The U.S. Trade Representative (USTR) has unveiled a revised maritime trade strategy aimed at curbing China’s dominance in global shipping while promoting American shipbuilding. The final plan, softened from its original proposals, introduces a tiered fee structure on Chinese-built ships and operators, alongside incentives for purchasing U.S.-built vessels.
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“Shipping is fundamental to America’s economic security and the flow of global commerce,” said Ambassador Jamieson Greer, U.S. Trade Representative. “This plan addresses supply chain risks and creates new demand for U.S.-built ships.”
The move follows a year-long Section 301 investigation into China’s maritime practices, spurred by a petition from five national labor unions.
Phase 1: Targeted Fees With Industry Flexibility
The policy rollout begins with a 180-day grace period before fees take effect. Once active, Chinese vessel operators will pay $50 per net ton of vessel capacity per U.S. voyage, with rates increasing annually to $140 by 2028. The fee applies at the first port of entry per rotation and is capped at five charges per vessel annually.
To maintain fairness, non-Chinese operators using Chinese-built ships will also face fees, though at a reduced rate—starting at $18 per net ton or $120 per container, whichever is greater. These will also rise incrementally through 2028.
Initially proposed penalties tied to fleet composition or future orders of Chinese-built vessels were dropped after pushback from exporters and logistics firms.
Additionally, a separate fee targeting foreign-built vehicle carriers will be introduced, based on Car Equivalent Unit (CEU) capacity, starting at $150 per CEU after the grace period.
Exemptions and Fee Caps Ease Concerns
To reduce disruption, exemptions have been included for U.S.-owned vessels, ships enrolled in federal maritime programs, smaller vessels, short sea trades, and ships in ballast. Fees will only apply at the first U.S. port call per rotation, not at every port.
Importantly, controversial flat-rate port entry fees of up to $1.5 million and proposed penalties for ordering Chinese vessels were scrapped.
Phase 2: LNG Shipping Requirements Favor U.S. Shipyards
Beginning April 17, 2028, a second phase will require a portion of U.S. LNG exports to be carried on U.S.-built ships. Recognizing the limited domestic capacity for LNG carrier construction, the mandate will phase in over 22 years to allow time for industry adaptation.
The final plan also introduces a fee remission program. Companies that commit to ordering U.S.-built ships of equal or greater size may suspend service fee payments for up to three years. While this incentive aims to boost domestic shipbuilding, experts warn that U.S. yards currently lack the scale to meet large vessel demand.
Proposed Tariffs on Chinese-Made Port Cranes
To safeguard critical port infrastructure, USTR has proposed tariffs of up to 100% on ship-to-shore cranes made in China or by Chinese-influenced firms. Investigators found that China dominates global production of these cranes, potentially compromising port security.
The USTR’s decision reflects growing bipartisan concern over China’s state-backed maritime expansion. The investigation concluded that China’s practices limit competition, crowd out market-driven players, and increase dependency across global supply chains.