Atlantic Container Line (ACL) has been caught in the crosshairs of the U.S. Trade Representative’s (USTR) new Section 301 charges, with its con-ro vessels now being classified as vehicle carriers rather than container ships resulting in multimillion-dollar tariff implications.
Unexpected Classification and Financial Impact
ACL’s 3,800 TEU con-ro vessels were initially expected to fall under the exemption threshold for USTR fees, which applies to container ships under 4,000 TEU. However, U.S. Customs and Border Protection (CBP) reclassified the vessels as vehicle carriers due to their 28,900 square metres of ro-ro decks, despite these accounting for only 20% of total cargo capacity.
The reclassification triggered significant financial consequences. According to CNBC, ACL paid $1.4 million in charges for a single ship call in the U.S. on October 14 the day the fees came into effect. With five vessels operating on weekly transatlantic services, each making up to five annual U.S. calls, ACL could face an estimated $34 million in annual tariffs.
Industry Concerns and Potential Market Impact
“That’s 25 vessels being charged $1.4 million a year,” Andrew Abbott, CEO of ACL, told CNBC. “We are looking at a tariff total of $34 million a year.”
“The vessel should be classified by the majority of freight we move. That’s containers. We have always been considered a container vessel. This time around, Customs and Border Protection changed it to ro-ro container.”
The dispute underscores the broader fallout from the latest round of Section 301 measures on Chinese-built vessels. As ACL explores options to challenge the classification, the case is likely to fuel ongoing debates over tariff policy and its unintended consequences for U.S.-bound trade.
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Source: Seatrade Maritime News
