U.S. lawmakers seek minimum service standards for shipping lines

OSRA 2021, as it’s called, represents an effort to update federal shipping laws and regulations that were last revised in 1998. Representative Johnson, with a background in utility regulation, has provided statistics on carrier concentration – where the top 10 carriers now control 80% of the volume, up from 12% in 1998, stating: “We are clearly in a different environment.

Biparty legislation has three main facets, as co-sponsor John Garamendi, Democratic Representative from California, explained. Congressman Garamendi explained the three main focal points of the bill:

  • Minimum requirements for service contracts “there can be no unreasonable refusal to transport cargo”
  • Improves enforcement “allows the Federal Maritime Commission itself to initiate investigations itself … puts in place anti-retaliation measures … and shifts the burden of proof to carriers” and increases transparency.
  • Creates a new, separate process for dealing with demurrage and detention complaints, more streamlined than currently, and allows the CMF to play a more active role in investigating these complaints.

A major catalyst for this effort has been the difficulty for US exporters to obtain “voids” because carriers have returned them directly to Asia, where outbound freight by box is at record levels once imports are offloaded. Johnson District is located at the heart of grain growing, with a significant meat processing industry, while Rep. Garamendi in California has a significant production of rice, nuts and other crops. He pointed out that the bill comes after urging voters; saying that local California producers “were screaming at each other over a year ago that they were just simply unable to get containers to ship their produce to the Western Pacific.”

After noting that investigations and discussions with freight shippers also confirmed similar problems in the upper Mississippi area, he added that “the control of shipping by two handfuls of carriers has eliminated the competition that had existed for many years. many years”.

Describing the push for updated regulations, Johnson said: “This is not an onerous mandate, it is a basic expectation of common carriers… it is a pretty standard rule of the road that if you are in this business, and you can reasonably take freight, that you do. He suggested that: “The unpredictability [in securing containers] is not healthy for the market… if you are going to be a common carrier, if you are going to use American ports, to be able to be part of the flow of trade, then you have to be able to accept very basic rules of the road… including not to unduly discriminate against US agricultural exports.

Liner shipping is indeed on the radar in Washington, DC The Biden administration mentioned shipping in an executive order in early July on promoting competition in several industries. In a briefing, the Holland & Knight law firm said: “The OE refers specifically to the consolidation in the shipping industry over the past two decades, suggesting that such consolidation could put US exporters at a disadvantage.

The US legislative situation can be unpredictable and chaotic, even in times of calm. At present, much attention is being given to the passage of a bill of over $ 1,000 billion on “infrastructure”, which is linked to other laws concerning expanded social programs.

Asked about the possibility of the proposed legislation being enacted, Garamendi, a shipping promoter well known for his role as a ranking member of the Coast Guard and Shipping Subcommittee, suggested that the facets of OSRA 2021 could be bundled with the next clearance for the Coast Guard – part of the Department of Homeland Security since 2003.

The full text of the legislation is available here.