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April 2 2018

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26 The Journal of Commerce | April 2 2018 Government removal of cargo and return of equipment. "While many questions remain after the hearing, I do believe it effec- tively established that the practices surrounding detention and demurrage charges can be out-of-date, confusing, inconsistent, and, in my view, often unfair," Commissioner Daniel Maffei said. The statement may signal an openness to granting the petition of the BCOs and truckers. Ocean carriers and MTOs, though, told commissioners that they resolve shipper disputes on a case-by-case basis, but also absorb real costs when containers remain untouched in a container yard. They also lose potential business oppor- tunities when boxes are stuck in the supply chain, the opposition argued. Guidelines would create more problems than they solve by using a "not-my-fault standard," shifting the risk to terminal operators, carriers and MTOs countered on Jan. 17. In effect, the granting of the petition would "transform carriers and MTOs into guarantors or insurance providers for weather events, labor disruptions, equipment shortages, and government cargo inspections," said John Butler, CEO of the World Shipping Council, whose members control roughly 90 percent of global container capacity. "The coalition raised substan- tive issues in both their petition and their testimony at our January hearing investigating carrier and terminal detention and demurrage practices. Various alleged practices were described that — without countervailing or explanatory testimony and evidence — would be troubling from my perspective," said Michael A. Khouri, acting FMC chairman. "However, without any filed complaints by cargo stakehold- ers, where the crucible of adversary proceedings can bring light and transparency to such practices, I supported this investigatory fact finding so as to more fully develop a tested factual record." JOC email: twitter: @ariashe_joc THE FEDERAL MARITIME Commission (FMC) unanimously voted to inves- tigate claims made by a coalition of beneficial cargo owners (BCOs), freight forwarders, and trucking companies that some detention, demurrage, and per diem fees are unfair because their ability to re- ceive cargo and return equipment is out of their control. The Coalition for Fair Port Prac- tices petitioned the federal agency to establish guidelines to discourage ocean carriers and marine terminal operators (MTOs) from charging hundreds of thousands of dollars when the delay in picking up or dropping off the container was out of the shippers' control. Commis- sioner Rebecca Dye will head the investigation and deliver findings and recommendations no later than Dec. 2, 2018. Shippers and truckers testified on Jan. 16 about situations in which they were forced to pay "exorbitant fees," in their words, when their containers were inaccessible because of weather emergencies, a lack of appointment windows within the allotted free time, or federal inspec- tions. Some carriers also accused terminals of using detention and demurrage as revenue generators, rather than a way to spur the timely FMC examines port fees Agency to investigate what BCOs, drayage companies, and forwarders call unfair demurrage claims By Ari Ashe Under the microscope FMC Commissioner Rebecca Dye will head the investigation of detention-demurrage claims, investigating five key issues: • Whether the alignment of commercial, contractual, and cargo interests enhances or aggravates the ability of cargo to move efficiently through US ports • When the carrier or marine terminal operator has tendered cargo to the shipper and consignee • What the billing practices are for invoicing demurrage or detention • What the practices are with respect to delays caused by various outside or intervening events • What the practices are for resolution of demurrage and detention disputes between carriers and shippers Port of Long Beach International | Washington | Customs | Security | Regulation

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