Cabotage

These are laws that govern the transportation of goods from two points within the same country. These laws normally dictate that this transportation has to be done by a carrier “from” that country (in quotes because this is subject to wide interpretation).

The biggest usage is in shipping. In the United States, cabotage laws – in the form of The Jones Act – dictate that goods and passengers moving between two U.S. ports can only be performed by a U.S.-based carrier on a ship manufactured in the U.S.

These laws exist to protect a country’s domestic shipping industry, and to ensure that the country is not dependent on a foreign power to move goods internally.

Cabotage can also be applied to ground transportation and aviation, though this is much more rare.

In the U.S., The Jones Act leads to some strange and undesirable side effects, such as goods in Puerto Rico being extremely expensive, and natural gas having to be imported from other countries even when domestic natural gas is available, simply because there are no domestic ships available to transport it.

Many have complained that the Jones Act is outdated and should be repealed.