USTR Proposes Fees on Chinese Ships Entering U.S. Ports

[Requesting Member Feedback]

On Feb. 27, the Office of the U.S. Trade Representative (USTR) published a notice proposing new measures targeting China's growing dominance in the maritime, logistics, and shipbuilding sectors. The proposal includes significant port entry fees on Chinese shipping companies and any Chinese-built vessels that enter U.S. ports. It also introduces new requirements for a portion of U.S. exports to be transported on U.S.-built and U.S.-flagged vessels.

Given the potential impact on shipping costs for importers and exporters, as well as overall supply chain operations, the Auto Care Association is gathering member feedback to assess how these measures may affect the automotive aftermarket industry.

We encourage members to provide insights on how these new policies could affect your operations, shipping costs, and supply chain efficiency. Your input will help shape our industry’s response in comments submitted to USTR.

USTR Notice

Background

In March 2024, five U.S. labor unions petitioned the U.S. Trade Representative (USTR) to investigate China’s policies and practices aimed at dominating the maritime, logistics, and shipbuilding industries. Following its Section 301 investigation, USTR determined that China’s actions have negatively impacted the U.S. shipbuilding industry and broader economic interests.

The investigation found that China’s government-driven strategies have pushed out foreign competitors, reduced opportunities for market-driven businesses and workers, and created dependencies that weaken supply chain resilience. These practices have made it more difficult for U.S. businesses to compete, discouraged investment in key industries, and increased economic risks by heightening reliance on China in critical sectors.

As a result, USTR concluded that China’s actions place an unreasonable burden on U.S. commerce and warrant a policy response.

Proposed Fees on Chinese-Linked Maritime Services

To counteract China’s market advantages, USTR proposes a fee structure applied to vessels entering U.S. ports. Any fees imposed would be cumulative and in addition to existing or proposed fees:

• Chinese Maritime Transport Operators: A fee of up to $1 million per vessel entry or $1,000 per net ton, whether or not the vessel was built in China.
• Operators Using Chinese-Built Vessels: A fee of up to $1.5 million per vessel entry or a sliding scale ranging from $500,000 to $1 million per vessel entry, based on the percentage of Chinese-built ships in their fleets.
• Operators with Pending Chinese Ship Orders: Additional fees between $500,000 and $1 million per vessel entry, based on the percentage of vessels ordered from Chinese shipyards for delivery within two years.

To incentivize the use of U.S.-built vessels, the proposal includes a refund of up to $1 million per entry for operators employing U.S.-built ships.

New Proposed Requirements on U.S. Exports

USTR also seeks to reduce U.S. reliance on Chinese shipping by gradually increasing the percentage of exports transported on U.S.-flagged and U.S.-built vessels:

• Effective Immediately: At least 1% of U.S. exports must be transported on U.S.-flagged vessels.
• After 2 Years: At least 3% of exports must be transported on U.S.-flagged vessels.
• After 3 Years: At least 5% of exports must be transported on U.S.-flagged vessels, with a minimum of 3% on U.S.-built vessels.
• After 7 Years: At least 15% of exports must be transported on U.S.-flagged vessels, with a minimum of 5% on U.S.-built vessels.

Timeline and Next Steps

• Feb. 21, 2025: Comment period opens.
• March 10, 2025: Deadline to submit requests to appear at the hearing.
• March 24, 2025: Deadline for written comments. Submit comments using the USTR Electronic Portal under docket USTR-2025-0002.