US eases some penalties tied to foreign-built ships, toughens others

The United States Trade Representative's office said on Friday it would modify certain maritime-related fees for foreign-built vehicle carriers and liquefied natural gas vessels ahead of port fees on China-linked ships slated to go into effect next week.

AI Brief

USTR reduced proposed fees on foreign-built ship operators but added exemptions for certain carriers.
New tariffs target Chinese cranes and cargo equipment to support US shipbuilding and counter China's dominance.
China retaliated with levies on US-linked ships, escalating maritime trade tensions.

USTR said in a statement that fees on operators of foreign-built vehicle carriers would be $46 per net ton, effective on October 14. That is below a fee of $150 per net ton originally proposed in April, seen by the industry as prohibitive, but well above an adjusted fee of $14 per net ton proposed on June 12.

USTR also is eliminating, retroactive to April 17, a provision permitting the suspension of liquefied natural gas (LNG) export licenses if certain restrictions on the use of foreign-built vessels were not met. And it added a carve-out from fees for certain ethane and liquefied petroleum gas (LPG) carriers under long-term charter arrangements.

USTR in February proposed the actions to counter China's rising maritime dominance and to restore American shipbuilding. But its original proposals were largely watered down amid pressure from industry, which called them overly punitive and said they would have stifled a U.S. shipbuilding revival.

The move came on the same day as Beijing retaliated against U.S. port fees taking effect on Wednesday for China-built, owned or operated vessels. China said it would impose levies on calls by ships built or flagged in the United States, or owned by companies with at least 25% of their shares or board seats held by U.S. investment funds.

CRANE, CARGO EQUIPMENT TARIFFS

USTR also said it would impose 100% tariffs on certain ship-to-shore cranes from China and some cargo-handling equipment, including intermodal chassis for trucks hauling containers. The agency reaffirmed it would not impose tariffs on ship-to-shore cranes ordered before April 17.

USTR said it has decided not to impose duties on intermodal shipping containers due to the potential impact on domestic carriers.

USTR also proposed further modifications to its action taken in April, imposing additional tariffs of up to 150% on certain cargo-handling equipment, including rubber-tire gantry cranes, and components of such equipment.