New requirements to be met, more clarity on who has to pay, on billing times and on how to submit complaints and disputes. This is the essence of the new regulation with which the Federal Maritime Commission intends to solve the complicated issue of demurrage charges common carriers and marine terminal operators bill for using containers inside terminals beyond the free period, and of the storage fees (demurrage), paid for using containers outside the terminal or depot, beyond the free period.
The final rule will be in force from 28th May. It stipulates, among other things, that demurrage & detention invoices may only be issued to: (1) the person on whose behalf the carrier provides ocean transportation or cargo storage for and who has entered into a contract with the billing party for ocean transportation or cargo storage; or (2) the “consignee”, defined as “the ultimate recipient of the cargo; the person to whom final delivery of the goods is to be made.” Demurrage and detention invoices may not be issued to more than one party at the same time.
The regulation also requires vessel-operating carriers (VOCCs) and MTOs to issue demurrage and detention invoices within 30 days.
The party receiving the invoice also has at least 30 days to submit requests for mitigation, refund or waivering the tariff. If a timely request for mitigation is made, the biller must attempt to resolve the issue within 30 days, unless both parties agree to a longer period of time.
According to the FMC. the new regulation supports the Commission in its attempt to promote supply chain fluidity by ensuring a clear, timely link between “failure to pick up cargo or return equipment in a timely manner and the appropriate fee.”
The final rule ensures that the person receiving the invoice understands the charging mechanisms well, and also requires certain information to be included in it: “Failing to include any of the required information in a detention or demurrage invoice eliminates any obligation of the billed party to pay the applicable charge” says the FMC. However, it also states that if an invoice is compliant, the party billed for the detention & demurrage charges is obliged to pay them.
According to the Federal Maritime Commission, the new rule will provide relief to those who should never have received an invoice for detention or demurrage.
Translation by Giles Foster
