House passes Ocean Shipping Reform Act

The House on Wednesday passed H.R. 4996, the Ocean Shipping Reform Act, introduced by Reps. John Garamendi, D-Calif., and Dusty Johnson, R-S.D., by a vote of 364-60.

Garamendi said the bill would:

▪ Establish reciprocal trade to promote U.S. exports as part of the Federal Maritime Commission’s mission.

▪ Require ocean carriers to adhere to minimum service standards that meet the public interest, reflecting best practices in the global shipping industry.

▪ Require ocean carriers or marine terminal operators to certify that any late fees — known in maritime parlance as “detention and demurrage” charges — comply with federal regulations or face penalties.

▪ Shift burden of proof regarding the reasonableness of “detention or demurrage” charges from the invoiced party to the ocean carrier.

▪ Prohibit ocean carriers from declining opportunities for U.S. exports unreasonably, as determined by the FMC in new required federal rulemaking.

▪ Require ocean common carriers to report to the FMC each calendar quarter on total import/export tonnage and 20-foot equivalent units (loaded/empty) per vessel that makes port in the United States.

National Fisheries Institute President John Connelly said, “The bill is a good start and is a recognition that Washington can and should play a role in fixing a broken value chain. Especially for small businesses, the supply chain crisis continues unabated, and whether it’s preventing shipping lines from sending empty containers back or expanding U.S. enforcement powers, a focus on these issues now is needed.”

The U.S. Dairy Export Council and the National Milk Producers Federation, which support the bill along with other U.S. agricultural interests, said, “If passed by the Senate and signed into law, the legislation will help alleviate delays and disruptions at U.S. ports that have cost the U.S. dairy industry well over $1 billion this year. American dairy exporters since late 2020 have faced unprecedented challenges in securing shipping container accommodations on ocean vessels while contending with record-high fees and shipping access volatility, most of which has been driven by foreign-owned ocean carriers.”


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