January 04, 2022

Law360 Quotes Ashley Craig on Supply Chain Snarls Continuing into 2022

2 min

On January 4, 2022, Ashley Craig was quoted in Law360 on supply chain snarls that arose during the COVID-19 pandemic continuing into 2022. According to the article, 2021 saw a surge in nonperformance complaints against ocean carriers by companies alleging that the firms were declining shipments in violation of their contracts. At the same time, shipping costs have spiked, with the cost to send goods across the Pacific from China to the United States tripling since the end of 2019.

Disputes and campaigning by U.S. trade and manufacturing groups spurred Congress to revisit U.S. shipping regulations for the first time since the 1990s. The Ocean Shipping Reform Act of 2021 passed the U.S. House of Representatives with broad bipartisan support last month and is currently before the Senate Committee on Commerce, Science, and Transportation.

The bill, which would expand the Federal Maritime Commission's oversight of ocean carriers and give importers a broader avenue to bring disputes against their shipping partners, has raised objections from the shipping industry, which has argued that the market will correct itself, and broad legislation is the wrong response to a short-term problem.

Neither the Senate — which took seven years to produce its last major shipping legislation — nor regulatory action by the commission is likely to present a quick fix for U.S. importers in 2022, Craig told Law360. "We're telling clients to use this time to try to, if possible, renegotiate with their carriers. Sit down; try to strike a balance. Look at your demands; look at what the carriers are offering and see if there might be a way forward," he said. "That's easier said than done, both from the carrier and the shipper side of that equation."

Click here to access the article.