U.S. Senators Amy Klobuchar (D-Minn.) and John Thune (R-S.D.) announced that the Ocean Shipping Reform Act, their bipartisan legislation to help fix supply chains and ease shipping backlogs, passed the Senate unanimously.
“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. This legislation will help American exporters get their goods to market in a timely manner for a fair price,” Klobuchar said. “By passing this bill, we are one step closer to leveling the playing field for American manufacturers and consumers.”
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 Minnesota Soybean Growers Association deeply appreciates the bipartisan work on the difficulties Minnesota’s soybean growers have had with container exports,” MSGA President Mike Skaug said. “Container access in Minnesota historically has been difficult and that difficulty has increased in the past years to a near impossibility. Export markets are vital to Minnesota’s specialty soybean growers. Balancing the power of shippers and guaranteeing fair access to ships is vital to the agriculture sector of Minnesota’s economy. MSGA thanks Senator Klobuchar for her work on these difficult issues.”
Klobuchar took the Senate floor last week to call on her colleagues to pass this legislation, highlighting the significant supply chain disruptions and vulnerabilities U.S. exporters face, caused by international ocean carriers who unreasonably decline shipping opportunities while reaping record profits. Thune also spoke on the Senate floor, where he called for the bill’s swift passage and noted the long-term positive changes that would benefit exporters, importers, and consumers. The Ocean Shipping Reform Act passed the Senate Commerce Committee unanimously last week.
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 100 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 also cosponsored by Sen. Tina Smith.
Companion legislation was led in the House by Representatives John Garamendi (D-Calif.) and Dusty Johnson (R-S.D.) and passed the House with overwhelming bipartisan support by a vote of 364-60.
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 declining shipping opportunities for U.S. exports, as determined by the FMC in new required rulemaking;
- 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.