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FMC Action Against Unfair Port Charges Sees Strong Support

Thursday, February 09, 2017
Sandler, Travis & Rosenberg Trade Report

More than a dozen companies and trade associations have indicated their support for a new Federal Maritime Commission rule or policy preventing marine terminal operators and ocean carriers from charging unfair demurrage and detention fees when uncontrollable incidents such as storms and strikes keep cargo from being picked up from ports on time. A coalition of 25 importers, exporters, freight forwarders, customs brokers, and third-party logistics providers submitted a petition to the FMC in December seeking such a rule.

Cargo owners and trucking companies are normally given a certain number of free days to pick up containers of imported goods from ports after they have been unloaded from ships. After that period they can be charged demurrage, a fee intended to ensure that containers are removed quickly and efficiently. In addition, detention and per diem fees can be charged if the containers and the chassis used to haul them are not returned within a specified time.

The coalition wants the FMC to require MTOs and carriers to extend free days during times of port congestion, weather-related events, port disruptions, delays caused by government actions, or other requirements beyond the control of the parties picking up or returning containers. Coalition members also want the FMC to declare demurrage and similar fees charged during such incidents to be unreasonable under the 1984 Shipping Act.

The customs brokers, ocean transportation intermediaries, and others who have submitted comments thus far have all been in favor of the FMC granting the petition and initiating a rulemaking as soon as possible. They have pointed out that the existing system of addressing unreasonable demurrage and detention fees, by “arguing with the carriers or ports” or “challenging the bills at the Commission,” is time consuming and unwieldy. Many commenters have emphasized that they are not requesting the addition of a new regulation but rather the enforcement of existing regulations holding the practices at issue to be unlawful.

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