,,ib ,union ,calendar ,no4 #bfi #aahth ,,congress #ast ,session ,h4 ,r4 #fcfe ,report ,no4 #aah-ccj ,,in ,,the ,,house ,,of ,,representatives ,november #ac1 #bjbc,ms4 ,waters introduced the following bill2 which was referred to the ,committee on ,financial ,services ,december #ai1 #bjbc,reported with an amendment1 committed to the ,committee of the ,whole ,house on the ,state of the ,union1 and ordered to be printed,strike out all after the enacting clause and insert the part printed in italic,for text of introduced bill1 see copy of bill as introduced on ,november #ac1 #bjbc ,a ,,bill ,to protect against illicit oil shipments1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,stopping ,illicit ,oil ,shipments ,act of #bjbc4 #b4 ,findings ,the ,congress finds the following3 7#a7 ,when countries are designated under economic and trade sanctions by the ,united ,states and its allies1 they are largely excluded from the licit global financial system1 including the movement1 sale1 and profit derived from their oil and gas resources4 7#b7 ,for ,u4,s4 persons1 ,american maritime sanctions1 including on nations like ,iran1 ,russia1 and ,north ,korea1 restrict the financing of vessels and cargo1 insurance and re-insurance1 companies using vessels to transport their goods1 shipowners1 charterers1 and those providing maritime services such as classification and certification4 7#c7 ,one method by which ,iran and ,russia frequently attempt to evade these ,u4,s4 sanctions on oil is to false flag1 which means to avoid sanctions scrutiny by registering a vessel in a permissive country or by sailing under another country's flag without communicating this to the country whose flag is being used4 7#d7 ,according to ,foreign ,policy1 approximately two million barrels of oil from sanctioned countries1 including ,iran and ,russia1 are transported under false flags every day4 7#e7 ,in order to evade a sanctions regime1 vessels transporting oil and gas resources from sanctioned countries must carry insurance policies to allow them to dock at a port1 unload their goods1 or use a port's services1 such as refueling4 7#f7 ,the veracity of a vessel's flag is subject to examination by port authorities1 but verification by the port and service providers does not always occur4 7#g7 ,given the lack of comprehensive checks on the veracity of flags1 this ,act will force a change in behavior within the maritime shipping industry by limiting the availability of insurance products to those not verifying flag registration and providing a direct route for the ,office of ,foreign ,assets ,control 7,,ofac7 to gain possibly actionable information that could lead to ,,ofac enforcement actions as well as additional targets for sanctions designations4 #c4 ,material misrepresentation 7a7 ,in general ,in maritime insurance contracts1 failure to verify a vessel's registration shall be deemed a material misrepresentation by the policyholder4 7b7 ,rulemaking ,the ,undersecretary for ,terrorism and ,financial ,crimes shall issue rules to carry out this section4 #d4 ,identification of vessels with illicit maritime insurance 7a7 ,in general ,the primary insurance regulatory authority of a ,state may report to the ,undersecretary for ,terrorism and ,financial ,crimes when1 in the sole discretion of the primary insurance regulatory authority1 the primary insurance regulatory authority has determined that the conditions exist for a maritime insurance contract to be voidable pursuant to section #c4 7b7 ,limitations ,with respect to a maritime insurance contract1 a report may only be made under subsection 7a7 if the primary insurance regulatory authority-- 7#a7 establishes that the maritime insurance contract has been issued by an insurer subject to the authority of the primary insurance regulatory authority2 7#b7 establishes that the maritime insurance contract satisfies the conditions established by the ,undersecretary for ,terrorism and ,financial ,crimes to be voidable pursuant to section #c2 and 7#c7 possesses1 to the satisfaction of the primary insurance regulatory authority1 clear and compelling credible factual evidence that a policyholder has failed to verify the registration of a vessel4 #e4 ,report 7a7 ,in general ,not later than the end of the #ahj-;day period beginning on the date of the enactment of this ,act1 and annually thereafter for #e years1 the ,secretary of the ,treasury shall issue a report to the appropriate committees of the ,congress-- 7#a7 detailing any reports received by the ,undersecretary for ,terrorism and ,financial ,crimes from a primary insurance regulatory authority under section #d2 7#b7 detailing any steps taken by the ,secretary of the ,treasury on the receipt of that information2 7#c7 describing of activities taken by the ,secretary of the ,treasury1 including meetings and advisories1 to engage with the maritime community1 foreign governments1 and civil society to improve outreach and understanding of the compliance expectations related to maritime sanctions evasion2 and 7#d7 describing any proposed improvements to existing authorities or resources that could be provided by ,congress4 7b7 ,exception for ongoing investigations ,the ,secretary of the ,treasury may not include information in a report required under subsection 7a7 related to ongoing investigations4 #f4 ,report ,not later than the end of the #ahj-;day period beginning on the date of the enactment of this ,act1 the ,secretary of the ,treasury shall issue a report to the appropriate committees of the ,congress containing recommendations for receiving determinations described under section #d from persons other than a primary insurance regulatory authority of a ,state1 including establishing a whistleblower program4 #g4 ,definitions ,in this ,act3 7#a7 ,appropriate committees of the ,congress ,the term appropriate committees of the ,congress means the ,committee on ,financial ,services of the ,house of ,representatives and the ,committee on ,banking1 ,housing1 and ,urban ,affairs of the ,senate4 7#b7 ,maritime insurance ,the term maritime insurance-- 7,a7 means insurance coverage for physical loss or damage of vessels1 cargo1 terminals1 and any transport by which the cargo is transferred1 acquired1 or held between the points of origin and the final destination2 and 7,b7 includes cargo insurance1 freight insurance1 hull insurance1 and protection and indemnity4 7#c7 ,registration ,the term registration means the process-- 7,a7 by which a vessel is formally recognized by a country's maritime authority1 resulting in the vessel's inclusion in the national vessel registry2 and 7,b7 conferring upon a vessel the nationality of the registering state2 7,c7 entailing the right to fly the flag of such registering state2 and 7,d7 subjecting a vessel to the responsibility to adhere to maritime laws and regulations enforced by such registering state4 7#d7 ,state ,the term ,state means any of the several ,states1 the ,district of ,columbia1 a territory of the ,united ,states1 an ,indian ,tribe1 and a jurisdiction subject to the ,compact of ,free ,association ,act of #bjjc4 7#e7 ,vessel ,the term vessel has the meaning given such term in section #c of title #a1 ,united ,states ,code4 ,december #ai1 #bjbc,reported with an amendment1 committed to the ,committee of the ,whole ,house on the ,state of the ,union1 and ordered to be printed