OSRA passes, Biden signs

Now that the Ocean Shipping Reform Act has passed, the FMC will be taking a closer look at the carrier practices that impact shippers. During the Pandemic, the disruption that hit the supply chain has driven the market into inflation with shipping costs climbing higher than sustainable. President Biden signed the bill on June 16 after it sped through Congress with bipartisan support.

The bill will help the FMC investigate carriers on various issues. One issue will be the act of refusing loaded export containers in favor of empties they can speed back overseas to be loaded and instantly turned – a practice that has caused goods to sit and pile up while the equipment imbalances get worse around the world.

Another issue we’re seeing is the application of fees as a penalty instead of an incentive – especially when the fees are applied toward containers that can’t be picked up, returned, or moved due to problems from the carrier itself. One of the issues they’re most critically trying to fight is the carrier’s habit of not taking responsibility for a lack of appointments or opportunities for shippers to comply with the requirements.

Ocean carriers will also be providing a detailed quarterly inventory of their loaded exports, loaded imports and empty export boxes to the FMC so the trends can be investigated and future issues bypassed from the knowledge gained in the reports.

Support from the National Retail Federation and the general public shows the disparity we’re seeing in how much help the ocean shipment needs to get the industry ironed out. Inflation has directly followed the shipping costs that erupted with the onset of the pandemic.

Nelson International is keeping an eye on this and will have more updates as to how the OSRA will impact ports later in the month. If you have any questions as to how this will impact your ocean cargo, contact your Nelson representative for more guidance.