China Restricts Entry of US Flag
Vessels in Ports in Retaliation of Port Fee on Chinese Vessels
Beijing’s countermeasures seen as
further complicating shipping routes connecting US and China, but the number of
affected vessels could be small
U.S. Port
Fee & China’s Retaliation
·
U.S. Action: A new port fee targeting
China-built or -operated vessels will take effect in two weeks.
·
China’s Response: Revised maritime transport
rules now permit retaliatory measures, including:
o
Special fees on foreign vessels at Chinese ports
o
Restrictions or bans on port access
o
Limits on access to China-related maritime data and
services
Legal
& Strategic Context
·
Basis for Retaliation: China's
revision responds to the U.S. Trade Representative’s Section 301 investigation
into China’s maritime sector.
·
Section 301: Investigates whether foreign
policies unfairly burden U.S. commerce.
Operational
Impact
·
Affected Routes: Transpacific shipping routes
face volatility; carriers are adjusting deployments.
·
Targeted Entities:
U.S.-flagged or U.S.-owned vessels, notably Matson (Hawaii-based), may be
impacted.
·
Matson’s Profile: Ranks 29th globally with 0.2%
of container capacity.
Market
Share & Definitions
·
Limited Direct Impact: U.S.
vessels represent a small share of global shipping capacity.
·
Potential Expansion: If
China applies broad definitions (e.g., U.S. financing, listing, or chartering),
many vessels could be affected.
·
Expert View: “The devil lies in the
details”—impact hinges on how China defines vessel origin.
Global
Shipping Landscape
·
Top Carriers: Dominated by Asian and European
firms; no U.S. companies in top 10.
·
Fleet Capacity:
o
U.S.-flagged: 0.6% of global deadweight
o
China + Hong Kong: 13.9%
o
Cosco (China): 3rd largest globally with 10.6%
container capacity
As
a new US port fee targeting China-built or -operated vessels is set to take effect
in two weeks, China has revised its international maritime transport rules to allow
retaliatory measures, including charging special fees or restricting access to Chinese
ports.
China
will implement necessary countermeasures against any country or region that imposes
or supports discriminatory bans, restrictions or similar measures targeting Chinese
operators, vessels or crews, according to the revision released on Monday.
“These
countermeasures include, but are not limited to, charging special fees on their
vessels when calling at Chinese ports, prohibiting or restricting these vessels’
port access in China, and barring or restricting their organisations or individuals
from accessing China-related maritime data or operating in international shipping
and related services to and from Chinese ports,” the revision said.
It
was approved by Premier Li Qiang and took effect immediately.
The
move could be regarded as a response to the Office of the US Trade Representative’s
Section 301 investigation into China’s maritime sector and would further complicate
shipping routes connecting the two countries, Guotai Junan
Futures said in a note on Tuesday. Section 301 investigations aim to determine whether
a foreign government’s policies or acts are discriminatory, and whether they burden
or restrict US commerce.
The
transpacific shipping route has seen considerable volatility this year, driven by
tit-for-tat tariff measures between the world’s two largest economies. Carriers
are also adjusting vessel deployments on the route to avoid or minimise exposure
to the coming US port fees.
Chinese
retaliation proposed in the revision could target US vessels, including those under
US flags or owned by US companies, mainly involving the Matson shipping company,
Haitong Futures shipping analyst Lei Yue said on Tuesday.
Headquartered
in Hawaii, Matson has been providing shipping services across the Pacific, including
routes from China to Southern California, according to its website.
The
company ranks No 29 among the world’s container carriers, with 0.2 per cent of the
world’s total box capacity, according to Alphaliner, a
liner-shipping-data platform.
The
impact of China’s retaliation could be limited due to the small number of affected
vessels, Lei added, noting the significant gap in shipping market share between
the two countries.
However,
if an all-encompassing definition is applied – such as ownership deemed to be held
by an American company through financing, listing on US exchanges, or chartering
by US entities – there could be a significant impact, Jayendu
Krishna, a director at Drewry Maritime Services, said on Tuesday.
“Several
American private equity [firms], banks and alternative finance companies have significant
interests in the ships,” he said. “It will be hard to fathom the impact without
knowing the exact definition of what is under purview.
“The devil lies in the details.”
Although
the revision did not specify how to determine a vessel’s nationality or origin –
such as by ownership or flag – the US accounts for only a minor share of shipping
capacity under either criterion.
Among
the top 10 container carriers, except for Israel’s Zim, the other nine are based
in Asia or Europe, with no US companies included.
State-owned
Chinese shipping giant Cosco holds the third-largest share of global container capacity,
with 10.6 per cent.
The
US-flagged fleet, including the merchant fleet, accounts for 0.6 per cent of global
deadweight tonnes, while vessels flagged in mainland China and Hong Kong combined
accounted for 13.9 per cent, according to the UN’s 2025 Review of Maritime Transport,
issued last week.