Congress Passes Legislation to Address Shipping Backlogs

Senator Hoeven Advanced Legislation to Help North Dakota Exporters, Including Ag & Energy Producers, to Access Foreign Markets

WASHINGTON, D.C. — Senator John Hoeven (R-N.D.) issued the following statement after the House of Representatives passed legislation he sponsored to update federal regulations for the global shipping industry and help American producers export their products internationally. The Ocean Shipping Reform Act helps address supply chain challenges by prohibiting ocean carriers from unreasonably declining shipping opportunities for U.S. exports, making it harder for ocean carriers to arbitrarily turn away goods at ports that are ready to be shipped abroad. Further, the bill gives the Federal Maritime Commission (FMC), the federal agency responsible for the regulation of ocean-borne transportation, greater authority to regulate harmful practices by carriers.

As one of the four lead sponsors of the bipartisan legislation, Hoeven, along with Senators Amy Klobuchar (D-Minn.), John Thune (R-S.D.) and Tammy Baldwin (D-Wisc.), helped shepherd the bill through the Senate in March. The legislation now goes to the president to be signed into law.

“Shipping backlogs and supply chain issues have seriously impacted our economy, preventing farmers, ranchers, energy producers and manufacturers, among others, from getting their goods to market and undermining America’s global competitiveness,” said Hoeven. “By holding ocean carriers accountable and prohibiting their unreasonable treatment of U.S. shippers, our legislation will help ensure North Dakota’s exporters have fair and reliable access to foreign markets, which brings tremendous value to our state and its producers.”

Specifically, 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 twenty-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.