The Office of the United States Trade Representative (USTR) announced proposed actions in response to China’s alleged targeting of the maritime, logistics, and shipbuilding sectors for global dominance, including the imposition of entry fees on Chinese ships calling at US ports.
This development follows the conclusion of a Section 301 investigation that found China's strategic practices to be unreasonable and restrictive to U.S. commerce.
The investigation, initiated in April 2024 after petitions by several prominent U.S. labor unions, including the United Steelworkers (USW), the International Brotherhood of Electrical Workers (IBEW), and others, revealed that China has aggressively targeted these key sectors through state-led industrial planning and economic interventions. According to the USTR, such practices have significantly disadvantaged U.S. businesses, limited market opportunities, and compromised supply chain resilience.
To address these concerns, the USTR has outlined potential trade actions, including imposing substantial fees on Chinese maritime operators, charging up to $1 million per vessel entry into U.S. ports. Additionally, operators with fleets comprising predominantly Chinese-built vessels, or those with significant pending orders from Chinese shipyards, could face fees ranging up to $1.5 million per entry.
As a vessel may call on several US ports each voyage, the proposed fees could be substantial. Industry participants estimate the impact to fall between $150 to $400 per TEU, depending on the vessel.
The proposal also includes incentives to bolster U.S. maritime capabilities by offering fee remissions for operators utilizing U.S.-built ships. Furthermore, restrictions are proposed to ensure that progressively higher percentages of U.S. goods exported by sea are carried by U.S.-flagged vessels, reaching up to 15 percent within seven years.
According to the US department of Transportation, only about 1.5% of U.S. waterborne imports and exports by tonnage are currently transported on U.S.-flagged vessels. The proportion of U.S. exports carried specifically on U.S.-built ships is even smaller, though exact figures are not readily available.
This limited use of U.S.-built ships for international trade is largely due to their higher construction costs—up to six to eight times more expensive than foreign-built ships—making them less competitive in the global shipping market.
The complex matrices of penalties and remissions, coupled with assumptions of domestic commercial shipbuilding capacity surging by an order of magnitude in seven years - supply chain, workforce and all, lead some observers to question whether the authors of the scheme have an understanding of the shipping industry.
"These suggestions are so complex that it's impractical, if not impossible, to administer," notes Per Starup Sennicksen, a Danish shipping and logistics consultant.
USTR will hold a public hearing on March 24, 2025, in Washington, D.C., to gather stakeholder input. Written comments are invited through March 24, and post-hearing rebuttals will be accepted for an additional seven days. The actions aim not only to mitigate current commercial burdens but also to counteract future economic security risks arising from China's dominance in these vital sectors.
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