A bipartisan bill aimed at making ocean shipping more efficient, lowering shipping costs and addressing price gouging is bound for President Joe Biden’s desk after it passed the House on Monday, as high prices continue to be exacerbated by a supply chain overwhelmed with demand and pandemic-related backlogs.
Joined by west coast members of Congress from California, Washington and Oregon, House Speaker Nancy Pelosi on Tuesday afternoon held a ceremony to enroll the Ocean Shipping Reform Act, noting how high shipping fees were impacting American consumers.
“This week for us is affordability week, how we can lower costs. And lower costs means increasing supply,” Pelosi said. “This legislation will crack down on unfair shipping practices, level the playing field for exporters and bring down costs for working families.”
Democrats, Republicans and exporters alike have cheered the ocean shipping bill, which boosts the authority of the Federal Maritime Commission (FMC) to collect data from ocean carriers on imports and exports, block unfair fees and enforce those measures when needed.
Yet the World Shipping Council, which represents ocean liner companies, criticized in a statement lawmakers’ characterization of the ocean carriers as exploiting the supply chain crisis.
“Throughout the COVID-19 pandemic, ocean carriers have gone all-out to keep goods moving, deploying every vessel and every container available, increasing sailings, and investing for the future,” they wrote.
They pointed to an FMC report last month that found “high ocean freight rates have been determined by unprecedented consumer demand.”
The Ocean Shipping Reform Act does a few key things, including:
Requires ocean carriers to report to the FMC each quarter their total import and exports
Directs the FMC to publish that report online
Directs the FMC to set rules preventing ocean carriers and port operators from adopting “unjust and unreasonable” delay and detention fees
Authorizes the FMC to investigate an ocean carrier's fees and use enforcement if needed
Allows the FMC to issue an emergency order requiring ocean carriers or port operators to share with shippers, rail carriers and trucking companies “information relating to cargo throughput and availability”
President Biden on Tuesday released a statement saying he looks forward to signing the bill into law, a piece of legislation he called for in his State of the Union address in March.
“I called on Congress to address ocean carriers’ high prices and unfair practices because rising ocean shipping costs are a major contributing factor to increased costs for American families,” his statement read. “This bill will make progress reducing costs for families and ensuring fair treatment for American businesses—including farmers and ranchers.”
Michael Dykes, the head of the International Dairy Foods Association, which represents dairy exporters, told reporters in a briefing Tuesday that his organization was especially excited about the ways the legislation could help block unfair demurrage fees, which are imposed for shipping containers delayed on docks.
“We're very pleased to see it pass. We have met with members of Congress. We've had several legislative fly-ins on that,” Dykes said. “We will work with FMC on the rules.”
The legislation was led by Sens. Amy Klobuchar, D-Minn., and John Thune, R-S.D., in the senate and Reps. John Garamendi, D-Calif., and Dusty Johnson, R-S.D.
“Foreign flagged ocean carriers are playing games with American agriculture exports and our bill puts an end to it,” Rep. Johnson said in a statement. “Americans are facing record inflation. Our bill isn’t a silver bullet, but help is on the way.”