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FMC Opens Formal Investigation Into Detention and Demurrage

Last update on March 26, 2018.

FMC Opens Formal Investigation Into Detention and Demurrage

Mr. Gabriel Rodriguez, FCBF's 1st Vice President of Freight Forwarding will be meeting with Commission Dye to represent your comments and information. All information will be held in strict confidence. There will be no attribution or naming of individual companies in any report that is issued, as the source of that information will remain confidential to the Commission. Accordingly, there should be no concerns that participating or providing information to Commissioner Dye through FCBF will result in any retaliation by the carriers or the complication of business relationships. Please submit specific examples of shipments where these problems were incurred, together with supporting documentation. Comments should be emailed to bpimentel@fcbf.com

Deadline for Submissions: April 16th, 2018

Led by efforts of the NCBFAA, FCBF was part of a coalition of parties that filed a petition with the FMC requesting that the agency issue an interpretive rule on the issue of demurrage and detention charges (in Docket No. P4-16). That petition was filed as a reaction to the excessive demurrage and detention charges assessed by the lines during periods when NVOs and BCOs have been unable to pick up from or deliver containers to the piers for reasons beyond their control. For example, the service meltdown a couple of years in LA/Long Beach and the severe weather that has struck various ports has contributed to significant congestion in the ports, often making it impossible for these containers to move during the existing free time period.

As a result of the hearings held before the Commission on this topic several months ago, the FMC has now opened a formal investigation in Fact Finding Investigation No. 28. The purpose of this investigation is to more fully develop a factual record of the types of situations that arise, the types of charges that have been assessed, the efforts by NVOCCs and BCOs made both to get cargo and to mitigate these charges.

The investigation is not restricted to the LA/Long Beach labor situation or adverse weather, but also will look at all of the various factors that influence the ability or inability to move cargo off the piers. For example, truck congestion, the relative availability of chassis, whether the appointment system at various terminals is working, etc. are all questions that this proceeding is designed to consider.

In initiating this Fact Finding Investigation, Acting FMC Chairman Khouri appointed Commissioner Rebecca Dye to head up the investigation. And, as Commissioner Dye is speaking at the NCBFAA's Annual Conference on Wednesday, May 2, she has requested that NCBFAA make space available so that interested persons could provide relevant information to help her understand the issues and the problems that have been experienced.

The Association accordingly suggests that any members who experienced demurrage and detention problems, in situations where they were unable to pick up or deliver containers to the piers, should take advantage of this opportunity. This would be an excellent opportunity to explain to the Commission why the existing free time system is unfair and unreasonable in these types of unusual conditions.

As the situation also adversely affects the trucking companies that are used by NVOCCs, we encourage our truckers that are used in various ports to use this opportunity to explain their situations. Clearly, the appointment system used by many ports is often ineffective and it is often the truckers who also bear the brunt of these excessive costs.

This is an important opportunity to come forward and present information that should hopefully mitigate these types of problems from recurring in the future. FCBF accordingly encourages you to participate and provide facts that will assist Commissioner Dye's investigation.

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