Ocean Shipping Reform Act set for signature

Written by Nick Blenkey
House passes Ocean Shipping Reform ACt

Image: Architect of the Capitol

After passing the House yesterday, S. 3580, the Ocean Shipping Reform Act of 2022 (OSRA), is on its way to President Biden, who is no fan of the giant container alliances and is looking forward to signing it.

“Lowering prices for Americans is my top priority, and I applaud the Congress for passing the Ocean Shipping Reform Act on a bipartisan basis, which will help lower costs for American retailers, farmers and consumers, “ the President said yesterday. “I want to thank Senator Klobuchar, Senator Thune, Rep. Garamendi, and Rep. Dusty Johnson for their leadership and helping drive forward this important legislation.

“In my State of the Union address, 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. During the pandemic, ocean carriers increased their prices by as much as 1,000%. And, too often, these ocean carriers are refusing to take American exports back to Asia, leaving with empty containers instead. That’s costing farmers and ranchers—and our economy—a lot of money.

“This bill will make progress reducing costs for families and ensuring fair treatment for American businesses—including farmers and ranchers. I look forward to signing it into law.”

So, what does the Ocean Shipping Reform Act actually do?

Specifically, the legislation aims to:

  • Expand safeguards to combat retaliation and deter unfair business practices;
  • Clarify prohibited carrier practices pertaining to detention and demurrage charges and vessel space accommodation;
  • Establish a shipping exchange registry through the FMC;
  • Expand penalty authority to include refund of charges;
  • Increase efficiency of the detention and demurrage complaint process.

Commenting on passage of the legislation, Federal Maritime Commission Chairman Daniel B. Maffei said that lawmakers had heard clearly the calls for help from American manufacturers, farmers, and companies that rely on access to international ocean cargo services.

“This bill provides needed and overdue updates to the laws the Federal Maritime Commission enforces,” said Chairman Maffei. “These changes will have a beneficial effect on how U.S. shippers are served and will bring more accountability to how ocean cargo services are provided. We will move promptly to implement the steps necessary to bring shippers the benefits of this legislation, beginning with the rulemaking addressing export shipments.”

“OSRA will provide the FMC with enhanced authority to ensure industry players have the right incentives and that all stakeholders in the ocean freight transportation system can have a voice,” he added. “We are grateful for all those who have contributed to making the Commission a more robust and capable entity.”

Download the text of the legislation HERE

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