From Shutdown to Smooth Sailing

Editors' Note: Hailey, one of the newest members of Holland & Knight's Maritime Team, brings a significant background in maritime and transportation-related disputes, cross-border litigation, regulatory exposure and class action risk. She has an industry-informed perspective from working shipboard for a global cruise line and in-house with a multinational cruise company, where she supported litigation strategy, conducted claims investigations and managed contracts across multiple jurisdictions.

More than six years ago, the Centers for Disease Control and Prevention's (CDC) March 2020 No Sail Order brought the global cruise industry to a standstill. It was this monumental halt that prompted former FMC Chair, then Commissioner, Louis E. Sola to initiate Fact Finding 30 (FF30). Four years after the final report of Fact Finding Investigation No. 30 (FF30 Final Report) on January 14, 2022, the cruise sector has not merely recovered – it has surpassed every pre-pandemic benchmark.

Global passenger volume reached a record 37.2 million in 2025, eclipsing the 2019 record of 29.7 million by roughly 25 percent, per the 2026 State of the Cruise Industry Report issued by the leading cruise industry association in the country. That trajectory, from historic shutdown to historic growth, offers an opportunity to revisit FF30's role in helping the FMC identify regulatory gaps, inform needed reforms and lay important groundwork for the cruise industry's stabilization and revival.

Full Steam Ahead, Then All Stop

The cruise industry was on a sustained upward trajectory heading into 2020. Global ocean-going passenger volume had climbed from 25.2 million in 2016 to 26.7 million in 2017, 28.5 million in 2018 and a then-record 29.7 million in 2019, per annual market reports published by the leading cruise industry association. In the United States, the industry generated more than $25 billion in direct spending and supported an estimated 436,000 jobs in 2019. The industry's upward trajectory was brought to a halt with the spread of COVID-19 and CDC's subsequent issuance of the No Sail Order on March 14, 2020, triggering an industry-wide suspension that would ultimately cost an estimated $39 billion in economic activity and roughly 301,000 American jobs over the following 12 months. (See No Sail Order and Other Measures Related to Operations, 85 Fed. Reg. 16628 (March 24, 2020) (effective March 14, 2020).)

Charting the Course: FF30's Origins and Mandate

On April 30, 2020 – just six weeks after the shutdown began – the FMC designated Commissioner Sola as Fact Finding Officer under 46 C.F.R. §§ 502.281-91, granting him investigative authority (including subpoena power, depositions and hearings) to assess COVID-19's impact on cruise passengers, passenger vessel operators (PVOs) and port communities. Over the next 20 months, Commissioner Sola produced eight interim reports before issuing his comprehensive Final Report in January 2022.

An Outsized Economic Footprint

Although cruise ships constitute less than 1 percent of the world's commercial fleet by vessel count, the industry punches well above its weight economically. Moreover, the workforce is genuinely international: Cruise lines draw from more than 150 countries, employing roughly 300,000 seafarers alongside tens of thousands of additional shoreside employees across ports, terminals, shipyards and travel agencies. Domestically, the cruise industry contributed $75 billion in economic impact in the U.S. in 2024, supporting 333,000 jobs and more than $25 billion in wages. This outsized domestic and global footprint helps explain why the FMC's engagement through FF30 carries significance beyond the Commission's traditional regulatory focus.

The FMC's Jurisdiction and Role in Cruise Line Operations

To fully appreciate FF30's significance, one must first understand the jurisdictional waters in which the FMC operates. As the FF30 Final Report observes, "no single federal agency has exclusive or comprehensive authority over cruise lines." (See Final Report of Fact Finding Investigation No. 30: COVID-19's Impact on Cruise Industry at 34, Fed. Mar. Comm'n (Jan. 14, 2022).) The FMC's core cruise-related mandate is to ensure that PVOs maintain adequate financial responsibility to indemnify passengers for nonperformance of transportation and meet any liability for death or injury under 46 U.S.C. Chapter 441. Per the FMC's most recent Congressional Budget Justification, the Commission oversees PVOs that carry 50 or more passengers and embark at U.S. ports (encompassing 327 industry-member ocean-going vessels as of 2026).

The FMC's limitations are equally instructive: It cannot order a cruise line to cancel a voyage, compel a refund when a passenger voluntarily cancels or regulate general customer-service issues such as itinerary changes or cabin concerns. Id. at 35-36. Health and safety protocols fall to the CDC and vessel safety to the U.S. Coast Guard. The Commission's Office of Consumer Affairs and Dispute Resolution Services (CADRS) is available to assist passengers with resolving cruise-related disputes through alternative dispute resolution services, including ombuds assistance, mediation and facilitation; however, participation is voluntary for both passengers and cruise lines, and the FMC lacks statutory authority to compel specific cruise line action or regulate and enforce the terms of a passage contract. Id. at 37-38; see also 46 C.F.R. § 502.401 (outlining CADRS services). Personal injury claims fall outside the FMC's purview entirely.

On January 2, 2025, the FMC issued a policy statement clarifying that private parties may bring class action complaints within the Commission's jurisdiction, raising an interesting consideration for cruise passengers. Though most major cruise lines' passage contracts contain both exclusive forum selection clauses designating the U.S. District Court for the Southern District of Florida and class action waivers, FMC precedent makes plain that the FMC must hear causes of action arising under the Shipping Act so long as they concern uniquely FMC-regulated activities. Though this jurisdictional question has not been conclusively answered in the context of cruise class actions, it is expected that the class action powers arising in the cruise context will be tested at the FMC notwithstanding the forum selection clauses within cruise tickets. This regulatory framework – targeted in scope, robust within its lane and transparent about its limits – is what FF30 helped illuminate and, ultimately, strengthen.

Sounding the Depths: FF30's Key Findings

The investigation, fact finding, interim reports and FF30 Final Report operated across several principal workstreams, each helping the Commission examine a distinct dimension of the crisis.

On the regulatory relief front, then-Commissioner Sola's Initial Report identified that existing financial responsibility requirements, which obligated PVOs to post surety bonds equal to 110 percent of their highest unearned passenger revenue, capped at $32 million, were tying up capital-limited operators needed for survival. The Commission unanimously adopted a Policy Statement on July 23, 2020, allowing small PVOs to request alternative forms of financial responsibility based on their current monthly unearned passenger revenue rather than the prior two years' higher figures, thereby freeing up capital during the shutdown.

Turning to consumer protection, FF30 helped surface the limitations of existing refund frameworks: Historically, passengers whose voyages were cancelled often faced inconsistent policies, opaque timelines and limited recourse. Commissioner Sola's findings informed the Commission's decision to issue an Advance Notice of Proposed Rulemaking (ANPRM) in October 2020, 85 Fed. Reg. 62972 (Oct. 6, 2020) and a Notice of Proposed Rulemaking (NPRM) on August 24, 2021, 86 Fed. Reg. 47294 (Aug. 24, 2021), proposing uniform refund procedures and direct claims against PVOs' financial responsibility instruments. That rulemaking process culminated in the Final Rule published on March 17, 2022, 87 Fed. Reg. 15122 (Mar. 17, 2022), which now requires passengers to be fully refunded within 180 days for all fees paid to the cruise line, including ancillary fees, and allows passengers to make direct claims against PVOs' surety bonds if the cruise line fails to provide a refund.

On the economic documentation front, six regional economic impact reports gave policymakers granular data on the shutdown's toll, documenting the $39 billion in losses, state-by-state job reduction and the industry's deep multiplier effects across ports, hotels, airlines and small businesses. Beyond these analytical efforts, Commissioner Sola took the investigation outside Washington – coordinating with the White House COVID-19 Task Force, traveling to Alaska's port communities and working with the Alaska delegation on the Alaska Tourism Restoration Act (H.R. 1318, signed May 24, 2021), which temporarily waived the Passenger Vessel Services Act (PVSA) to allow foreign-flagged cruise ships to sail directly from Washington state to Alaska without the previously required stop in Canada, whose ports remained closed to cruise ships through early 2022. Then-Commissioner Sola also advocated for vaccination of port workers and U.S. vaccine assistance to Caribbean and Central American nations supporting the cruise industry.

From Investigation to Implementation: FF30's Legacy

The deliberative process FF30 informed culminated in the FMC's Final Rule. That framework has since been tested. According to the FMC's Fiscal Year (FY) 2022 Performance and Accountability Report, the FMC's PVO certification program certified 258 vessels with aggregate financial responsibility coverage exceeding $800 million for nonperformance and $700 million for casualty. The coverage proved its value when Vantage Travel Services filed for Chapter 11 bankruptcy in July 2023 and again when American Queen Voyages ceased operations in February 2024. In both cases, the FMC issued passenger notices advising travelers of their rights.

Looking to the Industry's Next Horizon

As the cruise industry charts new records and new operators enter the market, the regulatory architecture that FF30 helped illuminate and refine helps position the FMC to fulfill its mandate with confidence. Then-Commissioner Sola closed his final report stating: "Americans are resourceful, enterprising, and resilient, none more so than the men and women who make their living on our waterways. In times when these people need a hand, regulators should be nimble, adaptive, and willing to provide relief where it can make a difference." Final Report of Fact Finding Investigation No. 30 at 80. More than four years later, that relief can be seen in passengers' considerations, as well as for operators and within the communities whose livelihoods depend on a thriving cruise industry.

With the Final Rule's fifth anniversary approaching in March 2027 and with now-FMC Chairman Laura DiBella and new Commissioner Bob Harvey grounded in the Florida maritime scene, it would not be surprising if the findings are revisited and updated to reflect the evolving maritime landscape following the Trump Administration's Maritime Action Plan.