Jun 16, 2022

Biden signs Ocean Shipping Reform Act

President Joe Biden has signed the Ocean Shipping Reform Act of 2022, which is designed to ease supply chain challenges leading to port congestion, reduced exports of U.S. agricultural products and higher prices.

Biden signed the legislation June 16.

The legislation, passed by the House on June 13 and the Senate in December, expands the authority of the Federal Maritime Commission (FMC) to promote U.S. exports through a “maritime system that is transparent, efficient and fair,” according to a news release from Democratic members of the House Transportation Committee.

The Ocean Shipping Reform Act puts into motion steps to address the supply disruptions:

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

Reaction to the Ocean Shipping Reform Act (OSRA)

Agricultural and transportation groups responded to the legislation:

International Fresh Produce Association – Robert Guenther, chief public policy officer – “The bipartisan Ocean Shipping Reform Act (S. 3580) provides much needed relief for our nation’s ports, in particular for the fresh produce industry that relies heavily on reliable, efficient ocean transport of fresh produce. … At a time of rising costs and high inflation, we applaud the passage of the Ocean Shipping Reform Act and relief it will ultimately bring to fresh produce consumers and businesses.”

American Farm Bureau Federation – Zippy Duvall, president – “Record-high shipping costs and shortages of containers have created bottlenecks at our ports and worsened supply chain issues at a time of growing demand domestically and overseas. Some estimates suggest we’ve lost out on more than $25 billion in agricultural exports. Limited trade has also made it more difficult to import supplies, which ultimately costs all Americans through higher prices.

Agriculture Transportation Coalition – Peter Friedmann, executive director – “This purpose of OSRA reflects the founding principle of the Agriculture Transportation Coalition, shared by all of U.S. agriculture: There is virtually nothing in U.S. agriculture and forest products grown or produced in this country that cannot be sourced or substituted with products from elsewhere in the world. If we cannot deliver affordably and dependably, our foreign customers can, and have proven they will, shift their purchases to those other countries, sometimes permanently.”

Association of Equipment Manufacturers – Kip Eideberg, senior vice president of government and industry relations – “This issue is not limited to just our industry; sectors across the American economy are negatively impacted. The Ocean Shipping Reform Act will help address the backlog of export delays by increasing the available number of containers for U.S. exports and create better transparency in ocean freight practices.”