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World Shipping Council reiterates opposition to proposed U.S shipping reform

The World Shipping Council, which represents global container carriers, has reiterated strong criticism of proposed substantial reform of U.S. shipping legislation, charging it fails to address the root causes of landside congestion that have contributed to shipping logjams at U.S. ports.

 “Instead of passing legislation that would do nothing to address the nation’s supply chain congestion, Congress should seek real solutions that take a comprehensive, forward-looking view,” the WSC said after the Ocean Shipping Reform Act bill was released from committee Tuesday in the Senate, clearing the way for debate.

 “That means continued investment in port infrastructure and promoting communication, innovation, and collaboration across sectors to further strengthen the intermodal transportation system that has supported the U.S. economy throughout the pandemic,” the WSC stated.

The draft legislation previously passed the U.S. House of Representatives and has won support from President Biden. The bill is co-sponsored by a bipartisan group of 27 senators and has won broad endorsements from more than 100 organizations.

The bill emerged as a response to U.S. manufacturers and the agricultural and food communities that cited the business practices of the carriers as major impediments to U.S. exports. Shippers have also strong criticized carriers for what they called abusive and exorbitant detention and demurrage charges while the World Shipping Council responded that the problem is with port infrastructure. They point out that carriers have deployed every available vessel and container and are moving more goods than at any time in history.

“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,” said Senator Amy Klobuchar. of the legislation. “This legislation will help level the playing field for American exporters so they can get their goods to market in a timely manner for a fair price. Now that this bill has passed the Commerce Committee, it is one step closer to being signed into law.”

The Ocean Shipping Reform Act represents the first significant effort in decades to overhaul the rules governing the operations of the carriers and is designed to enhance the authority of the Federal Maritime Commission. A number of elements were added to the bill in markup including giving the FMC new authority to register shipping exchanges as well as additional authority to initiate investigations of ocean carriers as well as enforcement measures. 

 “This legislation would give the FMC greater rulemaking authority to regulate harmful practices by carriers,” said Senator John Thune who co-authored the legislation and argues that it levels the playing field for exporters. “These improvements would provide the FMC with the tools necessary to address unreasonable practices by ocean carriers and hold them accountable for their bad-faith efforts that disenfranchise American producers.”

 (photo Port of Los Angeles)