Shippers call for US Shipping Act revisions as continued congestion takes its toll
The National Industrial Transportation League (NITL), a U.S. trade association representing industrial freight shippers, is calling on Congress to overhaul the 1984 Shipping Act after months of “shipping troubles that have taken their toll on exporters and American importers â. Continued congestion at U.S. ports and disruption to the shipping network is costing shippers “billions of dollars in higher shipping costs, demurrage and retention charges, and lost business,” NITL said in a statement.
The challenges resulting from shippers’ limited access to containers and chassis and sufficient vessel reservations “have revealed loopholes in the law governing shipping services that warrant immediate action,” according to the association.
âNITL believes that the inability of exporters and importers to effectively address these business challenges means that the time has come to update the Shipping Act to reflect current circumstances,â said Lori Fellmer, Director of the Shipping Law. NITL and Chair of the Oceanic Committee.
A proposal drafted by NITL offers four main recommendations for amending the shipping law:
- Codify industry guidelines on demurrage and detention issued by the Federal Maritime Commission in 2020, and require service providers to prove their practices are reasonable and follow the rules in the event of a complaint
- Clarify the obligations of public carriers with regard to the allocation of equipment and vessel space and the execution of contracts, requiring them to meet minimum service standards and develop emergency service plans for cover periods of port congestion.
- Address unfair trade practices related to the access, allocation and exchange of materiel, and any unreasonable allocation of vessel space by ocean-going public carriers given the demand for import and predictable export.
- Expand the power of the CMF to act on complaints filed against anti-competitive agreements between shipping carriers that operate with antitrust immunity, such as alliances, and allow third party interveners to participate in legal proceedings initiated by the CMF against such agreements.
The World Shipping Council said the proposal was “unnecessary and unworkable” and attributed the disruptions in the shipping system to record demand for freight in the United States. âThere is no legislative policy that can change the systemic physical challenges caused by the Covid cargo crisis,â the organization said. He also said the proposed changes would turn the navigation law into a “government-run system that prevents private parties from managing their own business affairs.”
NITL Executive Director Jennifer Hedrick said in response: âWe hope our proposal encourages all stakeholders, including government officials, to work more aggressively and collaboratively to find viable, long-term solutions. Things cannot go on as they are for US importers and exporters. “
The revision of the law on navigation is under discussion in political circles. Federal Maritime Commission Chairman Daniel Maffei said last week during a webinar with the Port of Los Angeles that he had “spoken a lot to some of my former colleagues in Congress and some of them have asked. : ‘Well, could we change the shipping law? ? ‘And, of course, they can change the shipping law. And I’ll give them the best advice I can on how they would or if they should do it. “