The US Ocean Shipping Reform Act (OSRA) that was passed in late 2021 is on its way to become a law soon. The need for this reform arose after in less than 2 years ocean freight charges increased dramatically, putting a huge burden on consumers and businesses and hurting both imports and exports. In the same time, ocean freight carriers reported record profits.
Some of the key points of the Reform Act are:
- requiring ocean carriers to prove that detention and demurrage charges comply with federal regulations
- requiring ocean carriers to prove that detention and demurrage charges are reasonable (shifting burden of proof from the invoiced party to the carrier)
- prohibiting ocean carriers to decline shipping opportunities without a good reason
- requiring ocean carriers to make quarterly reports to the Federal Maritime Commission
While all these new regulations are welcomed as a step forward to normalization there are critics as well. The Reform Act has not addressed the landside logjams which also add to the total import costs increase and impede the flow of containers and goods to and from the ports. Without this being fixed, only half of the problem will be successfully resolved.
We can only hope that the EU port authorities follow the example of the US and address the constantly declining port situation sooner than later.
Stay tuned, stay updated!