USTR port fees to apply once per voyage, US vessel operators exempt, maritime sources say

The U.S. Trade Representative office on Thursday is expected to exempt U.S.-owned and registered vessels from port fees to be levied on China-linked vessels as part of President Donald Trump's effort to revive domestic shipbuilding and counter China's dominance on the high seas, two maritime industry sources told Reuters. 

The original USTR proposal to hit China-built ships with fees of up to $1.5 million per port call sent a chill through the global shipping industry.

Executives feared virtually every carrier could be hit with stacking fees. They said the extra costs would make U.S. export prices unattractive and foist billions of dollars in annual import costs on American consumers.

The fees will apply once per voyage, the sources said.

Implementation will begin in six months, they said. 

The decision comes on the one-year anniversary of the launch of USTR's investigation into China's maritime activities. In January, the agency concluded that China uses unfair policies and practices to dominate global shipping. 

The revision followed a tsunami of public and private opposition from the global maritime industry, including domestic port and vessel operators as well as U.S. exporters and importers of everything from coal and corn to bananas and concrete.

Industry executives had warned that U.S. taxpayers, workers and even the U.S. shipbuilders and owners the government aims to support could be harmed if the plan was adopted without adjustments.  

Container ship operators such as MSC and Maersk visit multiple ports during each sailing to the United States and executives warned the fees would quickly pile up.  

U.S. Trade Representative Jamieson Greer last week said the agency would not apply all aspects of its original fee proposal, which outlined a range of options to penalize China, including million-dollar port fees for ships with ties to the country. 

During a congressional hearing, Greer said the fees may not be cumulative and would be designed to avoid economic harm. Reuters reported separately that the administration was considering a variety of options to soften the port fee proposal after receiving feedback from industry representatives in private meetings or via hundreds of comments submitted online.

(Reporting by Lisa Baertlein in Los Angeles, Andrea Shalal in Washington and Jonathan Saul in London; Editing by Matthew Lewis, Kirsten Donovan and Rod Nickel)