IANA tracks important legislative and regulatory issues that affect the intermodal freight transportation industry. The status of these issues will be added as needed.
Shipping Reform Legislation Passes the House
The Ocean Shipping Reform Act of 2021 passed the House on December 8 by a bipartisan 364-60 vote. The legislation authorizes appropriations for the Federal Maritime Commission for FY22 and FY23 and proposes several changes to the Shipping Act. The bill would be the first major update to the FMC’s authority to regulate the global ocean shipping industry since 1998.
Among other provisions, the Ocean Shipping Reform Act of 2021 would: establish reciprocal trade to promote U.S. exports as part of FMC’s mission; require ocean carriers to adhere to minimum service standards; require ocean carriers or marine terminal operators to certify that detention and demurrage charges comply with federal regulations or face penalties; and shift the burden of proof regarding the reasonableness of detention or demurrage charges from the invoiced party to the ocean carrier. The bill also instructs the FMC to initiate a rulemaking prohibiting ocean carriers from unreasonably declining export cargo bookings if the cargo can be loaded in a safe and timely manner, unreasonably reducing shipper accessibility to equipment, or failing to furnish containers or other equipment needed to perform transportation services. Additionally, the bill allows the FMC to self-initiate investigations of ocean common carriers’ business practices and apply the necessary enforcement measures as well as order refunds in addition to, or in place of, civil penalties.
The bill directs the FMC to report to Congress on factors exacerbating the United States’ trade imbalance with foreign exporting countries, such as nonreciprocal trade practices and anti-competitive business practices. Furthermore, the legislation instructs the FMC to examine foreign state control or undue influence over ocean carriers’ business practices and publicly disclose all findings of false certifications for demurrage and detention charges and any resulting penalties imposed.
Moreover, the Ocean Shipping Reform Act of 2021 would authorize the FMC to issue an emergency order requiring ocean carriers or marine terminal operators to share information relating to cargo throughput and availability directly with relevant shippers, rail carriers, or motor carriers. The bill also requires ocean common carriers to report to the FMC data on total import and export tonnage and TEUs per vessel. Finally, the bill commissions a study to examine data constraints and their impact on the flow of cargo, which would produce recommendations to streamline information sharing domestically, identify bottlenecks, assess how data is stored and disseminated at U.S. ports, and analyze overall access to commercial data.
The legislation, sponsored by Reps. Garamendi (D-CA) and Johnson (R-SD), has been sent to the Senate and is pending further action.
Commerce Committee Examines Disruptions in Ocean Shipping Supply Chains
On December 7, the Senate Committee on Commerce, Science, and Transportation Subcommittee on Surface Transportation, Maritime, Freight, and Ports held a hearing titled, “Uncharted Waters: Challenges Posed by Ocean Shipping Supply Chains.” Witnesses included: John Butler, CEO of the World Shipping Council; Greg Regan, President of the Transportation Trades Department at AFL-CIO; Paul Doyle, CEO of Coastal Automotive; and Norman Krug, CEO of Preferred Popcorn.
During the hearing, members and witnesses discussed legislation to address delays and congestion in the supply chain caused by the COVID-19 pandemic, including Sen. Lee’s (R-UT) STOP the GRINCH Act and Ranking Member Wicker’s (R-MS) FREIGHT Act.
Members also spoke about converting inland facilities into pop-up container yards and the use of inland ports to alleviate congestion and bottlenecks along the coasts. Sen. Warnock (D-GA) and Mr. Regan praised the Biden-Harris Administration for providing the Georgia Port Authority flexibility to use previously allocated grant funding to create a pop-up facility at the Port of Savannah.
Additionally, Chair Peters (D-MI) and Sens. Baldwin (D-WI) and Klobuchar (D-MN) questioned the witnesses about bolstering domestic manufacturing to prevent future supply chain disruptions. Mr. Doyle and Mr. Regan recommended creating secondary sources of supply in the United States, asserting that reliance on foreign containers, chassis, and trailers has made the U.S. more susceptible to the current supply chain crisis.
Furthermore, several members and witnesses expressed concerns about claims of a workforce shortage in the trucking and rail industries. Mr. Regan argued that there is not a workforce shortage, but rather a lack of quality jobs. He contended this is particularly prevalent in the trucking industry and exacerbated by driver classification issues. On the rail side, Mr. Regan noted, mid-career employees are leaving due to the threat of furloughs, pressure to complete inspections early, and safety concerns. Both he and Sen. Baldwin advocated for structural changes to the freight rail industry to provide the Surface Transportation Board with the tools and authority to ensure railroads are meeting common carrier obligations.
White House Announces Truck Action Plan to Support Trucking Workforce
On December 16, the Biden-Harris Administration announced its Truck Action Plan, an effort to support and expand the trucking workforce. This initiative is one component of the Administration’s Supply Chain Disruptions Task Force, which was established in June to address near-term supply chain bottlenecks. Under this plan, the Departments of Transportation and Labor will collaborate to accelerate the expansion of apprenticeship programs, address pandemic-driven delays in the commercial driver’s license process, improve the quality of training, and expand access to driving jobs for veterans and underrepresented communities.
Specifically, the Federal Motor Carrier Safety Administration will provide more than $30 million in funding to help states expedite CDLs and will send toolkits to all 50 states detailing specific actions that will expedite licensing. Additionally, FMCSA will track delays and communicate with all 50 governors about ways to reduce delays in issuing CDLs.
The Department of Labor will begin a 90-day challenge to accelerate the expansion of registered apprenticeships. Moreover, DOL will conduct veterans-focused outreach and recruitment to enable transitioning service members and veterans to obtain jobs in the trucking industry. DOL and VA will work to ensure veterans’ driving experience is recognized for those seeking a CDL and will build on existing programs for transitioning service members.
Furthermore, USDOT and DOL will launch the Driving Good Jobs initiative to support the trucking workforce. The two agencies will partner to engage with drivers, identify best practices to support job quality and driver retention, study issues such as truck driver pay and unpaid detention time, and recruit drivers from underrepresented communities. In addition, this program will establish a task force to investigate predatory truck leasing arrangements as well as identify longer-term actions, including administrative or regulatory changes, that will improve the quality of trucking jobs.
NSAC Discusses Data Sharing and Fees
On December 8, the Federal Maritime Commission’s National Shippers Advisory Committee held its second meeting since its formation in June 2021. The two primary topics of conversation were data sharing and visibility and freight surcharges, detention, and demurrage. Following the meeting, the NSAC will establish two subcommittees to focus on each of these issues. The subcommittees will be tasked with discussing these topics in more detail and providing recommendations to the full Committee. The NSAC will then hold a vote and provide formal recommendations to the FMC. Subsequently, the Committee may form additional subcommittees addressing: cargo discrimination; chassis; ports and port automation; carriers and contracts; rail and drayage; and items that fall outside the FMC’s scope.
When discussing data sharing, several members articulated the need for a standard set of definitions for the shipping industry. The Committee agreed there must be a unified, harmonized lexicon related to shipping terms. Additionally, Committee members offered several recommendations to improve visibility, including implementing vessel schedule delay notifications by ocean carriers, ensuring stable early return dates and last free days, and creating a national supply chain data portal for ports, terminals, truckers, railroads, and ocean carriers to submit data.
Furthermore, several members proposed changes to carriers’ billing practices. Specifically, Committee members expressed opposition to automated invoicing and recommended additional reviews of invoices and that carriers be held accountable for their billing practices through regulation or statute. NSAC members also pointed to the lack of reciprocity in the empty return process. A group of members agreed the FMC should mandate arrival notices and require greater transparency regarding charges. Finally, multiple members noted the Committee must consider ongoing and previous actions by the FMC, including Commissioner Bentzel’s recent data initiative, and incorporate them into the NSAC’s work.