US traders who import toys and other goods from Hong Kong and the mainland are being hit with up to a 47 per cent rise in freight charges because of a change in United States laws affecting the price of shipping.
The Ocean Shipping Reform Act, which went into effect on May 1, partly deregulates the steamship industry, whose rates had been set by cargo lines since 1916.
In the past, shippers had to make their prices public and charge all their customers the same rate, which meant that small importers could benefit from rates negotiated by big companies such as Nike and Mattel.
Now carriers can set whatever rates they want.
Charles Woo, who imports toys from Hong Kong to Los Angeles for his Megatoys company, said: 'Maybe in the long term the law will be a good thing, but obviously the cost of business is going up for us.' Importers say they will have to bear the cost of the increases, because the market will not allow them to raise prices.
David Reed, vice-president of Casio PhoneMate (PhoneMate), which imports hundreds of containerloads of goods each year, said: 'It is a lot more bucks all at once, but we are in no position to raise prices.
