On April 9th, President Trump issued the Restoring America’s Maritime Dominance Executive Order (“Maritime EO”), which declares that “[i]t is the policy of the United States to revitalize and rebuild domestic maritime industries and workforce to promote national security and economic prosperity.” The Maritime EO aims to improve the nation’s commercial shipbuilding capacity and bolster the maritime workforce. The four corners of the Maritime EO primarily take two key steps—(1) directing the National Security Adviser to prepare a Maritime Action Plan (“MAP”) to revitalize domestic maritime industries and (2) imposing a series of trade-related measures to bolster domestic shipping. The Fact Sheet accompanying the Maritime EO further notes that President Trump has established a new Office of Maritime and Industrial Capacity at the National Security Council, which presumably will help coordinate implementation of the Maritime EO.
While much remains to be seen on how the Maritime EO will be implemented, it is clear that the Trump administration intends to take a multifaceted approach to supporting the domestic maritime industry. In this regard, the EO tracks and builds upon the SHIPS for America Act of 2024 (“SHIPS Act”), proposed legislation that garnered broad bipartisan support last year after its initial introduction in Congress. The SHIPS Act was co-sponsored by then-Rep. Michael Waltz, who as the current National Security Adviser has principal responsibility for managing the development of the MAP that forms the backbone for the EO and its policy objectives. Especially in light of the legislative momentum in this area, we expect that this initial action and any subsequent executive and legislative actions will be of significant interest to a wide range of U.S. businesses, including ship builders and their suppliers.
I. The Forthcoming Maritime Action Plan
A central part of the Maritime EO is a directive that within 210 days (i.e., by Nov. 5, 2025), the National Security Adviser develop a MAP in coordination with various agencies. The MAP is expected to “provide a strategy with specific actions to restore and create sustained resiliency for the American maritime industry.” The Maritime EO sketches out some of the contours of this forthcoming plan, and establishes interim milestones to support its development. Broadly, the MAP will include three categories of items: (1) assessments and proposals for maritime industry financial incentives and subsidies; (2) acquisition reforms and deregulatory initiatives; and (3) a series of strategic reports and initiatives, including workforce initiatives.
A. Assessments and Proposals for Maritime Industry Incentives
The Maritime EO demonstrates substantial interest in identifying and marshalling federal resources to support domestic shipbuilding. In particular, the MAP will include an assessment of currently available authorities and resources, such as Defense Production Act Title III authorities and the Defense Department’s Office of Strategic Capital loan program, that can be used to invest in and expand the Maritime Industrial Base. The MAP will also include a report that “inventories Federal programs that could be used to sustain and grow the supply of and demand for the United States maritime industry.” In addition to identifying these existing authorities, the Maritime EO directs the development of legislative proposals or initiatives to finance or subsidize the maritime industry, including a proposal for a Maritime Security Trust Fund to serve as “a reliable funding source” for MAP programs and a plan to create maritime prosperity zones, modeled on the opportunity zones established pursuant to section 13823 of the Tax Cuts and Jobs Act of 2017 (Public Law 115-97, 131 Stat. 2054).
The MAP will also detail a proposed Shipbuilding Financial Incentives Program that will have “broad flexibility to incentivize private investment in the construction of commercial components, parts, and vessels; capital improvements to commercial vessel shipyards; capital improvements to commercial vessel repair facilities and drydocks through grants; and Federal Credit Reform Act-compliant loans and loan guarantees.” This proposal may augment or replace existing programs with similar purposes including the Small Shipyard Grant Program and the Federal Ship Financing (Title XI) Program.
Finally, the MAP will include an additional legislative proposal to increase the fleet of commercial vessels trading internationally under the flag of the United States. This proposal is expected to detail incentives and subsidies to increase the participation of United States commercial vessels that are militarily-useful in international trade.
B. Acquisition Reforms and Deregulatory Initiatives
The Maritime EO also directs that the MAP include proposals and findings on potential deregulatory initiatives and acquisition reforms. First, the MAP will include two proposals for improved acquisition strategies processes for United States Government vessels, one of which will be undertaken by DOGE and the other by the Secretaries of Defense, Commerce, Transportation, and Homeland Security, and the Director of the National Science Foundation. Second, the MAP will include a report of findings from the Secretaries of Defense, Transportation, and Homeland Security that details deregulatory initiatives pertaining to the domestic commercial maritime fleet and maritime port access. The Fact Sheet accompanying the Maritime EO expresses a concern that “government procurement processes and over-regulation have hindered private industry’s ability to build vessels on time and on budget.”
C. Other Reports and Initiatives
The Maritime EO contemplates that the MAP will include at least two strategic reports and analyses. First, the MAP will include a “strategy that identifies the vision, goals, and objectives necessary to secure arctic waterways and enable American prosperity in the face of evolving arctic security challenges and associated risks.” Second, the MAP will include a report with recommendations to increase the number of participants and competitors within United States shipbuilding, and to reduce cost overruns and production delays for surface, subsurface, and unmanned programs.
Further, the Maritime EO details workforce and other initiatives that will be included as part of the MAP. First, the MAP will include a report with recommendations to address workforce challenges in the maritime sector through maritime educational institutions and workforce transitions. Second, the MAP will detail actions taken by the Secretary of Transportation to modernize the U.S. Merchant Marine Academy facilities, including by improving facilities planning, and developing a 5-year capital improvement plan. Finally, the MAP will include guidance on the funding, retention, support, and mobilization of a robust inactive reserve fleet.
II. Global Trade Related Provisions
As described above, most of the Maritime EO’s provisions address the development and planned contents of the MAP. However, consistent with the Trump administration’s focus on global trade, the remaining provisions—Sections 5 through 7—target maritime trade policy and enforcement. These directives include: (1) instructions to the United States Trade Representative (“USTR”) regarding an investigation of certain actions by China; (2) directives related to the enforcement of the Harbor Maintenance Fee and other levies on foreign-origin cargo; and (3) instructions on coordinating U.S. maritime trade policy with global partners.
A. Instructions to the United States Trade Representative
The Maritime EO expects that the USTR will continue its Section 301 unfair foreign trade practices investigation of China’s targeting of the maritime, logistics, and shipbuilding sectors and coordinate its investigation and enforcement actions with relevant federal agencies and agency heads, including the Attorney General and Secretary of Homeland Security. The Maritime EO also directs the USTR to consider tariffs on ship-to-shore cranes and other cargo handling equipment based on its investigation findings. Pursuant to statute, USTR must finalize the Section 301 remedies targeting Chinese shipbuilding by April 17, 2025. Covington has previously detailed this investigation in a prior post.
B. Harbor Maintenance Fee Collection and Enforcement
The Maritime EO identifies a concern with foreign-origin cargo carriers that circumvent the Harbor Maintenance Fee (“HMF”) on imported goods through the practice of making port in Canada or Mexico and sending their cargo into the United States through land borders. The Maritime EO directs the Secretary of Homeland Security to “take all necessary steps,” including introduction of new legislation, to: (1) require all foreign-origin cargo arriving by vessel to clear the Customs and Border Protection (“CBP”) entry process at a United States port of entry and (2) assess all applicable fees, including both the HMF and a 10% service fee, on any foreign-origin cargo first arriving by vessel to North America that clears the CBP process at an inland location from Canada or Mexico.
C. Align Trade Policies with “Allies and Partners”
Finally, the Maritime EO seeks to align the Section 301 and HMF policies described above with the policies of the United States’ international partners. Within 90 days of the Maritime EO (i.e., July 8th), the USTR, in consultation with the Secretaries of State and Commerce, must “engage treaty allies, partners, and other like-minded countries around the world with respect to their potential imposition of any actions taken pursuant to” the Maritime EO’s Section 301 and HMF provisions. The USTR must also deliver an engagement plan and progress report to the President.