Legislation to reform oversight of the shipping industry passed the U.S. House of Representatives in a broadly bipartisan effort Monday night, paving the way for President Biden to sign it into law. It revises the Shipping Act of 1984, strengthening the authority of the Federal Maritime Commission while responding to complaints from US retailers, importers, exporters, manufacturers and the agricultural industry about excessive fees and unfair trade practices.

The legislative effort began about a year ago, prompted by frequent and vocal complaints from shippers about excessive fees charged by carriers and terminals and barriers to exporting during the pandemic. California Rep. John Garamendi is credited with starting the process and building the coalition that led to broad support in the U.S. House of Representatives, helping the House version of the bill pass a strong bipartisan vote. last December. Senators Amy Klobuchar and John Thune led the effort in the US Senate, which passed his version in March. Today, the United States House voted to approve the Senate version and send it to the President for his signature.

As the efforts have grown from complaints about demurrage and detention charges, supporters have broadened the focus saying it will be a prescriptive measure to address broader issues including the inflation and uncontrollable shipping costs. President Biden unleashed a new round of criticism of carriers last week, citing up to 1,000% shipping cost increases during the pandemic. In a statement tonight applauding the passage of the bill, Biden also focused on efforts to improve exports, saying carriers would no longer be able to refuse U.S. goods leaving with empty containers at the square.

The House just passed the Ocean Shipping Reform Act and sent it to @POTUS‘ desk to sign into law. Inflation and supply chain relief is on the way! Thanks @SenAmyKlobuchar, @SenJohnThune& @RepDustyJohnson for partnering with me to achieve this! pic.twitter.com/Osy0Ap0Cwg

— John Garamendi (@RepGaramendi) June 13, 2022

“I commend Congress for passing the Ocean Shipping Reform Act on a bipartisan basis, which will help reduce costs for American retailers, farmers and consumers,” President Biden said, adding that he had look forward to enacting it.

The bill includes key provisions and authority for the CMF to deal with D&D fees. Carriers will bear the burden of proving the fairness of charges. The FMC also gets new power to launch investigations into carrier business practices, new enforcement power and oversight. Carriers have new reporting requirements for the number of import and export containers transported and are not allowed to unreasonably reduce their exports. The FMC is also gaining new authority over maritime trade and alliances that had been targeted by President Biden and other critics who argue the business has become too focused.

Stating that the bill provides needed and overdue updates to laws and will bring greater accountability to how ocean freight services are provided, FMC Chairman Daniel Maffei released a statement applauding the passage of the bill.

“The strong bipartisan and bicameral support of Congress to act and address the myriad of challenges that U.S. shippers, particularly exporters, have faced over the past two years is impressive,” Maffei said. “OSRA will provide the FMC with enhanced authority to ensure industry players have the right incentives and that all stakeholders in the ocean freight transportation system can have a voice.”

The bill also received broad support from retail, manufacturing, export and other trade groups. While the bill does not directly address skyrocketing contractual and ad hoc freight rates, it does tackle fees, and supporters say improving business practices and exports will help reduce costs and repair problems in the supply chain.

“Decisive policy action is essential to address supply chain challenges as the consumer packaged goods industry continues to face unprecedented production and shipping costs,” said Tom Madrecki, vice president of supply chain and logistics at the Consumer Brands Association, one of many groups. who defended this bill. “The pandemic and ensuing disruptions have highlighted the fragility of the complex supply chain system and the need to modernize decades-old ocean regulations to address declining shipping performance and practices. unfair practices that hurt American manufacturers, farmers and ultimately consumers. Consumer Brands welcomes final passage of the Ocean Shipping Reform Act, which updates existing law to combat rising shipping costs and provides the Federal Maritime Commission with additional powers to protect U.S. exporters and importers .

Representing carriers, the World Shipping Council had been highly critical of the efforts, but said it was eager to work with stakeholders to address concerns. They called the House’s version of the bill flawed, saying the effort did “nothing to address landside logistics issues that are at the heart of America’s supply chain problems.” The Senate version, which is now set to become law, said the WSC was “a more deliberative approach” but still failed to address the root causes of congestion on the city side of the United States. United.

Recognizing that the FMC will have an expanded role in the future of the shipping industry, Congress also voted to increase the commission’s budget by nearly 50% over the next four years. Maffei, who was recently reappointed to his post as head of the FMC, said in his statement that the commission will move quickly to implement the necessary measures to bring the benefits of the legislation to shippers, starting with the drafting rules for export shipments.