Despite strong opposition from the industry, the Office of the United States Trade Representative (USTR), headed by Trump's trade representative, still plans to launch an investigation under Section 301 and crack down on China-dominated shipping, logistics, and shipbuilding industries. The new policy will be implemented in two phases, with charges calculated per voyage rather than per port, and a maximum of five charges per ship per year.

The first phase is expected to begin 180 days after implementation: service fees will be levied on Chinese ship operators and shipowners, starting at $50 per net ton as of October 14, increasing by $30 every six months. Non-Chinese but China-built ship operators will be charged $120 per container, with price increases every six months. Foreign-built car carriers will be charged $150 per CEU.

The second phase is planned to start three years later, aiming to restrict foreign ships transporting liquefied natural gas (LNG). These restrictions will gradually increase by 2022.

China is currently the world's largest shipbuilder, producing nearly 29% of the current active container ships and 70% of the ordered container ships by capacity. Additionally, China dominates in the production of containers and gantry cranes.

This policy will directly impact China's shipping and logistics giant Cosco, which is the world's largest shipping company by capacity. In addition, non-Chinese companies such as Denmark's A.P. Moller-Maersk and Switzerland's Mediterranean Shipping will also be affected since they have purchased numerous vessels from Chinese shipyards.

Compared to the initial proposal, USTR has made several adjustments, including:

1. Fee reduction mechanism: Shipowners who can provide proof of ordering US-built vessels will be eligible for a suspension of fees equivalent to their vessel's tonnage, up to a maximum of three years.

2. Specific shipping exemptions: Shipping within the Great Lakes and Caribbean regions, as well as voyages to and from US territories, will be exempt from charges.

3. Bulk commodity export exemptions: Ships transporting bulk commodities such as coal or grain, as well as empty ships arriving at US ports, will be exempt.

Original source: https://www.toutiao.com/article/1829739710923788/

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