another federal agency for use. In such a situation, or in any other situation, subsection (d) provides that the lessee is to take back any federal oil or gas and pay to the United States an amount equal to the regulated price or if there is no regulated price, the fair market

value.

Presently, section 12(b) of the Outer Continental Shelf Lands Act provides the Federal Government, in emergency situations, has the right to purchase all of the oil or gas obtained from the Outer Continental Shelf. Subsection (f) of this section makes it explicit that nothing in this section is to eliminate that power.

Section 28.-Limitations on Export

The findings, purposes, and policies of the 1977 amendments make it clear that the development of the Outer Continental Shelf is to be one method to reduce dependence on foreign energy sources and increase the domestic supply of oil and natural gas. It is the intention of the committee that oil and gas obtained on the Outer Continental Shelf of the United States be ordinarily reserved for domestic use. Section 28 limits exports of any OCS oil and gas. Exports are to be allowed only in cases of exchange agreements, efficiency, or the national interest, as the President determines, and then only when such exports do not add to dependency on foreign energy sources and when the President makes a specific finding to this effect. The President must submit his findings and recommendations to Congress as to the export of any oil or gas for approval or disapproval. If the Congress, within sixty (60) days, passes a concurrent resolution of disapproval stating that such export would not be in the national interest, further exports

are to cease.

Section 29.-Restriction on Employment

This section prohibits certain Department of Interior employees considered by their position to have had managerial or policymaking responsibility, from accepting employment with any entity regulated under this Act, for 2 years after leaving the Department.

Section 30.-Fishermen's Gear Compensation Fund

The committee was concerned about the possible interference of OCS and OCS-related activity on fishermen. The committee believed that some formal mechanism was necessary to protect commercial fishermen against economic loss resulting from OCS leasing-a Federal action— in cases where they would not otherwise have a prompt and equitable means of obtaining relief. Experience in the North Sea indicates that this may be a fairly serious problem, and the committee sought to provide the Secretary of Interior with the means to deal with the problem.

The committee was aware that substantial local opposition to OCS leasing in some frontier areas, such as the Georges' Bank was due to fears by fishermen about the negative impact of exploration and development and production on their continuing attempts to harvest and collect sufficient quantities of resources to allow them to earn a decent living.

This section authorizes, but does not mandate, the creation of regional Fishermen's Gear Compensation Funds to provide a means by

which commercial fishermen may recover for damages caused to their equipment by activities associated with OCS oil and gas exploration, and development and production. Establishment of one or more funds is permissive, not mandatory. A "commercial fisherman" is specifically defined in subsection 30 (a) to be limited to any citizen of the United States whose primary source of income is derived from the harvesting of living marine resources. Equipment subject to compensation, fishing gear, is defined as any vessel, and any equipment, whether or not attached to a vessel, used in commercial handling or harvesting.. The fund

The Secretary is authorized to establish a fishermen's gear compensation fund for any OCS area to provide reasonable compensation for fishing gear and related damages to commercial fishermen due to OCS related activities. Each such fund may sue or be sued in its own

name.

Each fund would be financed by assessments made part of new OCS. leases in the area concerned, and would be maintained at a level not to exceed $100,000. Specifically, as a condition of any future lease issued under this Act, the lessee must agree to pay amounts, if and as specified by the Secretary, up to $5,000 per year per lease for the purpose of establishing or maintaining a fishermen's fund. Each fund is to be maintained at a level not to exceed $100,000 and, if depleted, is to be replenished by equal assessments on each area leaseholder whose lease was issued after the date of enactment of this Act. In addition, the fund may borrow up to $1,000,000 from the Treasury in the event that the amounts available are not sufficient to pay a fund's obligation.. Payments

A revolving account within the U.S. Treasury is to be established for each fund, to be available to the fund to make authorized payments which is limited to administrative and personnel expenses of the fund, and the payment of claims in accordance with the detailed procedures.

Payments from the fund are to be made for demonstrated actual and consequential damages. Such damages include, but are not necessarily limited to, repair or replacement of the damaged items and loss: of profits, due to the damage of fishing gear by materials, equipment, tools, containers, or other items associated with OCS activities. No payment is to exceed $10,000 per claimant per accident.

It is not intended that these funds supplant liability where responsibility or fault can be shown. To facilitate claims under ordinary tort principles, the Secretary may promulgate regulations establishing and classifying potential hazards to commercial fishing from OCS activities and providing, whenever practicable, for all items used on the OCS to be properly stamped or labelled with the owner's identification prior to their actual use. To make it explicit that the fund is only to be used when other remedies are not available, the section provides that no payment by the fund shall be made when the damage is caused by OCS equipment where the ownership and responsibility for it is known.

Finally, payments by the fund are intended to be made for damages only to the degree the fisherman is not responsible for the injury..

Specifically, no payment shall be made by the fund to the extent that damages were caused by the negligence or fault of the commercial fishermen making the claim.

Claims procedure

The Secretary may prescribe and amend regulations for the filing, processing and settlement of claims. Such regulations may include time limitations on filing and, of course, use of certain forms. As noted earlier, to facilitate non-fund tort claims, the Secretary may classify potential hazards. Such classification, of course, would be helpful in use of a claims procedure under the fund by establishing the types of activities that may result in numerous claims.

Claims are to be referred to a hearing examiner and all lessees in the area are to be notified. Any lessee is entitled to submit evidence at any hearing on a claim.

The hearing examiner can administer oaths and subpoena the attendance of witnesses and the production of books, records and other pertinent evidence and shall promptly adjudicate the case and render a formal decision.

Hearings are to be conducted close to the location of the incident that led to the claim. Specifically, they should be held within the U.S. judicial district wherein the matter giving rise to the claim occurred. If the matter occurred within 2 or more districts, the hearing can be held in any of the affected districts. If such matter occurred outside of any district, it is to be held in the nearest district.

Unless there is a request for judicial review, amounts awarded by the examiner shall be certified to the Secretary, who shall promptly and without any review or modification, disburse the amounts.

Any person suffering legal wrong or who is adversely affected or aggrieved by the decision of a hearing examiner is entitled to seek judicial review in the U.S. Court of Appeals of the nearest circuit or of the District of Columbia, within 60 days. The procedures for such review should be those described in section 23(c) (5) and (c) (6) of this act, except the record to be reviewed shall be that of the examiner. Section 31.-Documentation, Registry and Manning Requirements

The committee was concerned about the testimony of numerous witnesses that foreign workers on the U.S. Outer Continental Shelf have been increasing in recent years. The committee was also aware of recent studies showing that many foreign countries authorizing off-shore exploration, development and production have formally developed policies and programs to require the employment of nationals in off-shore and off-shore-related activity.56

More recently, the General Accounting Office prepared "A Study of the United Kingdom's Approach to Developing North Sea Oil and Gas Reserves (1977)". That report made it clear that a formal criteria of the British Government in granting off-shore leases in a com

56 In 1975, the Ad Hoc Select Committee on the Outer Continental Shelf visited North Sea Petroleum Operations in the United Kingdom and Norway. Chief Counsel to the Committee prepared a detailed Memorandum as to that visit and the Library of Congress prepared a Study of operations. That Memorandum and Study indicated the formal "national" use policies of those countries. See Library of Congress. "North Sea Petroleum Operations in the United Kingdom and Norway" at 6-7 (Scotland) and at 27 (Norway) (November 1976). (hereafter North Sea Study) and Memorandum by Martin H. Belsky, Visit of the Ad Hoc Select Committee on the Outer Continental Shelf to the North Sea, in North Sea Study at 42, 42-47, 49-50, and 53.

pany's past performance and assurances that British citizens will be used in off-shore and off-shore-related activity. In addition, licensees must sign a "memorandum of understanding" between Department of Energy and "United Kingdom Off-shore Operators Association Limited," which provides for preference to Britons in off-shorerelated activities.

Norway, in its legislation concerning the Norwegian Continental Shelf, Fourth Edition (January 1973): "Royal Decree of December 8, 1972, relating to Exploration for and Exploitation of Petroleum in the Seabed and Substrata of the Norwegian Continental Shelf," section 54, similarly requires exploitation to be from Norwegian bases, to give preference to Norwegian goods and services, and makes past performance and future assurances of Norwegian preference a formal criteria in the awarding of leases.

Section 31, or course, does not go as far as these preferences for use of domestic workers in all off-shore and off-shore-related activity. It is limited to crews of OCS facilities and vessels.

The committee was also concerned about the safety of foreign vessels used for OCS activity as evidenced by its adoption of provisions, described above, in section 203 providing for Coast Guard supervision over foreign flag vessels. Section 31 seeks to maximize American employment opportunities during U.S. Outer Continental Shelf operations and to provide the greatest measures of protection for the marine environment from operations involving the exploration, development and production of OCS resources.

Section 31 requires the Secretary of the department in which the Coast Guard is operating to promulgate regulations within 6 months of enactment of the 1977 Amendments to require, with two exceptions, that vessels or other vehicles or structures used for OCS activities be manned or crewed by U.S. citizens or permanent resident aliens. "Permanent resident aliens" are those lawfully admitted to the United States, in accordance with the Immigration and Naturalization Act of 1952, as amended, sections (101) (a) (20), 8 U.S.C. 1101 (a) (20). This requirement is prospective only. It only applies to vessels, vehicles or structures used one year after enactment of the regulations and thus no later than 18 months after enactment of the 1977 amendments. The two exceptions are intended to avoid any disruptions in OCS activities by this manning requirement. First, the requirement does not apply where "specific contractual requirements or national registry requirements in effect at the time of the promulgation of the regulation" provide for foreign personnel. This waives the requirement of this section requiring exclusive use of American citizens or resident aliens when an existing contract already covers operations. In this case, immediately upon the expiration of the contract, the American crew requirement would come into effect.

This also omits from the citizenship or permanent residence requirements those members of the crew of foreign-flag vehicle or structure that come under the manning requirements established under certification of registry of other nations, generally only the marine crew. Any such foreign manning laws enacted after the passage of this law would not be applicable.

Second, section 31 does not apply if "there are not a sufficient number of such citizens or aliens who are qualified and available for work." The committee recognizes that special circumstances may exist which prevent all operators from complying within the prescribed time, and has, in those instances, made allowance for the temporary employment of foreign nationals until qualified U.S. citizens or resident aliens are available.

The provision as to use of citizens and permanent resident aliens applies only to "manning" or "crewing". Thus, a specialist called in to handle an emergency situation would not be included.

Section 31 also requires that any vehicle or structure used one year after the effective date of the regulation and built or rebuilt after this period, "when required to be documented, be documented under the laws of the United States."

This provision is intended to strengthen control over OCS operations by increasing the ability of the Coast Guard to monitor the construction and operations of vehicles used off-shore of the United States. The committee intends that "rebuilt" means substantial repairs or changes and not minor repairs or additions.

The committee recognizes that only vessels can be documented and only vessels of 5 net tons or more which are engaged in commerce must be documented. Vessels can include semi-submersible, submersible, or jack-up drill rigs and drill ships, whether propelled or selfpropelled; platforms are never documented. No fixed rigs (platforms) are required by U.S. law to be documented, because they are not engaged in commerce. Many rigs are documented by the Coast Guard under the classification of seagoing barges because of the owner's need to obtain a marine insurance rating or to gain eligibility for marine finance programs such as the Maritime Administration's Title XI Mortgage Guarantee program.

This section simply provides that when required to be documented, for whatever reason, the rigs would have to be documented in the United States to be eligible to work on the OCS (if the rig is built or rebuilt 1 year after the regulation's promulgation).

Documentation under the laws of the United States can be under one of two types, either certification or "enrollment and license."

Documentation, through a Certificate of Registry can be applied to American or foreign built vehicles. Certification requires that: (1) The vessel be of 20 net tons or more; and (2) it be wholly owned by U.S. citizens. In this context, "citizen" means, for an individual, that he was native born, naturalized, or derived his U.S. Citizenship from his parents. For a corporation it means that it is formed under the laws of the United States or one of the States, that the president or chief executive officer and the chairman of the board are U.S. citizens, and that no more than a minority of a board quorum are noncitizens. Documentation statutes, as such, do not require that any of the shareholders of a corporation which owns a vessel under Certificates of Registry be U.S. citizens.

In order to be eligible to operate in U.S. coastwise trade, documentation under Enrollment and License is necessary. This requires: (1) A minimum that the vessel meet the tonnage and citizen-ownership