Ocean Shipping Overhaul Added to U.S.-China Competition Bill

A proposal to revamp U.S. international ocean-shipping laws for the first time in more than two decades was added to a sweeping House bill that seeks to bolster competition against China.

The House voted 367-59 to add an update to federal maritime shipping laws as an amendment to the legislation (H.R. 4521) on the floor Thursday, reviving a legislative push to address supply chain bottlenecks at U.S. ports. That also effort got a boost in the Senate, where lawmakers released two related shipping bills.

The House is likely to vote on the U.S-China competition package, which includes billions of dollars to support domestic production of semiconductors, on Friday.

The House already passed the bipartisan shipping legislation, known as the Ocean Shipping Reform Act (H.R. 4996), by a vote of 364-60 in December. It would address a shortage of shipping containers and help the Federal Maritime Commission crack down on unfair ocean carrier practices.

The shipping overhaul is “among the most bipartisan bills considered in the House this Congress,” Rep. John Garamendi (D-Calif.) said during floor debate Thursday. His cosponsor, Rep. Dusty Johnson (R-S.D.), urged Senate Majority Leader Chuck Schumer (D-N.Y.) to put the legislation to a vote.

BGOV Bill Summary: H.R. 4521, U.S.-China Competition Package

Photo: Allison Dinner/Bloomberg

The Port of Boston’s Conley Terminal on Jan. 21, 2022.

Some shipping carriers have found it more lucrative to send empty containers back to Asia rather than use them for exports from the U.S. because there is a shortage of boxes and more demand for imports. The bill would prohibit ocean carriers from unreasonably turning down opportunities for U.S. exports, as decided by the Federal Maritime Commission in a new rulemaking. It would also expand the FMC’s investigation and enforcement powers.

The White House has supported the shipping bill, saying it included “good first steps towards the type of longer-term reform to shipping laws that would strengthen America’s global competitiveness.”

The World Shipping Council has warned the House bill would increase congestion and increase costs for businesses and consumers.

“The House version, in many ways, is just unworkable,” said John Butler, president and CEO of the World Shipping Council. He called it “a political wish list” that would penalize ocean carriers for being unable to fix supply chain congestion issues that are beyond their control.

Ocean Carriers Resist Shipping Rules Advancing in Congress

Senate Bills

Sens. Amy Klobuchar (D-Minn.) and John Thune (R-S.D.) introduced a similar bill, along with 12 additional cosponsors, on Thursday. It’s backed by dozens of agriculture and other trade groups.

The National Milk Producers Federation and the U.S. Dairy Export Council said in a statement after the Senate bill was released that they would continue to work with the senators to strengthen the legislation.

Klobuchar also debuted another shipping bill Thursday that would allow shippers and ports to get involved with legal matters brought by the FMC against ocean carriers. It’s intended to address a concentration of power among three global shipping alliances.

To contact the reporter on this story: Lillianna Byington in Washington at lbyington@bloombergindustry.com

To contact the editor responsible for this story: Sarah Babbage at sbabbage@bgov.com