The Secretary—

(1) may remove from an active status a Reserve officer who has twice failed of selection to the next higher grade; and

(2) shall remove from an active status a Reserve officer serving in the grade of captain who has completed thirty years of total commissioned service and whose name is not carried on an approved list of selectees for promotion to the grade of rear admiral (lower half).

A Reserve officer who has twice failed of selection to the next higher grade and who is not removed from an active status under subsection (a)(1) of this section shall be retained for the period prescribed by the Secretary.

Subject to section 12646 of title 10, a Reserve officer who is removed from an active status under subsection (a) of this section shall be given an opportunity to transfer to the Retired Reserve, if qualified, but unless so transferred shall, in the discretion of the Secretary, be transferred to the inactive status list or discharged as follows:

(1) if removed from an active status under subsection (a)(1) of this section, on June 30 next following the approval date of the board report by virtue of which the officer’s second failure of selection occurs; or

(2) if removed from an active status under subsection (a)(2) of this section, on June 30 next following the date on which the officer completes thirty years of total commissioned service as computed under this section.

For the purpose of this section, the total commissioned service of an officer who has served continuously in the Reserve following appointment in the grade of ensign shall be computed from the date on which that appointment to the Reserve was accepted. A Reserve officer initially appointed in a grade above ensign is considered to have the actual total commissioned service performed in a grade above commissioned warrant officer or the same total commissioned service as an officer of the Regular Coast Guard who has served continuously from an original appointment as ensign, who has not lost numbers or precedence, and who is, or was, junior to the Reserve officer, whichever is greater.

(Added Pub. L. 96–322, § 1, Aug. 4, 1980, 94 Stat. 1013, § 740; amended Pub. L. 97–417, § 2(15), Jan. 4, 1983, 96 Stat. 2086; Pub. L. 99–145, title V, § 514(c)(1), Nov. 8, 1985, 99 Stat. 629; Pub. L. 103–337, div. A, title XVI, § 1677(b)(5), Oct. 5, 1994, 108 Stat. 3020; Pub. L. 112–213, title II, § 217(14), Dec. 20, 2012, 126 Stat. 1558; renumbered § 3751, Pub. L. 115–282, title I, § 118(b), Dec. 4, 2018, 132 Stat. 4233.)