The Ocean Shipping Reform Act will level the playing field for American exporters by making it harder for foreign-owned ocean carriers to unreasonably refuse goods ready to export at ports

WASHINGTON - U.S. Senators Amy Klobuchar (D-MN) and John Thune (R-SD) and Representatives John Garamendi (D-CA) and Dusty Johnson (R-SD) announced that the Ocean Shipping Reform Act, their bipartisan, bicameral legislation to help fix supply chains and ease shipping backlogs, passed the House by a bipartisan vote of 369-42 and now heads to President Biden’s desk to be signed into law. 

“Congestion at ports and increased shipping costs pose unique challenges for U.S. exporters, who have seen the price of shipping containers increase four-fold in just two years, raising costs for consumers and hurting our businesses. Meanwhile, ocean carriers that are mostly foreign-owned have reported record profits,” said Klobuchar. “This bipartisan legislation will level the playing field for manufacturers, farmers, and consumers – a major win as we work to strengthen our nation’s supply chain. Now that it heads to the White House, we are one step closer to helping American exporters get their goods to market in a timely manner for a fair price.”

“Today’s vote proves that Congress can still do big things in a bipartisan way,” said Thune. “Now that we’ve cleared this hurdle, I’m glad that my Ocean Shipping Reform Act will soon be the law of the land. The common-sense improvements made by this bill will provide the FMC with the tools necessary to address unreasonable practices by ocean carriers and hold them accountable for any bad-faith efforts that disenfranchise American producers, including those throughout South Dakota, who feed the world. Especially as Americans continue to grapple with record-high inflation, this legislation would also benefit consumers by promoting the efficiency of the supply chain.”

“Nine multinational ocean shipping companies formed three consortiums to raise prices on American businesses and consumers by over 1,000% on goods coming from Asia. This allowed these foreign companies to make $190 billion in profits last year—a sevenfold increase in one year,” said Garamendi. “I helped introduce the ‘Ocean Shipping Reform Act’ to provide the Federal Maritime Commission with the necessary regulatory tools to protect American businesses and consumers and address our nation’s longstanding trade imbalance with countries like China. This bill will help crush inflation and protect American jobs. I’m grateful to Senators Klobuchar and Thune as well as Representative Johnson for championing this legislation with me. I am pleased that the bipartisan ‘Ocean Shipping Reform Act’ will be signed into law by President Biden.” 

“Foreign flagged ocean carriers are playing games with American agriculture exports and our bill puts an end to it,” said Johnson. “The Ocean Shipping Reform Act is the strongest fix to our maritime laws in a generation. Americans are facing record inflation, our bill isn’t a silver bullet, but help is on the way. I am proud to have worked on this issue for the last year with Congressman Garamendi, and I am grateful that the House and Senate came to an agreement on these important reforms to our nation’s shipping laws.” 

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.

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 300 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).

In the House, the legislation is cosponsored by a bipartisan group of 96 representatives. 

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 refusing cargo space accommodations for U.S. exports and from discriminating against U.S. exporters;
  • 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.

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