The U.S. Senate introduced on Thursday its version of legislation aimed at promoting U.S. exports while curbing carriers’ power over both container service and equipment fees charged to shippers.
The Ocean Shipping Reform Act (OSRA) is similar to legislation that passed overwhelmingly late last year in the U.S. House, though it lacks some of the specifics of the earlier bill. Both bills would give the Federal Maritime Commission authority to initiate rulemakings, making it more difficult for ocean carriers to refuse service to American exporters.
“Congestion at ports and increased shipping costs pose unique challenges for U.S. exporters, who have seen the price of shipping containers increase fourfold in just two years. Meanwhile, ocean carriers have reported record profits,” said Sen. Amy Klobuchar, D-Minn., who cosponsored the bill with Sen. John Thune, R-S.D.
“This legislation will level the playing field by giving the [FMC] greater authority to regulate harmful practices by carriers and set rules on what fees carriers can reasonably charge shippers and transporters.”
The Senate’s version of OSRA would:
- Prohibit ocean carriers from unreasonably declining opportunities for U.S. exports, as determined by the FMC in a new required rulemaking.
- Promote transparency by requiring ocean common carriers to report to the FMC each calendar quarter on total import/export tonnage and twenty-foot equivalent units (loaded or empty) per vessel that makes port in the United States.
- Authorize the FMC to self-initiate investigations of ocean common carriers’ business practices and apply enforcement measures, as appropriate.
- Establish new authority for the FMC to register shipping exchanges to improve the negotiation of service contracts.
Language in the Senate bill is not as strong as the House version on imposing import-export reciprocity on carriers. However, both bills include certification requirements for carriers when imposing demurrage and detention fees.
It is also expected that, unlike in the House, the bill will be subjected to more deliberate negotiations with an open markup for amendments.
The head of the U.S. Dairy Export Council (USDEC) said she will work with Congress to strengthen the measure.
“This Senate bill takes strong strides to address many of the challenges dairy exporters have faced, including securing export vessel bookings and combating unfair detention and demurrage charges, vital issues to ensure our products reach their intended destinations,” commented USDEC President and CEO Krysta Harden.
“We look forward to continuing to work with Senators Klobuchar and Thune, and others in Congress, to address outstanding concerns and provide for the strongest possible reforms.”
