Beneficial cargo owners and logistics providers are looking to the US Congress for legislation to improve supply chain issues.

There has been movement on detention and demurrage charges, but major topics remain in limbo as long as it is unclear which government agency is in charge.

Congress is chewing on a raft of bills introduced by the House Committee on Transportation and Infrastructure that aim to strengthen US supply chains and protect them from disruption. Proposals before the House of Representatives comprise 12 pieces of legislation and five additional measures.

Among these is a bill to allow the Federal Maritime Commission (FMC) to “review market manipulation and anti-competitive issues”, the extension of the One Federal Decision framework for environmental reviews to major ports, aviation and pipeline projects, the allocation of federal priority consideration to projects to improve supply chain resilience under the INFRA and MEGA grant programmes and a mandate for the Federal Motor Carrier Safety Administration to develop a new safety fitness determination process for the rating of motor carriers.

What is not included, after calls from beneficial cargo owners, is an extension of the FMC’s powers. BCOs want the FMC to be authorised to deal with storage fees for intermodal shipments beyond ports. Specifically, this targets demurrage charges billed by rail carriers on intermodal shipments. There is no authority they can approach to challenge these fees and cannot go through federal rail regulators due to an intermodal exemption.

The National Shipper Advisory Committee and National Industrial Transportation League have proposed extending the demurrage rule-making under last year’s Ocean Shipping Reform Act (OSRA) to cover land storage of containers. They argue that in the absence of a definitive regulatory body, rail demurrage charges could be set at any level by carriers.

The railways have pushed back against this, arguing it would disincentivise ocean carriers from offering through-bills. They have been under pressure from the Surface Transportation Board to give clear explanations of their detention and demurrage charges, to which they responded arguing that the agency would be overreaching its purview.

OSRA has brought tangible benefits in regard to ocean carrier charges, noted Bob Imbriani, EVP international of forwarder Team Worldwide. Since its introduction, the FMC has imposed fines on several ocean carriers, including ONE and Wan Hai, which the lines have agreed to pay. In addition, several carriers have announced they would stop charging for dwell time at terminals when they are closed.

Still, there is no restitution for cargo owners that had to pay the charges imposed by carriers in the first place, Mr Imbriani noted.

And he would like to see similar regulatory developments for air cargo. He says air cargo terminals in the US have changed their policy to the detriment of cargo owners. In the past, they would not count storage time on weekends if cargo arrived on Friday afternoons, but now the clock starts ticking right away.

Mr Imbriani views the package of legislative proposals now before Congress as “promising”, but said a lot of the details have not yet been made public, so it is difficult to gauge their full merit. Moreover, it remains to be seen how the bills fare on Capitol Hill – although the fact they have bipartisan support from the house committee is encouraging.

Comment on this article

You must be logged in to post a comment.