FMC Clarifies That D&D Rule Applies Only on Through Bill of Lading
The Federal Maritime Commission has jurisdiction on cargo moved inland only under a through bill of lading, and contracts between a vessel-operating common carrier and a motor carrier not based on the through bill of lading would "likely be" outside the scope of commission's new detention and demurrage rule released in February (see 2402230049), the commission said. The FMC, in a correction to that rule set to be published in the May 9 Federal Register, stressed that a vessel-operating common carrier must comply with the new detention and demurrage requirements when issuing an invoice if FMC's jurisdiction applies.
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The commission in the preamble of its February rule initially responded to a comment asking that it amend the definition of "billed party" to address situations of vessel-operating common carriers entering into written contracts with motor carriers that use containers in transporting goods. The FMC declined to adopt the proposed change, and in the correction issued this week, it reiterated that decision to decline, saying that demurrage and detention should be billed to either the person for "whose account the billing party provided ocean transportation or storage of cargo and who contracted with the billing party for the ocean transportation or storage of cargo" or to the consignee.
While this was intended to explain that the rule only addresses "carrier-trucker relationships on through bills of lading," that statement was "meant to be understood in the context" that the FMC likely doesn't have authority if a contract between a VOCC and a motor carrier isn't based on a through bill of lading. The commission said it realized that the "inadvertent inclusion of certain language" makes this comment ambiguous and is clarifying its intention.