In a landmark decision, the Federal Maritime Commission (FMC) has finalized a ruling aimed at simplifying the intricate billing processes associated with international container shipments. This move has been widely praised by truckers who have long borne the burden of paying ocean carrier detention and demurrage fees upfront, only to be reimbursed by shippers later.
Demurrage fees, incurred when containers exceed their allocated free time on docks, and detention charges, known as per diem, applied when containers remain off docks after the free days have elapsed, have been significant challenges for truckers in the shipping industry.
The FMC’s ruling, issued on February 26 and set to take effect on May 28, except for certain forthcoming amendments, introduces a crucial change: ocean carriers are now mandated to submit invoices for these charges within 30 days, down from the previous 60-day window.
The International Motor Carrier Coalition (IMCC) and the American Trucking Associations (ATA) had strongly advocated for this clarification to be included in the Ocean Shipping Reform Act of 2022 when it was passed. This advocacy stemmed from the substantial financial burdens faced by motor carriers due to hefty detention and demurrage charges imposed by ocean carriers during container delays.
The implications of this new ruling extend to drayage companies operating at ports and trucking companies responsible for transporting international containers from inland rail facilities. It is anticipated to streamline billing processes, alleviate financial strains on truckers, and foster greater efficiency within the container shipping ecosystem.
