--- kind: "section" citation: "46 U.S.C. § 53722" title: "46" title_heading: "Shipping" number: "53722" heading: "Actions by Secretary or Administrator" release: "119-102" date: "2026-07-12" url: "https://uscodex.org/usc/46/53722" units: - "Subtitle V — Merchant Marine" - "Part C — Financial Assistance Programs" - "Chapter 537 — Loans and Guarantees" - "Subchapter II — Default Provisions" --- # §53722. Actions by Secretary or Administrator - (a) **General Authority.—** On default under an [obligation](/usc/46/53701.md?p=9) or related [agreement](/usc/46/53201.md?p=8) between the [Secretary](/usc/46/53101.md?p=8) or [Administrator](/usc/46/53701.md?p=2) and the [obligor](/usc/46/53701.md?p=11), the [Secretary](/usc/46/53101.md?p=8) or [Administrator](/usc/46/53701.md?p=2), on terms that may be provided in the [obligation](/usc/46/53701.md?p=9) or [agreement](/usc/46/53201.md?p=8), may— - (1) assume the [obligor](/usc/46/53701.md?p=11)’s rights and duties under the [obligation](/usc/46/53701.md?p=9) or [agreement](/usc/46/53201.md?p=8), make any payment in default, and notify the [obligee](/usc/46/53701.md?p=10) or the [obligee](/usc/46/53701.md?p=10)’s agent of the default and the [Secretary](/usc/46/53101.md?p=8)’s or [Administrator](/usc/46/53701.md?p=2)’s assumption; or - (2) notify the [obligee](/usc/46/53701.md?p=10) or the [obligee](/usc/46/53701.md?p=10)’s agent of the default. - (b) **Demands by Obligees.—** - (1) **Demand.—** If the [Secretary](/usc/46/53101.md?p=8) or [Administrator](/usc/46/53701.md?p=2) proceeds under [subsection (a)(2)](#a-2), the [obligee](/usc/46/53701.md?p=10) or the [obligee](/usc/46/53701.md?p=10)’s agent may demand that the [Secretary](/usc/46/53101.md?p=8) or [Administrator](/usc/46/53701.md?p=2) pay the unpaid principal amount of the [obligation](/usc/46/53701.md?p=9) and the unpaid interest on the [obligation](/usc/46/53701.md?p=9). The demand must be made within the earlier of— - (A) a period that may be specified in the guarantee or a related [agreement](/usc/46/53201.md?p=8); or - (B) 60 days from the date of the [Secretary](/usc/46/53101.md?p=8)’s or [Administrator](/usc/46/53701.md?p=2)’s notice. - (2) **Payment.—** If a demand is made under [paragraph (1)](#b-1), the [Secretary](/usc/46/53101.md?p=8) or [Administrator](/usc/46/53701.md?p=2) shall pay to the [obligee](/usc/46/53701.md?p=10) or the [obligee](/usc/46/53701.md?p=10)’s agent the unpaid principal amount of the [obligation](/usc/46/53701.md?p=9) and the unpaid interest on the [obligation](/usc/46/53701.md?p=9) to the date of payment. Payment shall be made within the earlier of— - (A) a period that may be specified in the guarantee or a related [agreement](/usc/46/53201.md?p=8); or - (B) 30 days from the date of the demand. - (c) **Continued Effect of Guarantee.—** A guarantee of an [obligation](/usc/46/53701.md?p=9) remains in effect after an assumption of the [obligation](/usc/46/53701.md?p=9) by the [Secretary](/usc/46/53101.md?p=8) or [Administrator](/usc/46/53701.md?p=2). - (d) **Additional Responses.—** If there is a default on an [obligation](/usc/46/53701.md?p=9), the [Secretary](/usc/46/53101.md?p=8) or [Administrator](/usc/46/53701.md?p=2) shall conduct operations under this chapter in a manner that— - (1) maximizes the net present value return from the sale or disposition of assets associated with the [obligation](/usc/46/53701.md?p=9), including prompt referral to the Attorney General for collection as appropriate; - (2) minimizes the amount of any loss realized in the resolution of the guarantee; - (3) ensures adequate competition and fair and consistent treatment of offerors; and - (4) requires appraisal of assets by an independent appraiser. ## Source credit (Pub. L. 109–304, § 8(c), Oct. 6, 2006, 120 Stat. 1618; Pub. L. 109–163, div. C, title XXXV, § 3507(a)(1)(C), (F), Jan. 6, 2006, 119 Stat. 3555; Pub. L. 110–181, div. C, title XXXV, § 3522(a)(10)(B), (11), (b), Jan. 28, 2008, 122 Stat. 598.) ## Notes | Historical and Revision Notes | | | | --- | --- | --- | | Revised
Section | Source (U.S. Code) | Source (Statutes at Large) | | 53722(a), (b) | 46 App.:1275(b). | June 29, 1936, ch. 858, title XI, § 1105(b), as added June 23, 1938, ch. 600, § 46, 52 Stat. 971; Aug. 15, 1953, ch. 513, § 3, 67 Stat. 626; Sept. 3, 1954, ch. 1265, § 5, 68 Stat. 1272; Aug. 7, 1956, ch. 1026, § 1(e)–(g), 70 Stat. 1087; Pub. L. 85–520, July 15, 1958, 72 Stat. 358; Pub. L. 91–469, § 33, Oct. 21, 1970, 84 Stat. 1035; restated Pub. L. 92–507, § 3, Oct. 19, 1972, 86 Stat. 914; Pub. L. 97–31, § 12(136), Aug. 6, 1981, 95 Stat. 166; Pub. L. 98–595, § 1(9), Oct. 30, 1984, 98 Stat. 3131. | | 53722(c) | 46 App.:1273(e) (last sentence). | June 29, 1936, ch. 858, title XI, § 1103(e) (last sentence), as added Pub. L. 98–595, § 1(1), Oct. 30, 1984, 98 Stat. 3130. | | 53722(d) | 46 App.:1275(f). | June 29, 1936, ch. 858, title XI, § 1105(f), as added Pub. L. 108–136, title XXXV, § 3524, Nov. 24, 2003, 117 Stat. 1801. | In subsection (a), before paragraph (1), the words “an obligation or related agreement” are substituted for “a mortgage, loan agreement, or other security agreement” for consistency in the revised chapter. ### Editorial Notes ### Amendments 2008—Pub. L. 110–181, § 3522(b), repealed Pub. L. 109–163, § 3507(a)(1)(C), (F). See 2006 Amendment note below. Pub. L. 110–181, 3522(a)(10)(B), (11), incorporated the substance of the amendment by Pub. L. 109–163, § 3507(a)(1)(C), (F), into this section by inserting “or Administrator” after “Secretary” in section catchline and wherever appearing in subsecs. (a) to (c) and “or Administrator’s” after “Secretary’s” in subsecs. (a)(1) and (b)(1)(B). See 2006 Amendment note below and section 18(a) of Pub. L. 109–304, set out as a Legislative Purpose and Construction note preceding section 101 of this title. Subsec. (d). Pub. L. 110–181, § 3522(a)(10)(B), inserted “or Administrator” after “Secretary” in introductory provisions. 2006—Pub. L. 109–163, § 3507(a)(1)(C), (F), which directed the amendment of sections 1273(e) and 1275(b) of the former Appendix to this title from which this section was derived in part, was repealed by Pub. L. 110–181, § 3522(b). See 2008 Amendment notes and Historical and Revision notes above.