U.S. Maritime Commission issues new guidance for detention and demurrage

The Federal Maritime Commission (FMC) has issued new guidance about how it will assess the reasonableness of detention and demurrage regulations and practices of ocean carriers and marine terminal operators.

The final rule, “Docket No. 19-05, Interpretive Rule on Demurrage and Detention under the Shipping Act“, will become effective upon its publication in the Federal Register.

Under the new interpretive rule, the Commission will consider the extent to which detention and demurrage charges and policies serve their primary purpose of incentivizing the movement of cargo and promoting freight fluidity. The rule also provides guidance on how the Commission may apply that principle in the context of cargo availability (and notice thereof) and empty container return.

This final interpretive rule is the culmination of a process initiated by a petition submitted to the Commission in December 2016 by a coalition of shipper groups. In the intervening period, the FMC held public hearings in January 2018; initiated a Fact Finding Investigation in March 2018 led by Commissioner Rebecca Dye; and issued a proposed rule in September 2019.

Source: FMC

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