FMC Seeks Comments on Establishing Demurrage and Detention Charge Billing Requirements

Transportation Update

Date: February 17, 2022

On February 4, the Federal Maritime Commission (FMC) approved an Advanced Notice of Proposed Rulemaking (ANPRM) seeking comments on whether it should propose a new rule governing demurrage and detention billing practices related to ocean transportation container shipments. The FMC noted that demurrage and detention charges have been increasing substantially and it is responding to shippers’ complaints that invoices for such charges lack sufficient clarity to enable the recipient to understand and verify the charges. Comments are due on March 17.

The ANPRM follows Commissioner Rebecca F. Dye’s recommendations in the FMC’s Fact-Finding Investigation No. 29 that the FMC consider whether it should require common carriers and marine terminal operators (MTOs) to include certain minimum information on or with demurrage and detention invoices and adhere to certain billing practices regarding the timing for issuing invoices. The ANPRM broadly defines the terms “demurrage and detention” to include any charges assessed by common carriers and MTOs related to the use of marine terminal space or shipping containers, respectively.

The ANPRM includes questions for interested parties to address in their comments, including, for example:

  • Should the FMC include vessel operating common carriers, non-vessel operating common carriers or MTOs in a proposed demurrage/detention billing requirement?
  • What types of information should be required on demurrage/detention bills?
  • What information/timeframes should be required for demurrage/detention bills?
    Should the billing party be required to identify the basis for why the invoiced party is liable for the charges?
  • Should the FMC require invoices to be issued within 60 days of the date when detention/demurrage/per diem stops accruing.

Parties using ocean transportation services who are subject to demurrage and detention charges should consider submitting comments to the FMC. Once the FMC evaluates the comments it receives on the ANPRM, it will decide whether to propose specific rules establishing billing requirements for demurrage and detention.

FOR MORE INFORMATION

For more information, please contact:

Karyn A. Booth
202.263.4108
Karyn.Booth@ThompsonHine.com

Jason D. Tutrone
202.263.4143
Jason.Tutrone@ThompsonHine.com

Kerem Bilge
202.263.4104
Kerem.Bilge@ThompsonHine.com

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