Trade Groups Ask House Committee to Clarify FMC Authority Over Rail Storage Fees
Congress should amend shipping regulations to give the Federal Maritime Commission jurisdiction over certain fees assessed by railroads under ocean bills of lading, more than 70 trade groups, including the National Customs Brokers & Forwarders Association of America, said in a May 2 letter to the House Transportation and Infrastructure Committee. The groups said those charges should be billed through the contracting carrier and be subject to demurrage and detention invoicing requirements that were included as part of the Ocean Shipping Reform Act.
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The letter, previewed by the NCBFAA last month (see 2304280057), said shippers are facing rail storage fees, a form of demurrage, after ocean carriers contract with railroads to deliver goods to a U.S. inland point under a through bill of lading. When containers are delayed at the railyard, "often because of the railroad's terminal operations," the groups said, rail storage charges accrue. They said these fees need to be paid directly by importers or their agents in order for their goods to be released.
When these charges are assessed unfairly, there is "no regulatory agency with direct authority over such charges," the trade groups said. The Surface Transportation Board does not deal with intermodal transportation, and the FMC's authority over these charges "remains unclear," the letter said.
The groups said several FMC commissioners have publicly stated that the commission "does have jurisdiction over inland charges on through bills of lading." But commissioners have also said "they only have this authority over FMC-regulated entities, which do not include the railroads," the letter said. The groups said this is a gap that "must be clarified."
"The shipping public does not have a contractual relationship with the railroad," the letter said, "nor do they have a regulatory agency to appeal to that clearly oversees the proper conduct or application of these charges."
The groups asked Congress to amend U.S. shipping regulations by adding a new requirement stating that common carriers are the "billing party" for certain third-party detention and demurrage charges assessed by the carrier's contractors on containers transported under ocean through bills of lading. "This would more clearly establish that rail storage charges assessed as part of through international ocean transportation are under the operational authority of the FMC and that any unreasonable charges would be governed by the requirements of OSRA22," the letter said. The House Transportation and Infrastructure Committee did not immediately respond to our request for comment.