITB and ATB vessels of less than 20,000 
deadweight tons may also submit an application and become program 
participants if such vessels are deemed to meet U.S. national security 
requirements or the needs of MARAD and USTRANSCOM, and MARAD accepts 
the application.
    4. For the purposes of the VTA, program participation includes the 
corporate entity entering this VTA and all United States subsidiaries 
and affiliates of that entity which own or operate ships in the course 
of their regular business and in which that entity has more than fifty 
percent control either by stock ownership or otherwise.

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    5. A list of program participants will be published annually in the 
Federal Register.

C. Effective Date and Duration of Participation

    This VTA is effective upon execution of the application form in 
Section VII by the Participant and the Administrator or their 
authorized designees and will remain in effect until terminated in 
accordance with 44 CFR 332.4 and 50 U.S.C. 4558(h)(9) or expires in 
accordance with 50 U.S.C. 4558(f)(2).

D. Withdrawal From the Agreement

    Program participants may withdraw from this VTA, subject to the 
fulfillment of obligations incurred under the agreement prior to the 
date such withdrawal becomes effective, by giving written notice to the 
Administrator. Withdrawal should be communicated in writing to the 
Administrator, including a specific date, after which the withdrawing 
participant must cease all activities under the VTA. Withdrawal from 
this VTA will not deprive a program participant of an antitrust defense 
otherwise available to it in accordance with DPA Section 708 for the 
fulfillment of obligations incurred prior to withdrawal.

E. Rules and Regulations

    Program participants acknowledge and agree to abide by all 
provisions of DPA Section 708 and regulations related thereto which are 
promulgated by the Secretary, the Attorney General, the FTC, and the 
Federal Emergency Management Agency. Standards and procedures 
pertaining to voluntary agreements have been promulgated in 44 CFR part 
332. The Administrator will inform program participants of new rules 
and regulations as they are issued.

F. Responsibilities and Roles

    1. The SecDef, through USTRANSCOM, will:
    a. Define requirements for contingency tanker capacity to augment 
DoD tanker capacities.
    b. Keep MARAD and program participants apprised of contingency 
tanker capacity required and capacity committed by program 
participants.
    c. Obtain contingency tanker capacity through the implementation of 
specific pre- negotiated DoD contingency contracts with program 
participants.
    d. Notify the Administrator upon activation of the VTA.
    e. Co-chair (with MARAD) the Tanker Requirements Committee (TRC).
    f. Establish procedures, in accordance with applicable law and 
regulation, providing program participants with necessary 
determinations for use of foreign-flag vessels to replace an equivalent 
U.S.-Flag capacity to transport a participant's normal peacetime DoD 
cargo, when the participant's U.S.-Flag assets are removed from regular 
service to meet VTA Contingency requirements.
    g. Provide a reasonable time to permit an orderly return of a 
program participant's vessel(s) to its regular schedule and termination 
of its foreign flag capacity arrangements as determined through 
coordination between DoD and the participants. Review and endorse the 
program participants' requests to MARAD for use of foreign-flag 
replacement capacity for non-DoD government cargo, when U.S.-Flag 
capacity is required to meet Contingency requirements.
    2. The Secretary, through MARAD, will:
    a. Review the volume of product tanker resources committed in DoD 
contracts and notify USTRANSCOM if the level of VTA commitment will 
have serious adverse impact on the commercial tanker industry's ability 
to provide essential services. MARAD's analysis will be based on the 
consideration that all VTA capacity committed will be activated. This 
notification will occur on an as required basis upon the Commander's 
acceptance of VTA commitments from the program participants. USTRANSCOM 
and MARAD will coordinate to ensure that the volume of product tanker 
assets committed under the VTA will not have an adverse, national 
economic impact.
    b. Upon request by the Commander and approval by SecDef to activate 
this VTA, identify product tanker capacity to meet DoD Contingency 
requirements, in support of DoD priorities.
    c. Establish procedures, pursuant to 46 U.S.C. 53407(f), for 
determinations regarding the equivalency and duration of the use of 
foreign-flag vessels to replace U.S.-Flag vessel capacity to transport 
the cargo of a program participant which has entered into an operating 
agreement under 46 U.S.C. 53403 whose U.S.-Flag vessel capacity has 
been removed from regular service to meet VTA contingency requirements. 
Such foreign flag vessels will be eligible to transport cargo that is 
subject to the Military Transportation Act of 1904 (10 U.S.C. 2631), 
government-financed exports under Public Resolution 17 (46 U.S.C. 
55304), and the Cargo Preference Act of 1954 (46 U.S.C. 55305). 
However, the use of such foreign-flag vessels to transport cargo 
subject to 10 U.S.C. 2631 must have the concurrence of USTRANSCOM 
before it becomes effective.
    d. Co-chair (with USTRANSCOM) the Tanker Requirements Committee 
(TRC).
    e. Ensure that all requirements of 44 CFR 332.3 are met, including 
that the Attorney General, or suitable delegate(s) from DOJ, and the 
FTC Chair, or suitable delegate(s) from the FTC, have awareness of 
activities under the VTA, including activation, deactivations, and 
scheduling of meetings of the TRC or any subcommittee established under 
this Agreement.
    f. Seek necessary waivers of the coastwise trading statutes as 
required, in accordance with 46 U.S.C. 501. To the extent feasible, 
program participants with coastwise-qualified vessels or vessel 
capacity (as defined in 46 U.S.C. 12112) will secure arrangements to 
protect their ability to maintain services for their domestic 
commercial customers and to fulfill their commercial peacetime 
commitments with coastwise-qualified U.S.-Flag vessels. In situations 
where the activation of this VTA deprives a program participant of all 
or a portion of its coastwise-qualified vessels or vessel capacity and, 
at the same time, creates a general shortage of coastwise-qualified 
vessel(s) or vessel capacity on the market, the Administrator may 
request that the Secretary of Homeland Security grant a temporary 
waiver of the coastwise trading statutes, in accordance with 46 U.S.C. 
501, to permit a participant to charter or otherwise utilize non-
coastwise-qualified vessel(s) or vessel capacity, with priority 
consideration recommended for U.S.-crewed vessel(s) or vessel capacity. 
The vessel(s) or vessel capacity for which such waivers are requested 
will be approximately equal to the coastwise-qualified vessel(s) or 
vessel capacity chartered or under contract to DoD.
    3. The Attorney General and the FTC Chair, or suitable delegate(s) 
thereof:
    a. Will fulfill all roles assigned to them under Section 708 of the 
DPA, 50 U.S.C. 4558.
    b. May attend TRC meetings and request to be apprised on any 
activities taken in accordance with activities under this Agreement.
    c. May request and review any proposed action undertaken pursuant 
to this Agreement.
    d. If any DOJ or FTC Representative believes any actions proposed 
or taken are not consistent with relevant antitrust protections 
provided by the DPA, he or she will provide warning and guidance to the 
Committee as soon as the potential issue is identified.
    e. If questions arise about the antitrust protections applicable to 
any particular action, the TRC Co-Chairs may request

[[Page 67124]]

the Attorney General or the Attorney General's designee, in 
consultation with the FTC, to provide an opinion on the legality of the 
action under relevant DPA antitrust protections.

G. Amendment of the Agreement

    1. The Attorney General may modify this VTA, in writing, after 
consultation with the FTC Chair, Secretary, through his or her 
representative MARAD, and SecDef, through his or her representative, 
Commander. The Administrator, Commander, and program participants may 
modify this VTA at any time by mutual agreement, but only in writing 
with the approval of the Attorney General and the FTC Chair.
    2. A program participant may propose amendments to the VTA at any 
time.

H. Administrative Expenses

    Administrative and out-of-pocket expenses incurred by a program 
participant will be borne solely by the program participant.

I. Record Keeping

    1. MARAD and the DoD have primary responsibility for maintaining 
records in accordance with 44 CFR part 332.
    2. The Director, Office of Sealift Support, MARAD, will be the 
official custodian of records related to the carrying out of this VTA, 
except records of direct dealings between the DoD and program 
participants.
    3. For direct dealings between the DoD and program participants, 
the designee of the SecDef will be the official custodian of records, 
but the Director, Office of Sealift Support, MARAD will have complete 
access thereto.
    4. In accordance with 44 CFR 332.3(d), each program participant 
must maintain for five years all minutes of meetings, transcripts, 
records, documents, and other data, including any communications with 
other program participants or with any other member of the industry, 
related to the carrying out of this VTA. Each program participant 
agrees to make available to the Administrator, the Commander, the 
Attorney General, and the FTC Chair for inspection and copying at 
reasonable times and upon reasonable notice any item that this section 
requires the program participant to maintain. Any record maintained 
under this section must be available for public inspection and copying, 
unless exempted on the grounds specified in 5 U.S.C. 552(b)(1), (3) or 
(4) or identified as privileged and confidential information in 
accordance with 50 U.S.C. 4555(d), and 44 CFR 332.5.

J. Requisition of Ships of Non-Participants

    The Administrator, upon Presidential authorization, may requisition 
ships of non-participants to supplement capacity made available for 
defense operations under this VTA and to balance the economic burden of 
defense support among companies operating in U.S. trade. Non- 
participant owners of requisitioned tankers may not participate in the 
TRC and will not enjoy the immunities provided by this VTA.

K. Temporary Replacement Vessel

    Notwithstanding 10 U.S.C. 2631, 46 U.S.C. 55304, 55305, 55312, or 
any other statute governing the oceanic shipments of cargo and supplies 
procured for or financed by the United States Government--
    1. A program participant that is also a contractor under the Tanker 
Security Program (TSP) (46 U.S.C. 53401-11) may operate or employ in 
foreign commerce a foreign-flag vessel or foreign-flag vessel capacity 
as a temporary replacement for a United States-documented vessel or 
United States-documented vessel capacity that is activated by the 
SecDef under this VTA.
    2. Such replacement vessel or vessel capacity will be eligible 
during the replacement period to transport preference cargoes subject 
to 10 U.S.C. 2631, and 46 U.S.C. 55304, 55305, or 55312, to the same 
extent as the eligibility of the vessel or vessel capacity replaced.

IV. Tanker Requirements Committee

A. Establishment and Scope of Authority

    There is established a Tanker Requirements Committee (TRC) to 
provide USTRANSCOM, MARAD, and program participants a forum to:
    1. Analyze DoD contingency tanker requirements;
    2. Identify commercial tanker capacity that may be used to meet DoD 
requirements related to contingencies and, as requested by USTRANSCOM, 
exercises and special movements;
    3. Develop and recommend Concepts of Operations (CONOPS) to meet 
DoD-approved contingency requirements and, as requested by USTRANSCOM, 
exercises and special movements;
    4. Advise the Administrator on the tanker capacity that each 
program participant controls which is capable of meeting contingency 
requirements; and
    5. Identify National Defense Features appropriate for installation 
on commercial tankers to enhance their service capabilities for 
operation upon activation under this Agreement.

B. TRC Leadership

    The TRC will be co-chaired by MARAD and USTRANSCOM and will convene 
as jointly determined by the co-chairs.

C. TRC Membership and Meetings

    1. TRC regular membership will consist of designated 
representatives from MARAD, USTRANSCOM, Military Sealift Command, 
Defense Logistics Agency-Energy, each program participant, and maritime 
labor. Other attendees may be invited at the discretion of the co-
chairs. Representatives will provide technical advice and support to 
ensure maximum coordination, efficiency, and effectiveness in the use 
of program participants' resources.
    2. All program participants will be invited to open committee 
meetings. For selected committee meetings, attendance may be limited to 
designated program participants to meet specific operational 
requirements.
    3. The co-chairs may establish working groups within TRC. Program 
participants may be assigned to working groups as necessary to develop 
specific CONOPS. Each working group will be co-chaired by 
representatives designated by MARAD and USTRANSCOM.
    4. In general, program participants will not be asked to share 
competitively sensitive information directly with other program 
participants. Direct sharing of information among program participants 
will be requested only when necessary and will be closely supervised by 
the TRC Co-Chairs, including requiring appropriate safeguards regarding 
program participant use and dissemination of other program 
participants' data.

D. Prohibition on Contract Negotiations

    TRC participation will not be used for contract negotiations and/or 
contract discussions between carriers and DoD; such negotiations and/or 
discussions will be in accordance with applicable DoD contracting 
policies and procedures.

E. TRC Co-Chairs' Responsibilities

    TRC co-chairs will:
    1. Notify the Attorney General, the FTC Chair, and the program 
participants of the time, place, and nature of each meeting and of the 
proposed agenda of each meeting to be held to carry out this VTA;
    2. Provide for publication in the Federal Register of a notice of 
the time, place, and nature of each meeting. If a

[[Page 67125]]

meeting is open, a Federal Register notice will be published reasonably 
in advance of the meeting. If a meeting is closed, a Federal Register 
notice will be published within ten days of the meeting and will 
include the reasons why the meeting is closed;
    3. Establish the agenda for each meeting and be responsible for 
adherence to the agenda;
    4. Provide for a written summary or other record of each meeting 
and provide copies of transcripts or other records to the Attorney 
General, the FTC Chair, and all program participants; and
    5. Take necessary actions to protect from public disclosure any 
data discussed with or obtained from program participants which a 
participant has identified as privileged and confidential in accordance 
with DPA Sections 708(h)(3) and 705(e) (50 U.S.C. 4558(h)(3) and 
4555(d)), or which qualifies for withholding under 44 CFR 332.5.

V. Activation of the VTA

A. Determination of Necessity

    This VTA may be activated in whole or in part at the request of the 
Commander, with the approval of SecDef, to support contingency 
operations when there is a tanker capacity emergency. A tanker capacity 
emergency will be deemed to exist when the Commander finds that tanker 
capacity required to support operations of U.S. forces outside the 
continental United States cannot be supplied through the commercial 
tanker charter market in accordance with applicable laws and 
regulations or other voluntary arrangements. The Commander will 
immediately notify the Administrator when such a finding has been made 
and upon activation of this VTA. The Administrator will then notify the 
Attorney General and the FTC Chair when such a finding is made.

B. Tanker Charters

    USTRANSCOM will work directly with tanker operators in the making 
of charter parties and other arrangements to meet the defense 
requirement, keeping the Administrator informed. To reduce risk to 
owners and to control cost to the government, all government charters 
will be time charters, unless specifically designated as voyage 
charters by the contracting officer. If vessels are chartered between 
program participants, participants will keep the Administrator 
informed.
    The Administrator will keep the Attorney General and the FTC Chair 
informed of the actions taken under this VTA.

C. Termination of Charters

    USTRANSCOM, as the contracting officer, will notify the 
Administrator as far as possible in advance of the prospective 
termination of the need for tanker capacity under this VTA.

D. Determination of Tanker Capacity Need

    Upon activation of this VTA, USTRANSCOM will consult with the TRC 
to determine which enrolled tankers best meet the requirements of the 
declared tanker capacity emergency, based on the tankers' 
characteristics. This may result in activation of only a portion of the 
committed tanker fleet.

VI. Terms and Conditions

A. Program Participants

    1. Each program participant agrees to contribute tanker capacity as 
requested by the Administrator in accordance with Section VI. B. below 
at such times and in such amounts as the Administrator, as requested by 
DoD, will determine to be necessary to meet the essential needs of the 
DoD for the transportation of DoD petroleum and petroleum products in 
bulk by sea.
    2. Each program participant further agrees to make tankers and 
tanker capacity available to other program participants when requested 
by the Administrator, on the advice of TRC, in order to ensure that 
contributions to meet DoD requirements are made on a proportionate 
basis whenever possible or to ensure that no participating tanker 
operator is disproportionately hampered in meeting the needs of the 
civil economy.

B. Proportionate Contribution of Capacity

    1. Any entity receiving payments under TSP must become a program 
participant with respect to all tankers enrolled in TSP at all times 
until the date the TSP operating agreement would have terminated 
according to 46 U.S.C. 53404(a). Such participation will satisfy the 
requirement for a TSP participant to be enrolled in an emergency 
preparedness program approved by SecDef as provided in 46 U.S.C. 53407.
    2. Program participants hereto not receiving TSP payments under 
TSP, agree to contribute tanker capacity under this VTA in the 
proportion that its controlled tonnage bears to the total controlled 
tonnage of all program participants. Because exact proportions may not 
be feasible, each program participant agrees that variances are 
permissible at the discretion of the Administrator.
    3. Controlled tonnage will include tankers, ITBs, and ATBs of over 
20,000 DWT capacity, which are:
    a. Militarily useful in the transportation of refined DoD cargoes 
pursuant to the requirements of associated war plans;
    b. Vessels in which, as of the effective date of the activation of 
this VTA, the program participant or any of its U.S. subsidiaries or 
affiliates has a controlling interest and which are registered in the 
United States or any non-U.S. registry approved by TRC, and will 
include:
    i. Vessels on charter or under contract to such program participant 
for a period of six months or more from the effective date of 
activation of this VTA, regardless of flag of registry, exclusive of 
tonnage available to the program participant under contracts of 
affreightment and consecutive voyage charter; provided that, in the 
event an owner of a vessel terminates a time charter in accordance with 
a war clause, the affected tonnage will be excluded from the chartering 
participant's controlled tonnage; and
    ii. Any other non-U.S.-Flag tonnage which a program participant may 
offer to designate as controlled tonnage and which TRC accepts;
    c. And may not include:
    i. Tankers described in subparagraph b. which are chartered out or 
under contract to others for a remaining period of six months or more 
from the effective date of activation of this VTA; or
    ii. Certain vessels which are fitted with special gear and are on 
permanent station for the storage of crude oil from a production 
platform and vessels which may have a dual role of production storage 
and transportation use to a limited location.
    4. Chemical tankers and tankers in dirty trade may contribute Clean 
Tanker capacity only after being certified as being able to meet DoD 
quality standards to carry refined petroleum products to meet DoD 
requirements.
    5. This VTA will not be deemed to commit any vessel with respect to 
which the law of the country of registration requires the approval of 
the government before entering into this VTA or furnishing such vessel 
under the terms of this VTA until such time as the required approval 
has been obtained.
    6. The obligations of program participants to contribute clean 
tanker capacity under this VTA will be calculated on a proportionate 
basis wherever possible among the program participants by TRC.
    7. A vessel on charter to a program participant will not be subject 
to a relet to the DoD in the case where the period

[[Page 67126]]

of the relet would be longer than the term of the program participant's 
charter or in the case where the relet would otherwise breach the terms 
of the charter, but such tonnage will be included in the calculation of 
the program participant's controlled tonnage.
    8. The Administrator retains the right under law to requisition 
ships of program participants. A program participant's ships which are 
directly requisitioned by the U.S. Government or which are called up 
pursuant to other U.S. Government voluntary arrangements will be 
credited against the participant's proportionate contribution under 
this VTA. Ships on charter to the DoD when this VTA is activated will 
not be so credited.

C. Reports of Controlled Tonnage

    Twice annually, or upon request of the Administrator and in such 
form as may be requested, each program participant must submit 
information as to controlled tonnage necessary for the carrying out of 
this VTA. Information which a program participant identifies as 
privileged and confidential will be withheld from public disclosure in 
accordance with DPA Sections 708(h)(3) and 705(e) (50 U.S.C. 4558(h)(3) 
and 4555(d)), and 44 CFR 332.5.

D. Freight Rates Under the VTA

    1. The rate of charter hire applicable to each charter under this 
VTA will be the prevailing market rate effective at the time of the 
proposed loading of the vessel. The USTRANSCOM Contracting Officer will 
determine the prevailing market rate utilizing the price analysis 
techniques set forth in FAR Subpart 15.4 to determine that the 
negotiated rates are fair and reasonable, utilizing market or previous 
contract prices. Time charter hire rates, for either U.S. or foreign-
flag tankers, will be expressed in terms of a per diem rate(s).
    2. The rate of charter hire fixed with respect to each charter will 
apply for the entire period of the charter, except that:
    a. For a consecutive voyage charter, the rate of charter will be 
increased or decreased to reflect increases or decreases in the price 
of bunker fuel applicable in the area of the vessel's trade; and
    b. Reimbursement for increased war risk insurance premiums will be 
made in accordance with Section VI.E.

E. War Risk Insurance

    1. Increased war risk insurance premiums for time-chartered vessels 
will be paid by DoD, or MARAD war risk insurance policies will be 
implemented.
    2. For voyage and consecutive voyage charters, the program 
participant will be reimbursed for increases in war risk insurance 
premiums that are applicable to the actual voyage but are announced 
after the charter rate is established by the broker panel.
    3. For any ship chartered under this VTA, the SecDef may procure 
from the Secretary war risk insurance on hull and machinery, war risk 
protection and indemnity insurance, and Second Seaman's War Risk 
Insurance, subject to 46 U.S.C. 53905.

F. Antitrust Defense

    Under the provisions of DPA Subsection 708(j) (50 U.S.C. 4558(j)), 
each program participant in the VTA will have available as a defense to 
any civil or criminal action brought for violation of the antitrust 
laws with respect to any act or omission to act to develop or carry out 
the VTA, that such act or omission to act was taken by the program 
participant in the course of developing or carrying out this VTA, that 
the program participant fully complied with the provisions of the DPA 
and the rules promulgated thereunder, and that the program participant 
acted in accordance with the terms of this VTA. This defense will not 
be available to the program participant for any act or omission 
occurring after the termination of the VTA, nor will it be available, 
upon the modification of the VTA, with respect to any subsequent act or 
omission that is beyond the scope of the modified VTA, except that no 
such termination or modification will be accomplished in a way that 
will deprive program participants of this antitrust defense for the 
fulfillment of obligations incurred. This defense will be available 
only if and to the extent that the program participants asserting it 
demonstrate that the action, which includes a discussion or agreement, 
was within the scope of this VTA, and taken at the direction of the 
USTRANSCOM and/or MARAD, and with appropriate oversight and approval of 
USTRANSCOM and/or MARAD. The person asserting the defense bears the 
burden of proof. The defense will not be available if the person 
against whom it is asserted shows that the action was taken for the 
purpose of violating the antitrust laws of the United States.

VII. Application and Agreement

    The Administrator has adopted and makes available a form on which 
tanker operators may apply for and become program participants in this 
VTA (``Application and Agreement to Participate in the Voluntary Tanker 
Agreement''). The form will incorporate by reference the terms of this 
VTA.

Application and Agreement To Participate in the Voluntary Tanker 
Agreement

    The applicant identified below hereby applies to participate in the 
Maritime Administration's agreement entitled ``Voluntary Tanker 
Agreement'' (VTA). The text of this VTA was published in__Federal 
Register__,__, 2022 (citation placeholder).
    This VTA is authorized pursuant to 46 U.S.C. 53407 and under 
Section 708 of the Defense Production Act of 1950, as amended (50 
U.S.C. 4558). Regulations governing this VTA appear at 44 CFR part 332.
    The applicant, if approved, hereby acknowledges and agrees to the 
incorporation by reference into this application and agreement of the 
entire text of the Voluntary Tanker Agreement published in__Federal 
Register_,_, 2022 (citation placeholder), as though said text were 
physically recited herein.
    The applicant, as program participant, agrees to comply with the 
provisions of Section 708 of the Defense Production Act of 1950, as 
amended (50 U.S.C. 4558), the regulations of 44 CFR part 332 and 46 
U.S.C. 53407, and the terms of the Voluntary Tanker Agreement.
    Further, the applicant, if approved as a program participant, 
hereby agrees to contractually commit to make vessels or capacity 
available for use by the Department of Defense and to other program 
participants for the purpose of meeting national defense requirements.

-----------------------------------------------------------------------
(Corporate Secretary)
-----------------------------------------------------------------------
(Applicant-Corporate Name)
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(Name of authorized official)
(CORPORATE SEAL or Notary)
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(Position Title)
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(Signature of authorized official)
UNITED STATES OF AMERICA
DEPARTMENT OF TRANSPORTATION
MARITIME ADMINISTRATION
Effective Date:--------------------------------------------------------
By order of the Maritime Administrator.
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Secretary, Maritime Administration.

(Authority: 50 U.S.C. 4558, 46 U.S.C. 53407, E.O. 13603, E.O. 12656, 
49 CFR 1.93, 49 CFR 1.81(a)(10), 44 CFR part 332)

    By order of the Maritime Administrator.
T. Mitchell Hudson, Jr.,
Secretary, Maritime Administration.
[FR Doc. 2022-24184 Filed 11-4-22; 8:45 am]
BILLING CODE 4910-81-P