Merchant Marine Act of 1920 (Jones Act)
The Merchant Marine Act of 1920, whose Section 27 is known as the Jones Act, reserves shipping of goods by water between U.S. points for vessels that are U.S.-built, U.S.-flagged, and owned and crewed by U.S. citizens.
What it requires
Any cargo carried by water between two points covered by the U.S. coastwise laws, such as Los Angeles to Honolulu, Seattle to Anchorage, or Jacksonville to San Juan, must travel on a vessel built in the United States, documented with a coastwise endorsement, and owned and mostly crewed by U.S. citizens. Stopping at a foreign port on the way does not avoid the rule. CBP enforces it: cargo moved in violation can be seized and forfeited, or the shipper fined up to its value.
Why it matters
The Jones Act makes ocean freight to Hawaii, Alaska, and Puerto Rico slower and more expensive than distance alone would suggest, so it shapes how brands serve those markets. Only a few carriers run qualifying ships, and capacity is limited. A brand that restocks a Honolulu warehouse by container from its Los Angeles 3PL pays domestic Jones Act rates on that leg. Importing the same goods straight from Asia to Honolulu on a foreign ship is legal, because that voyage starts abroad. Many sellers with Hawaii or Puerto Rico demand ship there directly from overseas factories, or use air parcel for small orders, rather than transferring stock from the mainland.
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Not legal advice.