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September 30 2019

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September 30 2019 | The Journal of Commerce 15 International Maritime In an interview, Dye said the agency isn't seeking to determine "fault" or whether the factors of calculating detention and demurrage fees are fair. Instead, she said, the recommendations will focus on how the agency considers whether the fees are reasonable in terms of encouraging better cargo flow — whether that be the timely pickup of cargo or return of marine containers. In short, a Dye-led innovation team recommended promoting standardized definitions of deten- tion and demurrage, simplifying dispute resolutions and fee billing practices, providing guidance on what evidence is needed for dispute resolution, and keeping the industry informed on container availability and equipment returns. Shippers and truckers, some of whom have accused marine terminals and carriers of using demurrage and detention fees as revenue generators, argue they shouldn't have to pay the fees if factors out of their control prevent the pickup of cargo or return of equipment. Marine terminals and THE TOP UNITED States maritime regulatory agency in early September unanimously approved interpretive rulemaking recommendations aimed at helping it gauge whether levied demurrage and detention fees truly incentivize the retrieval of cargo and return of containers. The Federal Maritime Commission (FMC) agreed to the recommendations stemming from a year-and-a-half effort led by commissioner Rebecca Dye to address complaints from cargo owners and drayage drivers about what they considered unfair fees for failing to pick up cargo and return equipment in a timely manner. The recommendations reflect an agency seeking to encourage com- mercially driven solutions and firm up how such disputes are reviewed with- out plunging into a complex tangle of business agreements. "Our approach from the begin- ning has been to enhance the com- petitiveness of the US freight delivery system," Dye said. carriers counter that the fees are meant to encourage better cargo flow and that too much rigidity will only further complicate commercial disputes. In April, carriers published a list of four best practices to resolve detention and demurrage disputes, which Dye said informed her own recommendations. That list met with a mixed response from cargo owners, including those involved in the peti- tioning coalition. Dye also recommended the FMC create a shipper advisory board and support the work of a coalition of beneficial cargo owners (BCOs) and truckers tackling chassis problems in Memphis. The Memphis Supply Chain Innovation Team in late May presented a white paper highlighting its findings to the US Surface Trans - portation Agency, encouraging the top US rail agency to address chassis woes in the region. The Agriculture Transportation Coalition welcomed the FMC's vote to agree to recommendations, although executive director Peter Friedmann said it was not clear that all the commissioners understand the damage caused by unfair detention and demurrage fees, which range from $125 to $325 per container each day. In a notice to AgTC's membership of importers, exporters, forwarders, and truckers, Friedmann said, "The time has come for the FMC to fulfill its statutory responsibility to protect the interests of the US shipping pub- lic. (Otherwise, why should the FMC continue to exist?)" JOC Going with the flow FMC to gauge detention/demurrage fairness on flow merits By JOC Staff "Our approach from the beginning has been to enhance the competitiveness of the US freight delivery system." Importing & Exporting | Ports | Carriers | Breakbulk | Global Logistics

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