THE TRUMP ADMINISTRATION is proposing to “fight back” against China’s perceived maritime dominance by introducing new port fees and banning infrastructure ownership.

The office of the United States Trade Representative has completed a study, instigated under the Biden Administration and prompted by five US labour unions, into unfair foreign practices affecting US commerce, under Section 301 of the Trade Act of 1974.

USTR is now inviting comments from the public on proposed Section 301 actions “aimed to obtain the elimination of China’s acts, policies, and practices targeting the maritime, logistics, and shipbuilding sectors for dominance. In this Section 301 investigation, USTR has found China’s acts, policies, and practices to be unreasonable and to burden or restrict US commerce.

“To obtain the elimination of China’s acts, policies, and practices, and in light of China’s market power over global supply, pricing, and access in the maritime, logistics, and shipbuilding sectors, USTR proposes to impose certain fees and restrictions on international maritime transport services related to Chinese ship operators and Chinese-built ships, as well as to promote the transport of U.S. goods on U.S. vessels.” USTR said.

USTR is now seeking feedback on the following recommendations:

• Service Fee on Chinese Maritime Transport Operators: A vessel operator of China to be charged a fee on the international maritime transport being provided (a) at a rate of up to US$1,000,000 per entrance of any vessel of that operator to a U.S. port; or (b) per entrance of any vessel of that operator to a U.S. port, at a rate of up to $1,000 per net ton of the vessel’s capacity.

• Service Fee on Maritime Transport Operators with Fleets Comprised of Chinese-Built Vessels: Upon the entrance of a Chinese-built vessel to a U.S. port, a fee to be charged to that vessel’s operator on the international maritime transport provided via that vessel (a) at a rate of up to $1,500,000; (b) based on the percentage of Chinese-built vessels in that operator’s fleet: for operators with 50 percent or greater of their fleet comprised of Chinese-built vessels, the operator will be charged up to $1,000,000 per vessel entrance to a U.S. port; for operators with greater than 25 percent and less than 50 percent of their fleet comprised of Chinese-built vessels, the operator will be charged a fee up to $750,000 per vessel entrance to a U.S. port; for operators with greater than 0 percent and less than 25 percent of their fleet comprised of Chinese-built vessels, the operator will be charged a fee up to $500,000 per vessel entrance to a U.S. port; or (c) based on the percentage of Chinese-built vessels in an operator’s fleet: an additional fee of up to 8 $1,000,000 will be charged to a vessel operator per vessel entrance to a U.S. port if the number of Chinese-built vessels in the operator’s fleet is equal to or greater than 25 percent.

• Service Fee on Maritime Transport Operators with Prospective Orders for Chinese Vessels: An additional fee based on the percentage of vessels ordered from Chinese shipyards: (a) for operators with 50 percent or greater of their vessel orders in Chinese shipyards or vessels expected to be delivered by Chinese shipyards over the next 24 months, the operator will be charged up to $1,000,000 per vessel entrance to a U.S. port; for operators with greater than 25 percent and less than 50 percent of their vessel orders in Chinese shipyards or expected to be delivered by Chinese shipyards over the next 24 months, the operator will be charged up to $750,000 per vessel entrance to a U.S. port; for operators with greater than 0 percent and less than 25 percent of their vessel orders in Chinese shipyards or expected to be delivered by Chinese shipyards over the next 24 months, the operator will be charged up to $500,000 per vessel entrance to a U.S. port; or (b) a fee of up to $1,000,000 per vessel entrance to a U.S. port will be charged to a vessel operator if 25 percent or more of the total number of vessels ordered by that operator, or expected to be delivered to that operator, are ordered or expected to be delivered by Chinese shipyards over the next 24 months.

There are further recommendations to assist the US maritime sector, including that 1% of all shipments to/from the USA be carried in US-flagged tonnage; and under a Presidential Executive Order issued last week (America First Investment Policy) Chinese investment in/ownership of terminals and other port and critical infrastructure will be banned.

Inadvertently highlighting the possible burden MSC, top carrier in US trades, has just confirmed a new order for up to eight 21,700 TEU ships at Zhoushan Changhong International Shipyard, which follows 32 containerships of various sizes ordered by the Swiss/Italian carrier at the same yard over the past three years.

Analysts report MSC’s total orderbook now sits at 2.06 million TEU, which exceeds ONE’s total fleet!  Virtually all MSC’s newbuildings are at Chinese yards.