Inside Supply Management Magazine

September/October 2022

Point to Point

September 13, 2022

Logistics

Ocean Shipping Reform Act

Definition: Signed into law by President Joe Biden in June, the Ocean Shipping Reform Act (OSRA), according to the summary by the Congressional Research Service, “revises requirements governing ocean shipping to increase the authority of the Federal Maritime Commission (FMC) to promote the growth and development of U.S. exports through an ocean transportation system that is competitive, efficient, and economical.”

Field guide: For years, but especially during the coronavirus pandemic, U.S. exporters have claimed discrimination from international ocean carriers toward American-origin cargo regarding rate practices, equipment availability and demurrage and detention charges. OSRA requires the FMC to investigate and potentially order refunds for unwarranted charges — in effect, shifting the burden of proof to carriers in such disputes — and prohibits ocean carriers from unreasonably refusing available cargo space.

Factoid: OSRA “will bring benefits to shippers (over the) long term,” said Brian Whitlock, senior director analyst with the supply chain practice at Gartner,  the Stamford, Connecticut-based global business research and advisory firm. However, he added in a press release, “it will not have any effect — today or  in the future — on the market challenges logistics  leaders face, including port congestion and high  shipping rates.”