Shipping Reform Legislation to Ease Bottlenecks Signed into Law

A crowded Port of Long Beach container terminal. Photo: POLB.

On June 16, President Biden signed into law the Ocean Shipping Reform Act of 2022, legislation that officials hope can help alleviate challenges along the supply chain.

The measure was passed by a vote of 369-42 in the U.S. House of Representatives on June 13, which followed a 364-60 vote by the Senate in December 2021.

The new law broadens the Federal Maritime Commission’s authority to promote U.S. exports and allow it to create a shipping exchange registry. It also could help to make the detention and demurrage complaint process more efficient and clarify ocean-carrier practices related to detention and demurrage charges and space accommodations on vessels.

“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,” President Biden said in a statement. “This bill will make progress reducing costs for families and ensuring fair treatment for American businesses.”

Rep. John Garamendi, D-California, one of the lawmakers who sponsored the bill, remarked that “nine multinational ocean shipping companies formed three consortiums to raise prices on American businesses and consumers” on goods coming from Asia.

“This allowed these foreign companies to make $190 billion in profits last year—a seven-fold increase in one year,” he said.

Garamendi said he introduced the Ocean Shipping Reform Act to provide the FMC with the “necessary tools to protect American businesses and consumers and address America’s longstanding trade imbalance with China and other countries.”

“This bill will help crush inflation and protect American jobs,” he remarked.

The chair of the House Committee on Transportation and Infrastructure, Rep. Peter DeFazio, D-Oregon, celebrated the passage of the legislation, saying that it would make tangible improvements for American exporters, “easing our international supply chains and helping keep prices down for consumers.”

“This critical legislation will build on actions that House Democrats and the Biden Administration have already taken to alleviate our congested ports and boost competition,” he said.