Monday, February 11, 2008

Federal Rule Changes For Cruise Ships Getting More Interesting Yet

As it stands now, if the rules as interpreted are to go in affect, any foreign flagged cruise ship that sails between 2 different U.S. ports would have to spend at leas 48 hours in a foreign port and at least 50% of its time in a foreign port. The best example would be a Hawaii cruise leaving from San Diego. The 14 day cruise which spend 8 hours at each of up to 7 ports around Hawaii not to mention the time in San Diego would have to add a port such as Ensenada for 48 or more hours to justify the trip. Right now there are only 3 ships that would not have to do this. The Pride of Aloha, Pride of Hawaii and the Pride of America. All three Norwegian ships. Many believe that favoritism is the reason for the new rules. But under the interpretations, all of Norwegians other ships which are foreign flagged would have to follow the rules that the other cruise lines would as well. Adding to the turmoil is that the Pride of Hawaii has been removed from service to Hawaii, and the Pride of Aloha is going to be relocated to the growing Asian market leaving only one ship that will benefit from the new rules.

The reason cruise operators keep their ships under foreign flags is simple. It keeps costs down. By being under a foreign flag, they do not have to adhere to many U.S. tax and wage laws. The U.S. flagged ships have higher wages and thus pass on the costs to the passengers. What is getting confusing in all this is how it will affect many other U.S. ports besides Hawaii. On the West Coast, Alaska and California will see the brunt of the change but there will be a few ports on the East Coast as well. A recent news report stated that Northfolk Virginia could see a percentage of visiting ships leave because of the rule. Passengers want to visit foreign cities and U.S. cities. but doing both on the same cruise is going to become much more difficult and more expensive if the proposed rules come into play.

I have written a handful of posts on this subject in the last few months. It seems like every week there is a new tidbit of info pops up. If you have heard anything that I have not mentioned here, please leave a comment and I will research it.

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