KLOBUCHAR : Legislation’s passage represents “a great example of what’s possible when we work together.”
WASHINGTON - On the Senate floor today, U.S. Senator Amy Klobuchar (D-MN) highlighted the Senate passage of the Ocean Shipping Reform Act, her bipartisan legislation with Senator John Thune (R-SD) to help fix supply chains and boost exports.
Klobuchar hailed the Senate passing this legislation unanimously as a “truly bipartisan solution to a problem that’s impacting millions of Americans—and a great example of what’s possible when we work together.”
Klobuchar underscored how the bill will address challenges that American businesses, farmers, and consumers face from ocean carriers’ anticompetitive conduct. “We need to get exports to those who need them, but it’s plainly obvious that the ocean carriers are prioritizing non-American shipments at the expense of both American exporters, as in manufacturers…farmers and American consumers. It isn’t sustainable, and it isn’t acceptable,” said Klobuchar. “We can’t let ocean carriers slow down our supply chain while shaking down our American businesses and farmers for their own profit.”
Senator Thune also took to the Senate floor to applaud the legislation’s passage, praising Klobuchar for her leadership and her “[willingness] to keep grinding and keep working at it…to come up with solutions that are bipartisan, and solutions that really get at problems we're facing in this country.”
The Ocean Shipping Reform Act will level the playing field for American exporters by making it harder for ocean carriers to unreasonably refuse goods ready to export at ports.
Klobuchar took the Senate floor last week to call on her colleagues to pass this legislation, highlighting the significant supply chain disruptions and vulnerabilities U.S. exporters face, caused by international ocean carriers who unreasonably decline shipping opportunities while reaping record profits. The Ocean Shipping Reform Act passed the Senate Commerce Committee unanimously last week.
The legislation earned the endorsement of the American Association of Port Authorities, which represents more than 130 port authorities across North and South America, including the Port of Duluth-Superior. The bill is also endorsed by more than 100 organizations including the Association of Port Authorities, the Agriculture Transportation Coalition (AgTC), the National Retail Federation, the American Trucking Association, the California Association of Port Authorities, the Minnesota Soybean Growers Association, and the Minnesota Corn Growers Association.
In addition to Klobuchar and Thune, the legislation is cosponsored by Senators Maria Cantwell (D-WA), Roger Wicker (R-MS), Tammy Baldwin (D-WI), John Hoeven (R-ND), Debbie Stabenow (D-MI), Roger Marshall (R-KS), Gary Peters (D-MI), Jerry Moran (R-KS), Richard Blumenthal (D-CT), Todd Young (R-IN), Mark Kelly (D-AZ), Mike Crapo (R-ID), Tina Smith (D-MN), Marsha Blackburn (R-TN), Cory Booker (D-NJ), Joni Ernst (R-IA), Catherine Cortez-Masto (D-NV), Mike Braun (R-IN), Raphael Warnock (D-GA), James Risch (R-ID), Michael Bennet (D-CO), Kevin Cramer (R-ND), Ron Wyden (D-OR), Roy Blunt (R-MO), Chris Van Hollen (D-MD), John Boozman (R-AR), Deb Fischer (R-NE), Alex Padilla (D-CA), and John Hickenlooper (D-CO).
Companion legislation was led in the House by Representatives John Garamendi (D-CA) and Dusty Johnson (R-SD) and passed the House with overwhelming bipartisan support by a vote of 364-60.
The Ocean Shipping Reform Act will:
- Require ocean carriers to certify that 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 unreasonably declining shipping opportunities for U.S. exports, as determined by the FMC in new required 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;
- Authorize the FMC to self-initiate investigations of ocean common carrier’s business practices and apply enforcement measures, as appropriate; and
- Establish new authority for the FMC to register shipping exchanges.
Madame President, I rise today to highlight my bill with Senator Thune, which just passed the Senate, the Ocean Shipping Reform Act. We worked for months together on this bill to come to an agreement. We did everything right and got cosponsors on both sides of the aisle. I particularly want to thank Baz, my staff member on the Commerce Committee who did such a great job in working on this. I also want to thank Senators Cantwell and Wicker for their support of the bill, as the Chair and Ranking Member on the Commerce Committee. We worked together on some changes to the bill, and I appreciated their input.
As U.S. Senators representing Minnesota and South Dakota, Senator Thune and I know how crucial it is for American businesses to be able to export throughout the country and across the globe. American farmers feed the world, and consumers and businesses look to them for in-demand agricultural goods like soybeans, corn, dairy, poultry, pork, and beef, just to name a few. And American manufacturers support so many of the essential parts and products that fill our homes, businesses, and store shelves.
And as I look at our economy as we come out of this economic downturn, we must be an economy and a country that makes stuff, that invents things, that exports to the world. And no matter how much American ingenuity we have, and there is a lot of it, if ships, owned by foreign interests are going to other countries with empty containers, and exporting nothing but air and then come to our country filled with foreign goods, that is not exactly an even playing field.
As the past two years have highlighted, significant supply chain disruptions and vulnerabilities have occured.. There are many answers here - one being workforce, one being port infrastructure, and rail infrastructure and the like. But what we have seen when it comes to shipping, and I’m so glad that my colleague from South Dakota has joined me here on the floor, what we have seen in the middle of the country where people are pretty sensible. All of a sudden they're looking at this and they see the price of shipping containers increase by four times in just two years. Four times. That's not normal.
We've also heard from U.S. companies that they have only been able to ship 60 percent of their orders because they can’t access the shipping containers.
At the same time, these ocean carriers – almost all foreign-owned – have reported record profits. It’s estimated that the container shipping industry made a record $190 billion in profits in 2021, a seven-fold increase from the previous year. Their financial performance isn’t a result of improved performance when our manufacturers and farmers can’t ship out their goods. No, they are fleecing consumers and exporters because they know they can get away with it.
And this is all while exporters and consumers are literally paying the price for the supply chain disruptions caused by unreliable service.
We need to get exports to those who need them, but it’s plainly obvious that the ocean carriers are prioritizing non-American shipments at the expense of both American exporters, as in manufacturers, so many of them in Minnesota and South Dakota, as Senator Thune knows, being small businesses, as well as farmers and American consumers. It isn’t sustainable, and it isn’t acceptable.
We can’t let ocean carriers slow down our supply chain while shaking down our American businesses and farmers for their own profit.
That’s why we introduced the Ocean Shipping Reform Act. It just passed the Senate.
Our bill protects American farmers and manufacturers by making it easier for them to ship ready-to-export goods waiting at our ports. Our bill aims to level the playing field for American exporters by updating the federal rules for the global shipping industry. It will give the Federal Maritime Commission greater authority to regulate harmful practices by these big international carriers.
It directs the Federal Maritime Commission to issue a rule prohibiting international ocean carriers from unreasonably declining shipping opportunities for U.S. exports. This will make it harder for them to leave our products behind, just sitting there at a port, in favor of shipping over to China, sailing over to China, and then bringing their products back to us.
In addition to giving the FMC more authority to investigate bad practices by ocean carriers, the bill also directs the Federal Maritime Commission to set new rules for what the international carrier companies can reasonably charge, and require ocean carriers to certify, and ultimately prove, that the fees that they charge are fair. As rates continue to climb, this is more urgent than ever.
And I personally believe that even before this rule goes into effect, the fact that we passed this unanimously in the U.S. Senate sends a pretty strong shot across the bow, because there is so much more we could do and we will do if this practice continues.
As I was working on this bill with Senator Thune, I heard about exporters who wanted to speak out against these predatory practices but were scared into silence because they feared that the ocean carriers would retaliate. That’s why our bill includes strong anti-retaliation protections for shippers.
In short, this bipartisan legislation says to the foreign-owned shipping alliances: charge fair prices, stop profiting off our backs and fill your empty crates with American-made products.
Senator Thune and I have a bipartisan group of 29 cosponsors representing a variety of regions: Senators Cantwell, Wicker, Baldwin, Hoeven, Stabenow, Roger Marshall, Peters, Moran, Blumenthal, Young, Kelly, Crapo, Smith of Minnesota, Blackburn, Booker, Ernst, Cortez Masto the presiding officer, Braun, Warnock, Risch, Bennet, Cramer, Wyden, Blunt, Van Hollen, Boozman, Fischer, Padilla, and Hickenlooper.
The legislation earned the endorsement of the American Association of Port Authorities, which represents more than 130 port authorities across North and South America, including my own Port of Duluth. The bill is also endorsed by more than 100 organizations, including the Agriculture Transportation Coalition, the National Retail Federation, the American Trucking Association, and the Consumer Technology Association.
I also want to mention the House leaders on this bill, Representatives John Garamendi and Dusty Johnson of South Dakota, whose companion legislation has already passed the House.
I see this as a truly bipartisan solution to a problem that’s impacting millions of Americans—and a great example of what’s possible when we work together. I want to congratulate Senator Thune for his great leadership. He may be a bit taller than me, but we have worked together on many, many things across our borders. Thank you.