On April 15, 2025, shipping containers were seen stacked on a cargo ship as they were offloaded at PortMiami in Miami, Florida, a hub for international trade.

In a significant move that reflects ongoing tensions between the United States and China, the Biden administration has proposed a policy that will permit the U.S. government to impose steep levies on ships made in China upon their arrival at U.S. ports. This initiative, which started under President Biden and culminated in a January report, concluded that China's shipbuilding industry operates with unfair advantages that compromise U.S. economic interests.

As part of this policy, the original proposal suggested a service fee of up to $1 million for each vessel operated by Chinese companies, such as the well-known shipping giant Cosco. Additionally, for non-Chinese-owned ocean carriers that operate fleets containing Chinese-manufactured ships, the proposed service charge could reach as high as $1.5 million for each port of call in the United States. However, U.S. Trade Representative (USTR) Jamieson Greer clarified that these fees will only be applicable once per voyage, a departure from the initial proposal, which considered charging at each port.

Greer emphasized the critical nature of shipping to American economic security, noting that "ships and shipping are vital to American economic security and the free flow of commerce." He further described the Trump administration's actions as necessary steps to reverse China's growing dominance in the maritime sector, addressing threats to the U.S. supply chain and encouraging demand for ships built in the United States.

The announcement of these fees comes on the heels of a comprehensive investigation led by the USTR, which examined the practices and policies of China that they found to be unreasonable and detrimental to U.S. commerce. This investigation included testimony from over 300 trade groups and stakeholders during hearings held in March, where many voiced concerns that the U.S. was ill-equipped to engage in an economic battle that would place American carriers at a disadvantage.

In fact, projections indicate that vessels constructed in China could soon dominate the global shipping fleet, comprising as much as 98% of the trade ships on the seas. The new policy intends to curb this trend by imposing fees on Chinese-built vessels while incentivizing U.S. ship manufacturing.

Under the terms of this policy, vessel owners may qualify for a remission of the imposed fees if they can demonstrate that they have placed orders for U.S.-built ships. The fee remission will be contingent upon the net tonnage capacity being equal to or less than the ordered U.S. vessel. Notably, if a vessel owner fails to take delivery of the ordered U.S.-built ship within three years, the original fees will then become immediately applicable, as outlined in the report.

The fee schedule is structured in phases, with initial levies set to begin on April 17, 2025. During the first 180 days, fees will be temporarily set to zero for Chinese vessel operators. Following this grace period, the fees will incrementally increase over the next several years, reaching as high as $140 per net ton by April 2028.

Moreover, the fees for vessel operators of Chinese-built ships will also see a gradual increase, with initial rates starting at zero and escalating to as much as $33 per net ton by the same date. Importantly, these fees will be applicable up to five times per year per vessel.

In addition to these measures, the USTR has outlined plans for future phases of the policy, which will target Liquefied Natural Gas (LNG) vessels and include restrictions that will be applied incrementally over a period of 22 years. However, the new fees will not extend to shipping within the Great Lakes or the Caribbean, nor will they apply to bulk exports such as coal or grain, or empty ships arriving at U.S. ports.