H.R.666 - Noncontiguous Shipping Reasonable Rate Act of 2024 (119th Congress)
Summary
H.R. 666, the Noncontiguous Shipping Reasonable Rate Act of 2024, seeks to define a 'reasonable rate' for ocean trade to noncontiguous areas like Hawaii, Alaska, and U.S. territories. The bill amends Section 13701(d) of title 49, United States Code, to establish that a reasonable rate is one within 10% of a comparable international ocean rate index recognized by the Federal Maritime Commission. The bill was introduced in the House of Representatives on January 23, 2025, and referred to the Committee on Transportation and Infrastructure.
Expected Effects
The primary effect of this bill, if enacted, would be to cap shipping rates to noncontiguous areas of the U.S. by providing a clear definition of what constitutes a 'reasonable rate'. This could lead to more predictable and potentially lower shipping costs for businesses and consumers in these regions.
Potential Benefits
- Reduced Shipping Costs: Consumers and businesses in noncontiguous areas may experience lower shipping costs.
- Increased Predictability: A defined 'reasonable rate' provides more predictability in shipping expenses.
- Fairer Trade Practices: Prevents excessive rate gouging by shipping companies.
- Economic Boost: Lower costs could stimulate economic activity in affected regions.
- Level Playing Field: Aims to align domestic shipping rates with international standards.
Potential Disadvantages
- Potential for unintended consequences: Capping rates could disincentivize shipping companies from serving these areas, leading to reduced service.
- Complexity in implementation: Defining and monitoring a 'comparable international ocean rate index' could be challenging.
- Possible legal challenges: Shipping companies might challenge the rate definition in court.
- Limited flexibility: A fixed percentage may not account for unique circumstances or market fluctuations.
- Administrative burden: The Federal Maritime Commission would need to actively monitor and enforce the new rate definition.
Constitutional Alignment
The bill falls under Congress's power to regulate commerce among the several states, as outlined in Article I, Section 8, Clause 3 (the Commerce Clause). It aims to ensure fair trade practices and prevent unreasonable pricing in shipping to noncontiguous areas. There are no apparent conflicts with other constitutional provisions.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).