Investor Presentaiton

Regulatory Context State of the Island ☐ Puerto Rico is subject to the same U.S. customs regulations and tariffs that are applicable to all other ports on the U.S. mainland and in Alaska and Hawaii. There is no Customs surcharge for Puerto Rico. ■ Per Export.gov shipments to Puerto Rico, as a U.S. territory, are not considered exports so duties are not applied. Puerto Most goods arriving at the port are liable for Puerto Rico sales and use taxes that are calculated and paid before the items leave port ("PICO system") Goods shipped between Puerto Rico and the CONUS must file Electronic Export Information (EEI). The EEI is is the electronic data filed in the US Customs and Border Automated Export System (AES). This information is mandated to be filed through the Automated Export System or ACE AESDirect and is an electronic declaration of merchandise. The information is used to help compile U.S. export and trade statistics. It is also used by other government agencies for trade enforcement purposes. Jones Act - Maritime Cabotage Stevens Amendment - Air Cabotage Background The Jones Act requires all goods shipped between two U.S. points (Jacksonville to San Juan, for example) be carried on American built, American crewed, and American owned vessels. The Act does not require goods from overseas be shipped to Puerto Rico on U.S.-flag vessels, does not slap taxes on foreign ships servicing Puerto Rico, and has not prevented the distribution of aid to Puerto Rico. Argument The Jones Act increases the cost of goods and services shipped to and from Puerto Rico ■ Suggested action by those in opposition. Repeal of the Jones Act Background Federal law does not allow U.S. carriers to use excess capacity of their foreign partners to move international cargo. The foreign carrier must make the full trip by itself. It is prohibited from transferring cargo to or from a U.S. carrier flying the international leg of the journey. In 2004, a USDOT exemption for Alaska in the FAA authorization passed the Stevens Act. This allowed landed cargo in Alaska, on its way to and from the lower 48 states, to be shuffled among planes and carriers at that time without being subject to federal regulations. Argument Puerto Rico is well-placed geographically; it is relatively easy to fly to the US, Europe, South America, Central America, and the Caribbean. A "Stevens Amendment for Puerto Rico" would help economic development on the Island, allowing: the entry of new air cargo companies, a greater usage of its capacity for the benefit of the international transport, and the creation of new jobs. Additionally, the foreign airlines would not be penalized for stopping in Puerto Rico, which creates a mutual profitable relationship. ☐ Suggested action by those in favor. Adoption of similar regulations as the Stevens Act. SEABURY MARITIME 27

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