CalChamber Backs Extending Suspension of China-Built Vessel Fees

Last week the California Chamber of Commerce joined 250 trade associations in urging the Office of the U.S. Trade Representative (USTR) to support extending for two months the suspension of the fee on China-built vessels.

The trade associations included importers, exporters, retailers, manufacturers, agriculture groups, logistics providers, and other users of the international freight transportation system. Their call for suspending the Section 301 China-built vessel fees came in an Oct. 30 letter to the USTR.

The fee suspension was part of the Sept. 23 “Busan Agreement” trade truce, which had been scheduled to expire Nov. 10 and now is due to expire on Jan. 10, 2027. The overall extension was announced as Chinese President Xi Jinping met with President Donald Trump in Washington, D.C. in September 2026.

But the USTR still needed to issue an official Federal Register notice, which is required to legally bind the fee postponement. The letter from the trade associations is part of this process, which closes on Nov. 10.

The associations expect there will be a need to extend the fee suspension again before it ends in January.

Association Letter

In the letter, the associations express appreciation for the USTR’s efforts to address longstanding concerns about unfair practices affecting the maritime, logistics, and shipbuilding sectors. Strengthening U.S. maritime capacity and resilience is an important national objective.

At the same time, the letter notes, imposing new or resumed fees on China-built or China-linked vessels would create immediate and far-reaching consequences for U.S. companies that rely on ocean transportation to move goods into and out of the United States.

Resuming the Section 301 vessel fees in January 2027 would add another cost layer to an already-strained transportation, the letter asserts.

Background

In spring 2024, at the request of the United Steelworkers and four other unions, the USTR opened an investigation under Section 301 of the Trade Act of 1974, as a way to rebuild the U.S. shipbuilding industry.

A January 2025 USTR 182-page report detailed the decline of U.S. shipbuilding and U.S. flag carriers, and highlighted the dramatic expansion of China’s shipbuilding and ship operating sectors due to massive subsidies and preferential treatment.

Proposed remedies included significant “port service fees” against China-built ships every time they enter a U.S. port. The fee also would have applied to operators with China-built vessels in their fleet or having China-built vessels on order. The remedy further included a requirement for U.S. exporters to export a certain percentage of goods on vessels owned, operated and eventually built in the United States.

The proposed remedies would have resulted in fees ranging from $1 million to $3 million — even as high as $3.5 million per port call. Reactions were mixed: Unions and steel makers were supportive of the remedies, while carriers, shippers and farm exporters were strongly opposed.

A March 2025 study assessing the probable net economic effects of the proposed remedies found that overall, total exports and imports would decline, which would have a negative impact on the U.S. economy while the administration is trying to grow the overall economy and create jobs around the country.

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.

Originally the United States was to begin imposing new shipping fees in October 2025 that could have increased the cost of Chinese goods and potentially reduced imports. The Trump administration then agreed to pause the fees for a one-year period that would have ended Nov.10, 2026 before the latest extension to Jan. 10, 2027.