A recently signed California law will “significantly” limit the ability of marine container providers or terminals to impose detention and demurrage charges, law firm Cozen O’Connor said in an alert this month. The law, effective Jan. 1, outlines 10 situations in which container providers will not be able to begin or continue free time or impose fees on motor carriers and cargo owners “due to circumstances ostensibly beyond those parties’ control,” the firm said.
The Federal Maritime Commission this week officially sent its proposed rule on demurrage and detention billing requirements to the Federal Register (see 2210070079). Public comments on the rule are due Dec. 13.
CORONADO, Calif. – The Federal Maritime Commission needs industry input into key provisions of its newly announced detention and demurrage proposed rule (see 2210070079), and in particular on a provision limiting charges only to parties that have a contractual relationship, said Lucille Marvin, FMC managing director, during a panel discussion Oct. 8 at the Western Cargo Conference.
The Federal Maritime Commission released a notice of proposed rulemaking further refining prohibited practices for demurrage and detention, which is required under the Ocean Shipping Reform Act (OSRA).
Flexport violated the Shipping Act when it failed to include required information on more than $100,000 worth of detention and demurrage charge invoices, Indiana-based Philip Reinisch Co. said in a recent complaint to the Federal Maritime Commission. Philip Reinisch said the FMC should order Flexport to refund more than $55,000 in paid invoices, award it damages for the “wrongful withholding” of containers and nullify nearly $50,000 in outstanding charges.
The Federal Maritime Commission has received nearly 100 charge complaints and numerous questions related to the Ocean Shipping Reform Act since its enactment earlier this year, FMC official Lucille Marvin said during a Sept. 21 FMC meeting. She also said the agency is making progress on a range of OSRA provisions and other agency priorities, including one that will result in a set of best practices for chassis pools and another that will formally propose new demurrage and detention billing requirements.
The Federal Maritime Commission should issue an emergency order requiring carriers and terminal operators to share more information on cargo availability with shippers and other carriers, more than a dozen motor carriers and logistics companies said. The companies, most of which move freight at the Port of New York and New Jersey, said inadequate information sharing has created an emergency that is hurting their operations and restricting cargo from moving efficiently.
The National Customs Brokers & Forwarders Association of America sent a letter to the Federal Maritime Commission last week requesting guidance on Ocean Shipping Reform Act regulations. In an Aug. 15 email to members, NCBFAA said it asked the FMC for more “clarity” on OSRA provisions that restrict common carriers from invoicing parties for detention and demurrage unless the invoice includes certain required information. The group also asked the commission about the fee dispute process; made “inquiries with respect to the treatment of ocean carrier vendors, such as railroads and chassis pools”; and asked about new, prohibited conduct for common carriers. NCBFAA asked FMC to explain “to what extent do these new prohibitions and requirements, especially for invoicing, apply to marine terminal operators, customs brokers, freight forwarders, breakbulk agents, and other entities assessing and invoicing” fees.
The Federal Maritime Commission is making headway on implementing the Ocean Shipping Reform Act of 2022 and is preparing two new rules that will further revise or clarify how its regulations apply to carrier and shipping practices.
Ongoing labor negotiations between West Coast ports and their dockworkers’ union are unlikely to cause major disruptions, said David Bennett, chief commercial officer of Farrow, a customs broker and logistics provider. But that doesn’t mean shippers should expect the negotiations to wrap up anytime soon. “I don't think we'll have a contract before September, to be honest with you,” Bennett said during a July 14 webinar hosted by the Journal of Commerce.