• A Hawaiian distillery has filed a lawsuit claiming the Jones Act is an outdated law that discriminates against the citizens of Hawaii and Alaska. The distillery owner said he’s losing money over it.

• Adopted in the aftermath of World War I, the 1920 law requires all shipping between U.S. ports to use vessels that are built, owned and crewed by U.S. citizens.
• Anyone who wants to ship goods from Hawaii or other outlying U.S. territories to the mainland is required to follow the rules set by the Jones Act.

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A distillery in Hawaii has filed a lawsuit challenging the Jones Act, arguing the 1920 law violates a clause in the Constitution, prohibiting Congress from favoring ports of one state over another. The Jones Act says that all ships transporting goods between U.S. ports must be U.S. built, flagged, owned and crewed, limiting competition in the American shipping market.

The Kōloa Rum Company on the island of Kauai argues that the Jones Act drives up the cost of living for island businesses and residents.

“We pay more for everything we import, from bottles to packaging, just like all families across the state,” Bob Gunter, CEO of Kōloa, said in a statement. “And then we are hit a second time, paying exorbitant costs for exporting our rum to our fellow Americans. This lawsuit is about ending an unfair, outdated law that discriminates against the citizens of Hawaii and Alaska.”

How many ships operate under the Jones Act?

The number of ships that meet the Jones Act’s standards has been declining for decades, with Statista Research Department data showing fewer than 100 are in operation. 

Anyone who wants to ship goods, including rum, from Hawaii, Puerto Rico, or other outlying U.S. territories to the mainland is required to use one of those vessels.

Lawyers for the Pacific Legal Foundation say the port protection clause, a line in Article 1 of the Constitution, was rooted in the founders’ debates over federal and state powers, ensuring equal protection for each state’s seaborne trade commerce was a critical consideration then, according to constitutional scholars.

How are lawmakers getting involved?

Last week, two U.S. representatives from Hawaii and Guam made a renewed push to reform the Jones Act, including introducing a bill that would exempt all noncontiguous U.S. locations from the law.

They say the Jones Act promotes shipping monopolies that artificially inflate the cost of imported goods.

Hawaii imports greater than 90% of its necessities by ocean cargo.