The Office of the United States Trade Representative (USTR) has proposed sweeping new measures targeting China’s growing dominance in global maritime sectors. These would encompass potential fees of up to $1.5 million per port call for Chinese-built vessels.
The USTR indicated that stakeholders can provide feedback on the proposed measures at a public hearing scheduled for March 24 at the International Trade Commission. The same date applies to written comments.
The proposed measures follow the recent release of a USTR Section 301 investigation which determined that “China’s acts, policies, and practices to be unreasonable and to burden or restrict US commerce.” The investigation was launched in response to a petition filed in March 2024 by five leading US labor unions, including the United Steel Workers and the AFL-CIO.
In the petition, the unions called for fees on Chinese-built vessels docking at US ports, with costs varying based on vessel tonnage and age. A proposed “US Commercial Shipbuilding Revitalization Fund” would collect these fees to support the Construction Differential Subsidy program, which historically supported domestic shipbuilders prior to its 1982 defunding.
According to the USTR report, China’s rise in global ship production has surged dramatically from less than 5% in 1999 to over 50% in 2023. China also controls 95% of global shipping container production and 86% of the world’s intermodal chassis supply. In addition, China’s ownership of the world commercial fleet attained over 19% as of January 2024.
“China frames its targeting for dominance in the maritime, logistics, and shipbuilding sectors in nationalistic terms as a zero-sum contest pitting companies it controls against all others,” states the USTR report. It affirms that China’s state-backed entities benefit from extensive subsidies, preferential financing, and regulatory advantages that distort global competition.
Under the proposed measures, carriers with fleets comprising more than 50% Chinese-built vessels face fees up to $1 million per US port call, whereas those with 25-50% Chinese-built vessels would pay up to $750,000 per call. The measures would also mandate increasing percentages of U.S. exports to be carried on American-flag vessels, with the requirements rising to 15% within seven years.
(Photo of OOCL vessel in Port of Long Beach)