In six months, the United States will be increasing fees on Chinese ships based on vessel capacity, as part of the Trump administration’s bid to revive the domestic maritime and shipbuilding industries.
The Office of the U.S. Trade Representative (USTR) released a plan on April 17 outlining its targeted actions, which followed a year-long investigation.
According to the USTR Fact Sheet, these actions will occur in two phases over a period of time to allow businesses to adjust. For the first 180 days, applicable fees will be set at zero.
First Phase
The first phase actions, after 180 days, will consist of:
• Fees on vessel owners and operators of China based on net tonnage (NT) per U.S. voyage, increasing incrementally over the following years. The fee would start at $50/NT in 180 days and increase by $30/NT per year over the next three years;
• Fees on operators of Chinese-built ships based on net tonnage or containers, increasing incrementally over the following years. The fee would start at $18/NT or $120 per container in 180 days, and would increase by $5/NT per year, or the same proportional yearly amount per container (e.g., in year 2, to $154 per container), over the next three years; and
• To incentivize U.S.-built car carrier vessels, fees on foreign-built car carrier vessels based on their capacity. The fee would start at $150 per Car Equivalent Unit (CEU) capacity of the entering non-U.S.-built vessel in 180 days.
Second Phase
The second phase actions will not begin for three years:
• To incentivize U.S.-built liquified natural gas (LNG) vessels, limited restrictions on transporting LNG via foreign vessels. These restrictions will increase incrementally over 22 years.
Earlier Investigation
The USTR opened an investigation in April 2024 at the request of the United Steelworkers and four other unions, under Section 301 of the Trade Act of 1974, as a way to rebuild the U.S. shipbuilding industry.
The USTR released the results on January 16, 2025 in a 182-page report on the decline of U.S. shipbuilding and U.S. flag carriers, focusing on the dramatic expansion of China’s shipbuilding and ship operating sectors.
The report concluded China increased its share of global shipbuilding tonnage from 5% in 1999 to more than 50% in 2023 because of massive subsidies from the Chinese government and preferential treatment for China government-owned enterprises that are squeezing out private sector international competitors.
On February 27, 2025, Trump administration’s USTR issued a set of remedy recommendations that included port fees and export restrictions, some more extensive than that sought by the union petitioners, to penalize ocean carriers that use Chinese-built ships and to support the U.S. shipbuilding sector
However, a March 2025 study assessing the probable net economic effects of the proposed remedies found that overall, total exports and imports would decline, having a negative impact on the U.S. economy while the administration is striving to grow the overall economy and create jobs around the country.
The study prepared by Trade Partnership Worldwide, LLC, concluded that ocean carriers will respond to USTR’s fees by reducing service to many U.S. ports (creating bottlenecks at larger ports like Los Angeles/Long Beach) and potentially diverting cargo to ports in Canada and Mexico based upon customer demand. The carriers’ response will reduce ocean traffic at many smaller ports (such as Oakland), creating profound economic damage — including lost jobs — in communities where ports serve as vital economic hubs.
March 2025 Coalition Letter
On March 24, 2025 the California Chamber of Commerce joined more than 300 other organizations in urging the Office of the U.S. Trade Representative (USTR) to refrain from imposing proposed actions against China that will hurt U.S. businesses and consumers instead of deterring China’s broader maritime ambitions.
The March 24, 2025 letter to the USTR was signed by organizations representing a wide breadth of the nation’s economy, including importers, exporters, farmers and agribusinesses, retailers, manufacturers, energy providers, wholesalers, transportation and logistics providers, and other sectors.
The letter explained specifically how USTR’s February 27 proposed fees would increase shipping costs, container and non-containerized, leading to higher prices for U.S. consumers, and undermine the competitiveness of many U.S. exports — leading to a decline in export revenues and increasing the U.S. trade deficit, contrary to the Trump administration’s America First trade goals.
The coalition acknowledged that USTR was proposing export requirements to support a domestic shipbuilding industry and emphasized that all 300-plus organizations signing the letter share the goal of finding real remedies to address China’s dominance in the maritime industry, while also revitalizing the U.S. shipbuilding industry.
The coalition supports scrutiny of China’s efforts to dominate the maritime industry but argues that the USTR’s proposed actions would not deter China’s broader maritime ambitions and will instead directly hurt American businesses and consumers.
March Public Hearings
USTR held public hearings on March 24 and March 26 regarding proposed actions in the Section 301 investigation on China’s targeting of the maritime, logistics, and shipbuilding sectors for dominance.
There was a mix of support and opposition to the earlier proposed remedies. Unions and steel makers were supportive of the remedies, while carriers, shippers and farm exporters were strongly opposed. There were 400 comments submitted and more than 30 witnesses.
All agreed that China’s dominance of the shipping industry should be addressed as the United States has lost more than 70,000 jobs in the last few decades and now ranks 19th globally in shipbuilding. Further, while China builds more than 1,000 ocean vessels for commercial use per year, the United States produces fewer than 10.
Recent Reactions
Despite the April 17 actions being toned down from earlier proposals and the desire to strengthen U.S. shipbuilding and ports — in addition to improving the supply chain — the business and shipping communities continue to warn that fees will increase prices for shippers and consumers, harm exporters and could prompt possible legal challenges regarding U.S. authority to levy the fees.
More: Cranes and Cargo
In addition to the ship fees, USTR also announced the initiation of Section 301 investigations into ship-to-shore cranes (100% tariff) and cargo handling equipment (20%–100%). The cargo handling equipment includes containers, chassis and chassis parts. USTR will hold a hearing on these investigations on May 19.
Previously, the Biden administration had imposed a 25% tariff on Chinese manufacturers of cranes in response to concerns about U.S. port security and potential cybersecurity threats from Chinese-manufactured port equipment.
