United States: Innovation On The Waterfront – The Regulation Of Autonomous And Remotely Controlled Commercial Vessels

Innovation On The Waterfront – The Regulation Of Autonomous And Remotely Controlled Commercial Vessels¹

By Katie Smith Matison²

INTRODUCTION

The use of autonomous and remotely controlled vessels will certainly revolutionize the commercial shipping industry. Yet, regulatory and legal compliance will create challenges as autonomous and remotely controlled ships are routinely used in the context of commercial shipping and the global transportation of cargo. Several of the legal issues that may impact autonomous shipping are discussed below including (i) statutes and treaties for the common carriage of cargo; (ii) environmental concerns; (iii) marine insurance; (iv) regulations of commercial shipping; (v) liability to seafarers; and (vi) construction and design of commercial vessels. Accordingly, it is likely that the myriad of statutes, treaties, and regulations governing commercial shipping will be amended and that new legislation will be necessary to adapt to the exciting changes on the horizon.

I. Legal Considerations of the Commercial Shipping Industry.

A. The Critical Importance of the Shipping Industry in World Trade.

The shipping industry is an indispensable element of global trade. The United Nations Conference on Trade and Development ("UNCTAD") reports that 80% of all cargo in global trade by volume and 70% of all global cargo by value is transported by the shipping industry.³ In a 2018 review of maritime trade, UNCTAD referred to "maritime transport" as the "backbone of international trade and the global economy."⁴ The International Chamber of Shipping ("ICS") reports that approximately 11 billion tons of cargo are carried aboard commercial ships every year. The cargo transported across the world by commercial ships includes consumer goods as well as bulk cargo in vast quantities.⁵ Moreover, commercial shipping is an affordable mode of transport and the shipping industry has "sophisticated logistics chains."⁶ The World Economic Forum ("WEF") reports that over the past 20 years, the size and carrying capacity of many container ships has increased dramatically.⁷ Accordingly, maritime transport of cargo is integral to world trade.

B. Commercial Shipping and Cargo Carriage Is a Highly Regulated Industry.

All aspects of commercial shipping and common carriage of cargo in the United States are governed by statutes and federal regulations. For example, the rights and duties of shippers of cargo aboard common carriers who issue a bill of lading for international voyages either originating from or arriving in the United States are controlled by the Carriage of Goods by Sea Act ("COGSA"), 46 U.S.C. § 30701.⁸ COGSA is a codification of the International Convention for the Unification of Certain Rules relating to Bills of Lading, and Protocol of Signature known as the Hague Rules of 1924.⁹ All bills of lading issued by a common carrier are controlled by the Federal Bills of Lading Act, 49 U.S.C. §§ 80101 – 80116. The Shipping Act of 1984, 46 U.S.C. §§ 40101, et. seq., as amended by the Ocean Shipping Reform Act of 1998 ("OSRA") Pub. L. 105-258, 112 Stat. 1902, governs Vessel Owning Common Carriers ("VOCC"), Non-Vessel Owner Common Carriers ("NVOCC"), Shipper Associations, Ocean Transportation Intermediaries ("OTIs"), and publication and filing of ocean transportation rates. The Surface Transportation Board ("STB")¹⁰ has regulatory authority over water carriers in domestic trade. The Federal Maritime Commission ("FMC") is an independent agency that regulates terminal operators, ocean common carriers, as well as freight forwarders.¹¹

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Footnotes

1. This paper was presented at the Transportation Lawyers Association meeting in Williamsburg, Virginia on May 12, 2022, and is republished here with the gracious approval of the Transportation Lawyers Association.

2. Katie Smith Matison is a shareholder in the Seattle office of Lane Powell PC, where she is the chair of the firm's Transportation Practice. She served as President of the Association of Transportation Law Professionals from 2012 – 2013, and currently serves as the Chair of the Publication Committee. Katie was awarded a J.D. and LL.M. in Admiralty, with distinction, from Tulane University School of Law in New Orleans, Louisiana.

3. UNCTAD, Review of Maritime Transport, https://unctad.org/webflyer/review-maritimetransport-2018  (last visited Dec. 20, 2022).

4. Id.

5. ICS, "Shipping and world trade: driving prosperity," https://www.ics-shipping.org/shippingfact/shipping-and-world-trade-driving-prosperity/  (last visited Dec. 20, 2022).

6. Id.

7. WEF, "Our economy relies on shipping containers. This is what happens when they're 'stuck in the mud'," (Oct. 1, 2021, https://www.weforum.org/agenda/2021/10/global-shortagofshipping-containers/ . In fact, the WEF reports some the largest sailing ships today have a carrying capacity of 24,000 containers. WEF states that $14 Trillion of cargo in global trade has been transported by containers. 

8. COGSA was previously codified in 46 U.S.C. §§ 1300 – 1315. 

9. The Hague Rules were amended in 1931, 1977, and 1982 and now are referenced as the Hague-Visby Rules. The United Nations International Convention on the Carriage of Goods by Sea Act adopted in Hamburg in 1978 resulted in the Hamburg Rules which became effective on November 1, 1992. The United Nations Conference on Trade and Development ("UNCITRAL") promulgated the Convention on Contracts for the Carriage of Goods Wholly or Partly by Sea in 2008 for the purpose of synthesizing laws of maritime nations in international trade. The Rotterdam Rules are not yet in effect.

10. STB, https://www.stb.gov/  (last visited Dec. 20, 2022). 

11. FMC, https://www.fmc.gov/about-the-fmc/  (last visited Dec. 20, 2022). The stated mission of the FMC is to "ensure a competitive and reliable international ocean transportation supply system that supports the U.S. economy and protects the public from unfair and deceptive practices." 

Originally Published by JOURNAL OF TRANSPORTATION LAW, LOGISTICS & POLICY

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