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FIATA (International Federation of Freight Forwarders Association) welcomed the US Federal Maritime Commission’s final rule on demurrage and detention billing practices
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FIATA welcomed the ruling in the context of substantial hikes in demurrage and detention charges
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The ruling promotes transparency and a level playing field across the supply chain, FIATA said
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The new regulation takes effect on May 28
FIATA (International Federation of Freight Forwarders Association) welcomed the US Federal Maritime Commission’s (FMC) ruling on demurrage and detention billing practices in the context of substantial hikes in demurrage and detention charges.
The Final Rule on Demurrage and Detention Billing Practices takes effect on May 28, and builds on the Detention and Demurrage Billing practices published on October 14, 2022, adopting the document with changes.
In a statement, FIATA enjoined its global members to embrace FMC’s final rule as a benchmark for best practices, promoting transparency and a level playing field across the supply chain.
With the new rules, it is hoped that shippers will have a clearer picture regarding the content and nature of certain demurrage and detention billing practices.
The FMC rule sets comprehensive guidelines to ensure transparency and fairness in billing procedures.
Disputes over demurrage and detention charges should also be resolved in line with inputs provided by FIATA.
Notable provisions in the document include the requirement for common carriers and marine terminal operators to add specific and identifiable data on their demurrage and detention invoices.
This requirement should facilitate a clearer understanding for customers on the nature of charges they incur.
The final rule also defines some practices to be filed in the billing processes.
As an example, the document states who pays the charges. It is either the person who contracted the billing party for the transport or storage of cargo, or the consignee or recipient of that cargo.
Also, the document establishes a clear timeframe when the demurrage and detention invoices may be issued, allowing a maximum of 30 calendar days from the last day that the charges were incurred.
The recipient of the invoice is given at least 30 days to dispute the charges.
The FMC developed the rules based on inputs from the industry. FIATA, through its working group, played a key role in the process by sharing its expertise as well as information from its global freight forwarding members.
FIATA took an active role in developing the final rule by spreading awareness of its proposed terms throughout the maritime industry. It also brought to FMC’s attention the primary concerns of freight forwarders on demurrage and detention practices.
The FMC’s final rule represents a landmark step towards transparency and fairness in maritime transport operations, contributing to efficiency and minimizing unreasonable maritime billing practices.
READ: FIATA calls for global oversight, cooperation to ease maritime transport
