b'6American Journal ofTransportation ajot.comShippers and brokers applaud FMCEnforcement actiondemurrage and detention guidelines By Peter Goldin, AJOTNew ruling provides essential protections, but lingering issues remain. Recent FMC actions may provide a preview of how the new ruling onDetention&Demurragewillbeenforced.TheFMCOfficeof By Pete Goldin, AJOT Enforcement filed a brief on April 4 asking mega-carrier MSC to pay a penalty of $63 million for violations of the U.S. Shipping Act, includ-Shippers, brokers and manyDavis.Shippersshouldhavenizes both the ability of MTOsing charging unfair detention fees. It is a record penalty and to many others in the supply chain indus- fairness and redress to make suretorequirepaymentofdemur- represented ramping up of enforcement by the FMC.try are praising a new final rulingD&DchargesarecorrectandragechargesbeforereleasingAmong the infractions, the brief calls out MSCs unreasonable from the Federal Maritime Com- justified, but Congress examinedcargoandthefactthatMTOand unjust actions resulting in overcharges to its customers, less mission(FMC)crackingdownthiscarefullyandspecificallyschedules are implied contracts,free time, and more days of detention.on unfair demurrage and deten- decided port and terminal prac- ensuring continued supply chainMSC has subsequently said that it would fight the excessive tion (D&D) practices. (See side- tices were consistent and fair. fluiditybyincentivizingthepenalty. [reported in AJOT.com Daily News]bar on Enforcement Action) RobertMurray,Presidentmovement of cargo through ter- FMC Chairman Daniel Maffei, speaking at the Coalition of New FMC states that the ruling,oftheNational Associationofminal demurrage charges to allEngland Companies for Trade (CONECT) on April 10th in explain-Demurrage and Detention Bill- Waterfront Employers (NAWE),relevant parties. ing the agencys ramped up enforcement efforts said that the agency ing Requirementswhich wasexplains further, The final ver- wasnt trying to stick it to anyone. But rather the Commissioner saw finalizedinFebruary,conclud- sion of OSRA 2022 struck MTOsc onTrAcTuAl the FMCs role more like that of a referee whose regulatory obligation ing a multi-year process to regu- fromthelawssubstantivec omPlicATions is to keep the game fair. But as Chairman Maffei pointed out the referee lateD&Destablishesnewdemurrage billing requirements.A high-profile aspect of thehas to be ready to call a foul when there is an infraction of the rules. requirements forhowcommonMTOsandmembersofCon- FMC ruling specifies that D&DAnd from a shippers perspective the game has seemingly been unfair carriersandmarineterminalgress urged the FMC to followchargesonlyapplytopartiesfor a long time and the Ocean Shipping Reform Act (OSRA) is in operators(MTOs)mustbillthis Congressional intent, how- that have a contractual relation- place to rebalance the relationship between carrier and shipper.fordemurrageanddetentionever, the FMC chose to adopt aship with the carrier or MTO. Failing to fix the non-compliant practice, after being made charges,providingclarityonbroader final rule that includedVincent Iacopella, EVP Stra- aware, should be subject to forceful enforcement, says Peter Fried-who can be billed, within whatMTOs. While this aspect of thetegic Growth at Alba Wheels Upman, executive director of the CONECT in reaction to this pen-timeframe, and the process forfinal rule was concerning, it is(APPLAUDcontinued onalty. Hopefully, all carriers will learn from this FMC enforcement disputing bills. positive that the final rule recog- page 10) (ACTIONcontinued on page 38)This ruling is welcome news forshippers,importers,freight forwarders, customs brokers, and truckingcompanieswhooften partnerinsupplychains,saysField FreshSandra Castro, director of business management at JF Moran. forOverall,webelievetheWith Less WasteFMCsruleondetentionand demurrage billing will be positive the supply chain, Jonathan Gold, National Retail Federation (NRF) VP of Supply Chain and Customs Policy, concurs.A Q uesTion off AirnessDetentionanddemur-rage billing is a critical policy empoweringterminaloperators toincentivizecargofluidityat ports,statesCaryS.Davis, president and CEO of the Amer-ican Association of Port Author-ities, (AAPA), and FMC agrees.However,manyindustry expertsfeelD&Dfeeshave oversteppedthatobjective, unfairly penalizing shippers and others. Bill Westman, executive director,MeatImportCoun-cilofAmerica(MICA),says someMICAmemberswere billed millions in D&D charges in recent years. Its important tokeepdetentionanddemur-ragechargeslimitedtotheir intendedpurposeofincentiv-izing the movement of goods, he warns.GoldsaysNRFhasbeen raising concerns about the lack of clarity around D&D charges foryears.Thesechallenges were further highlighted by the significant costs we saw during the pandemic due to congestion and the inability of shippers to pick up their cargo because of issues beyond their control. Addressing this question of fairness, the ruling requires carri-ers and MTOs to state the reason D&D charges were assessed on the invoice and certify that theFood Waste Remote Climate Zero CO 2 Best in Class billing partys performance didMitigation Tech Controls Emissions Equipmentnotcauseorcontributetothe underlying invoiced charges.Thisnewrulewillpro-vide clarity to the billing pro-cess which was sorely needed,Its not just the boxGold responds. its our approach to offering food waste mitigation Noteveryoneagreesthesolutions bundled with leading edge technology that rulingwasnecessary,however.makes the difference.AAPAis concerned that theVisit www.seacubecontainers.com to learn more.FinalRuledoesnotalignwith Congress intentions in the Ocean ShippingReformAct,says BSYA 1084 SeaCube Field Fresh Lemon 8x10 AJOT_r2.indd 1 4/15/24 9:22AM'