Report: Rules, Rates, and Practices Relating to Detention, Demurrage, and Free 

Time for Containerized Imports and Exports Moving Through Selected United 

States Ports

April 3, 2015

Executive Summary

Between September and early November 2014, the Federal Maritime Commission 

(FMC) held four forums at major gateway ports to foster dialogue between 

industry stakeholders, regulators, and the general public on the causes, impacts 

and possible solutions for the congestion experienced in seaports around the 

country.

At the forums, and since, the public has expressed concerns relating to the 

assessment of demurrage and detention charges by marine terminal operators

(MTOs) and vessel-operating common carriers (VOCCs) where importers and 

exporters (and their truckers) have experienced terminal delays over which they 

have no control.

As a result of the strong concerns expressed by those subject to paying high 

demurrage and detention charges due to port congestion, this report collects and 

conveys the frustrations and concerns expressed by importers, exporters, and 

drayage providers, and makes observations about the steps the industry may take 

to address the concerns relating to demurrage and detention practices of VOCCs 

and MTOs. This report also provides a collection of possible tools the Federal 

Maritime Commission may have to address these concerns under certain 

circumstances.

Demurrage is a charge for the use of space; detention is a charge for the use of 

equipment. Free time is the grace period for which neither of these charges will 

be incurred. Both are meant to compensate for the use of space and equipment, 

and to encourage the efficient movement of cargo by importers, exporters, and 

drayage providers.

This report reviews the published rules tariffs of six vessel-operating common 

carriers at 32 terminals across the United States, and reveals that average total 

prices for both demurrage and detention may be higher for importers than 

1
exporters, higher for demurrage than detention, and that both charges appear 

similar across all ports, except for New York/New Jersey, where they are much 

higher on average. It appears that VOCCs, rather than MTOs, generally control 

these prices and policies affecting importers and exporters directly. The 

demurrage and detention rates for the VOCCs whose tariffs were studied vary

somewhat depending on port and terminal, but the terminology and application of 

charges with similar names are distinct across these VOCCs, making direct 

comparisons difficult.

2
INTRODUCTION

The first forum, hosted by FMC Chairman Cordero, was held in Los 

Angeles, California in September, 2014. In October, a forum co-hosted by 

Commissioners Lidinsky and Doyle, was held in Baltimore, Maryland and another, 

hosted by Commissioner Khouri, in Charleston, South Carolina. Commissioner 

Dye hosted the final forum in New Orleans, Louisiana in November, 2014. 

Participants noted that many factors contribute to the current port congestion 

and related effects. At the forums, the Commission and staff heard concerns 

relating to the assessment of demurrage and detention charges by marine terminal 

operators and vessel-operating common carriers where importers and exporters 

(and their truckers) experienced terminal delays over which they had no control. 

Many shippers reported that they had been repeatedly told by the MTO that they 

could not pick up a container due to on-dock congestion and gate delays. Similarly, 

once the terminal allowed the importer or exporter to pick up the cargo, shippers 

reported that the VOCC or MTO would not release the container until demurrage 

charges had been paid.

Since the forums were held, many more such informal complaints have been 

received by the Chairman, the Commissioners, and a number of the Commission’s 

3
operating bureaus and offices, including the Office of Consumer Affairs and 

Dispute Resolution (CADRS), the Office of General Counsel (OGC), Bureau of 

Trade Analysis (BTA), and Bureau of Enforcement (BOE). As a report on the 

congestion forums, and in light of the increasing number of complaints, the 

Commission’s staff was instructed to provide the Commission with a review of: 

demurrage and detention free-time, rates, and practices as they have been normally 

applied. The staff was also instructed to prepare summaries of situations in which 

shippers have complained they have been charged, although they had been 

prevented by the VOCC or MTO from picking up or delivering containers on a 

timely basis.

The report describes current demurrage and detention rates, rules and 

practices of several of transportation service providers. We have relied on 

information that must be published by vessel-operating common carriers in their 

tariff publications and by MTOs in their schedules (still frequently referred to as 

“tariffs”) pursuant to 46 CFR Parts 520 and 525 and the Shipping Act. Appendix

A. This report also collects and summarizes demurrage and detention levels across 

the six carriers at each of the studied terminals. Appendix B. This report, 

4
however, does not attempt to reflect the total cumulative effect of the additional 

expense of congestion on the national economy.1

BACKGROUND

In order to understand the charges related to delays in transportation, it is 

important to understand common transactions relating to the movement of 

containerized cargo for oceanborne import into and export from the United States. 

Imports

Prior to the arrival of a vessel bearing containers for import, it is customary 

for the VOCC to send an “arrival notice” to the consignee and any “notify parties” 

(the parties that must be informed of the shipments imminent arrival) indicated on 

1

 The National Retail Federation has estimated that complete shutdown of West Coast ports 

would amount to an impact on the economy of $2B per day. The Agriculture Transportation 

Coalition recently estimated the reduction in port productivity has cost U.S. agriculture $1.75B 

per month in lost export trade. There are many individual accounts of importers and exporters 

reporting additional costs significant enough to mention in their quarterly earnings reports. See, 

e.g., Joseph Bonney, Federal Reserve report notes US West Coast port delay impact, Journal of 

Commerce (January 13, 2015), http://www.joc.com/node/2906001 (“Athletic apparel retailer 

Lululemon Athletica has already told investors that congestion will cost it $10 million in 

revenue, and New York & Co. said it has to pay $2 million more to reroute freight through U.S 

East Coast ports and shift some cargo to air services.”) The Executive Director of the Port of 

Long Beach has estimated that the delays cost the industry $1B per day; over the last six months 

he asserted the cost to the entire economy has been over $1T. 

http://www.bloomberg.com/news/articles/2015-02-11/port-deal-near-as-single-issue-remainslong-beach-chief-says

5

 
the ocean bill of lading (also sometimes called “master bill of lading” or 

“steamship bill of lading”). This arrival notice may be sent via U.S. mail, fax, or 

electronically via e-mail, depending on the VOCC. If the shipment is consigned to 

an NVOCC (non-vessel-operating common carrier), the NVOCC in turn will send 

out an arrival notice to its client (who may be another NVOCC or a beneficial 

cargo owner (BCO)) and also to the parties shown on the NVOCC-issued “house 

bill of lading” (HBL). The consignee may engage a customs broker to make 

arrangements to pick up the container – usually by issuing a “delivery order” 

(either in hardcopy or electronically) to a trucking company.2 The delivery order 

will tell the trucking company the container’s bill of lading number, container 

number and location. The trucking company (motor carrier) will then check the 

MTO’s website to verify that the container is available for pick up. Before a 

container can be released from the terminal to the trucker, the shipment must have: 

(1) “delivery authorization” from the U.S. Customs and Border Protection (CBP)

(showing no holds by CBP or any other U.S. inspection agency); (2) a “steamship 

release” issued by the VOCC (or its agent), indicating the ocean freight and all fees

2 Depending on the terms of carriage, the motor carrier may be hired by the VOCC or by the 

consignee, or hired by the VOCC but “nominated” by the consignee. See, e.g., COSCO 

Tariff 201 Rule 002-064, Store Door Delivery/Pick Up Service (effective April 12, 2012).

6

 
(including demurrage) have been paid and the original ocean bill of lading (if any)

has been surrendered; and, (3) an indication that delivery order instructions have 

been issued to the MTO releasing the cargo to the authorized trucker.

The available import container is picked up by the trucker and drayed to the 

BCO’s desired location as instructed by the delivery order. The trucker either 

drops off the loaded imported container (on or off a chassis, as directed by the 

BCO) and may in the same trip pick up an empty or loaded container (or wait for 

the loaded container to be emptied) from the BCO for return to the terminal. For 

the return of their empty containers, VOCCs instruct the consignees and terminal 

operators who serve them when, where, and how this equipment can be returned. 

Exports

An exporter, or his freight forwarder, books a shipment with a VOCC. This 

is usually done through an electronic system. When an export container is booked,

the exporter or freight forwarder will receive from the VOCC’s system a booking 

confirmation indicating the vessel’s name, expected arrival date, the date by which 

the exporter must present the container for loading at the terminal (“cut-off date”)

and other details of the booking. The carrier’s or terminal’s rules may indicate 

how many days in advance of a vessel’s scheduled sailing date a loaded container 

7
may arrive at terminal without incurring storage charges. This is commonly called 

“export demurrage free time.” Once a slot is booked with the VOCC for the export 

container, an exporter usually must arrange for an empty container to be picked up 

from the VOCC’s terminal or depot, load it, and return the loaded container in a 

defined window of time to the designated terminal for loading onto the vessel. The 

full container is received by the MTO, then gets loaded on the vessel. 

8
Free time, Demurrage and Detention Defined

The six VOCC tariffs examined for this report reveal that there is little 

standardization of practices among them. This report attempts to provide a 

comparison of like terms, but may not always be successful.3 The terms of carriage 

(“store door” or “carrier haulage” as opposed to “CY” or “merchant haulage”) 

affect the calculation for the termination and conclusion of the free time period, 

who is to be charged, and how much. Although the terms are sometimes used 

interchangeably, this report explores only detention assessed to the shipper for the 

use of the carrier’s container, for exports, after it leaves the terminal gate and is 

returned for loading on the vessel, and for imports, after it leaves the terminal gate 

for unloading and is returned to the terminal empty.4

3 It is common, for example, for those familiar with the industry to refer to charges such as “line 

demurrage” or “terminal demurrage.” Because those terms do not appear in published VOCC 

tariffs that were examined for this report, those terms are not used here. Similarly, for carrier 

haulage, even though the VOCC is responsible for the provision of the drayage trucking, the 

merchant may “nominate” the trucker. For simplicity’s sake, such considerations are not 

explored in this report.

4 This report does not explore the many variations of approaches to charges to the drayman for 

the use of the VOCC’s equipment, i.e., per diem (“the daily charge assessed to the drayman, or at 

the carrier’s option to the shipper or consignee, against the ocean carrier’s equipment, for the use 

of the equipment beyond allowed free time, as stipulated per tariff or contract, and moving under 

merchant arranged haulage on a Container Yard (CY) bill of lading.”) Maersk Line, Demurrage 

– World (Excluding OFAC Countries) to United States (effective November 22, 2014); per diem 

(export) is “charge for use of carrier’s equipment after delivery to the merchant (exporter) or 

9

 
Free Time

In order to avoid demurrage and detention charges, import and export 

shipments must be handled by the shipper within a period of grace, i.e., “free 

time.” The term “free time” is generally used in the industry to mean the period of 

time during which no demurrage or detention charges will apply for the use of a 

container, in addition to basic freight costs.

5

 These rates and rules may be

specified in a VOCC’s tariff, a terminal or port authority’s MTO schedule, or in a 

service contract between a shipper and VOCC. For charges assessed by MTOs, 

free time means the period of time during which cargo may occupy space assigned 

to it on terminal property, including off-dock facilities, free of demurrage or 

agent.” See also, MSC Governing Rules Tariff FMC 12 (MESU-12), Demurrage/Storage –

Detention – Per Diem – USA & Puerto Rico (106)(effective August 7, 2014); per diem (import) 

is “a charge assessed after the expiration of free time outside of the Terminal . . for the usage of 

carrier’s equipment (full or empty) until it is returned to carrier’s custody.” MSC Far East EB (to 

USA) & WB (from USA) Freight Tariff & Rules (MESU-032)(effective November 15, 2014).

Per diem rules are usually governed by an amendment to the Uniform Intermodal Interchange 

Agreement (UIIA) made with a motor carrier, which are themselves frequently published in the 

VOCC’s publicly available ocean tariff.

5 “Free time is not a gratuity to be granted or denied at the whim of the provider of ocean 

transportation – ‘it is required as a necessary part of the carrier’s transportation obligation.’” 

Docket No. 68-9, Free Time and Demurrage Practices on Export Cargo, 13 F.M.C. 207, 213 

(1970)(quoting Investigation of Free Time Practices – Port of San Diego, 9 F.M.C. 525, 539 

(1966) and citing American President Lines, Ltd. v. Federal Maritime Board, 317 F.2d 887, 888 

(D.C.Cir. 1962)). The concern in that proceeding was unlimited free time for exports that the 

Commission found was causing congestion at New York and Philadelphia. 

10

 
terminal storage charges and usually immediately prior to the loading or 

subsequent to the discharge of such cargo on or off the vessel. For charges 

assessed by VOCCs, free time refers to the period of time the cargo interest can 

use the VOCC’s equipment without incurring detention charges.

Historically, MTO schedules and VOCC tariffs allowed for five working6

days of free time for both import and export containers, and, for most ports in the 

U.S., this remains the standard allowance – the notable exceptions being the Ports 

of New York/New Jersey, Los Angeles and Long Beach, where four days is 

standard demurrage free time. As vessels grew in size over the decades and 

availability of terminal space became a premium, some MTOs and VOCCs 

reduced the amount of free time in selected ports to four working days, and at the 

same time increased the amount of demurrage charges.7

 Because longer container 

dwell time (generally considered the amount of time the container remains at the 

6 Generally, “working days” are used to calculate free time. The calculation of days for 

demurrage and detention charges, on the other hand, are generally done using calendar days. 

The exception to this is for the calculation of detention and per diem charges in California. See, 

e.g., Maersk Line tariff, Detention – United States to/from World, Detention/Per Diem (effective 

November 30, 2014): “For merchant haulage at California locations, per diem charges shall 

apply per calendar day excluding weekend or holiday closures.” See also, COSCO Tariff 201, 

Addendum to the Uniform Intermodal Interchange and Facilities Agreement.

7

 This report provides a snapshot of current tariff practices; it does not provide an analysis of 

historical changes in free time or demurrage/detention rates.

11

 
terminal, rail ramp, or inland container yard) reduces equipment inventory, it 

diminishes the VOCC’s ability to carry cargo. The primary goal of reduced free 

time and increased demurrage was to encourage shorter dwell times at the terminal 

and thereby increase the overall velocity of the equipment, which reduces the 

VOCC’s equipment inventory needs and its operational costs.

Demurrage 

Demurrage is a charge assessed for cargo remaining in or on terminal 

facilities after the expiration of free time, unless arrangements have been made for 

storage.8

 Demurrage practices, such as the exact time when free time begins to 

8 The National Customs Brokers and Forwarders Association of America, Ocean Freight 

Forwarder Certification Program, Study Guide, version 1, Part II - Glossary (1996) defines 

demurrage as “an accessorial charge by a carrier or terminal operator for failure to pick-up . . . 

cargo within the free time following availability...” In its tariff, Maersk defines demurrage as 

the “daily charge assessed to the shipper/consignee, against the cargo, for use of the land and 

services provided at the carrier’s load/discharge port, rail ramp or inland container yard (CY) 

facility, when the cargo remains in such facilities beyond the permitted freetime as stipulated per 

tariff or contract.” MSC defines demurrage/storage (for import containers) as “a charge assessed 

for the occupation of land at marine terminal or rail ramp after the expiration of free time as set 

forth in the port operators marine terminal tariff, or rail operator’s tariff. These charges will be 

invoiced only once to the cargo interest by either the [MTO], rail operator or the ocean carrier. In 

the event the [MTO] or rail carriers [sic] elects to invoice the carrier, then the carrier will invoice 

the consignee (merchant) at the following rates and conditions or at the terminal public tariff, 

whichever is higher...” According to COSCO’s tariff, demurrage charges are those “costs which 

are incurred when a container with cargo, or cargo devanned from a container, is held at carrier’s 

discharge port CY [container yard] or CFS [container freight station], or destination point CY or 

CFS, or at a carrier’s Destination Interchange Terminal (DIT), beyond the permitted free 

12

 
run, vary between ports9 and sometimes even between terminals at the same port. 

MTOs generally honor the VOCC’s demurrage instructions.10 The demurrage 

rules can be found in the VOCC’s published tariff rules or the MTO’s published 

terminal schedule.

11

VOCCs’ rules regarding free time for import demurrage vary, but generally

state that demurrage will begin on the first day after the container (or shipment) is 

discharged from the vessel.12 The time of day when free time will begin may also 

depend on the terminal at which the container has been discharged.13

demurrage time...” COSCO Far East – USA tariff (201), Free Time/Demurrage at Destination 

USA, Rule Number 023-B (effective November 22, 2014).

9 The Port of Los Angeles defines wharf demurrage as “the charge...assessed against 

merchandise which remains on a municipal wharf or wharf premises after the free time allowed.” 

POLA Tariff No. 4 (effective December 11, 2006). APMT MTO Schedule Item No. 600: 

“Wharfage is the charge assessed against merchandise, calculated in accordance with the 

wharfage charges named in this Tariff for the passage of that merchandise onto, over, through or 

under wharves or wharf premises, or between vessels or overside vessels (to or from barge, 

lighter, or water) when berthed at wharves or wharf premises, or when moored in a slip adjacent 

to a wharf or wharf premise. Wharfage is solely the charge for use of wharves or wharf premises 

and does not include charges for any other service or facility.”

10 See, e.g., New York Terminal Conference, Section IV, Item 2.B. (effective January 6, 2015).

11 Fifty-eight percent (58%) of MTOs registered with the Commission currently publish an MTO 

schedule.

12 Variations on this include when the entire vessel is discharged or when the shipment (not just 

the single container) is discharged. Because many terminals work to discharge vessels when the 

terminal gates are not open, most free time rules also specify at what time free time will begin. 

13

 
Free time for imports is generally done on a “working day” basis; the days 

during which a terminal is not working, free time days will not be assessed. These 

are generally speaking Saturdays, Sundays, and Labor Holidays. Some VOCC 

tariffs define “working days” more precisely to include any day during which the 

terminal is working, even if only partially. Free time for imports does not 

generally cease when a container or shipment has been selected by a Federal 

government agency for inspection (CBP, USDA, CPSC, etc.).14 With the 

exception of ports in California, where state law does not allow for the accrual of 

demurrage charges on non-working days, demurrage charges generally accrue on a 

calendar day basis. 

Demurrage on imports begins to accrue when a shipment is not collected 

from a terminal after unloading when it has come to a point of rest on the terminal 

For example, the Port of Long Beach states, “free time shall commence for each container at 

3:00 AM after that container is discharged from the vessel.” Port of Long Beach, Tariff No. 4 –

Section 2; Rule 34-D, Section 4, Item 402, Free Time Commences (December 12, 2014). 

13 For example, under its tariff, Maersk begins assessing free time at 0100 on the first business 

day following discharge of the container, except at APMT in Newark, Norfolk, Houston and Los 

Angeles, where Maersk free time begins at 0800 on first business day after discharge. 

14 The notable exception to this is the Port of Long Beach, whose tariff provides an exception for 

imports on certain CBP holds. See Port of Long Beach, Tariff No. 4 – Section 2; Rule 34-D, 

Section 4, Item 402, Exception 2 (December 12, 2014). 

14

 
within its free time. Demurrage commonly may accrue due to failure by the 

importer to obtain a steamship release prior to the expiration of free time. This can 

sometimes be caused by a delay in timely processing of documentation from the 

shippers’ overseas office. Other causes for demurrage relate to an importer’s 

warehouse or distribution center’s inability to timely process containers. 

Additionally, when vessels bunch at the terminal, and free time for many 

shipments expires on the same day, there is incredible urgency for BCOs and their 

truckers to pick those containers up on the last free day (LFD) and as a result there 

may be congestion at the terminal gates or, for terminals that require appointments, 

an inadequate number of available appointments on the LFD.

Typically, MTOs collect demurrage charges from the cargo interest 

(consignee) according to the rates and free time as instructed by the VOCC. The 

VOCC’s instructions may be based on its own tariff provisions, the terms of a 

confidential service contract between the BCO and the VOCC on file with the 

FMC,15 or the terms of a Uniform Intermodal Interchange Agreement (UIIA) with 

15 Although all terms of service between a VOCC and shipper may be negotiated, it may be more 

likely for service contract parties to negotiate terms varying from the public tariff terms for 

detention, but not for demurrage rates and practices; per diem charges governed by the UIIA to 

drayage truckers may not be part of the shipper-carrier negotiated service contract, although 

those terms might appear in the VOCC’s ocean tariff.

15

 
a motor carrier. The VOCC’s tariff rates and practices may also directly pass 

through or refer to those of the relevant port authority’s or MTO’s schedule. 

Demurrage on merchant haulage is invariably assessed “for the account of 

the cargo,” although it may be paid by the importer’s trucker or customs broker.

16 

In most ports, accrual of demurrage charges must be settled with the MTO prior to 

the release of the container(s). In ports where the MTO invoices the VOCC 

directly and not the trucker, the VOCC invoices demurrage separately. Some 

MTOs allow truckers to set up either credit card payment or may extend credit to 

them to be paid weekly or monthly. The MTO reports to the VOCC, usually on a 

monthly basis, what it has collected, less the agreed-upon collection fee, and remits

the balance of demurrage it has collected to the VOCC.17 

16 It appears that drayage truckers commonly may be required to pay “line demurrage” before an 

import container is released by the VOCC, even on carrier haulage.

17 See, e.g., APM Terminals Pacific, Ltd., Port of Los Angeles Pier 400 – Terminal Tariff Item 

No. 710: “If requested by carrier, APMT will manage, administer and collect carrier’s inbound 

demurrage. APMT will reimburse to carrier 100 percent of collected carrier’s inbound 

demurrage less terminal demurrage and an administration fee of 15 percent of the difference 

between the collected carrier’s demurrage and terminal demurrage.” Landlord port authorities 

(Los Angeles, Long Beach, Seattle, Tacoma and New York/New Jersey) lease their owned 

facilities to MTOs who operate them and the terms of those leases may include minimum 

throughput guarantees or incentives for additional throughput over a minimum amount. Tenant 

MTOs execute “berthing agreements” with VOCCs which include fees for services. At terminals 

operated by Port Authorities (“operating ports”) (Virginia, South Carolina, Georgia, Houston), 

nominal demurrage rates are charged to the VOCC and the VOCC marks these up to the cargo 

16

 
The measure for free time for import demurrage is typically the time 

between when the container is discharged from the vessel to the time the container 

leaves the terminal (is “out-gated”). Otherwise, the free time period ends at an 

appointed time on the LFD, and demurrage charges will begin to accrue.18 

Many port authority schedules or ordinances include authority for the 

executive director to extend free time for demurrage in certain situations. Free 

time for demurrage may also be extended by the terminal operator19 or by the 

VOCC.

interest. These operating ports charge VOCCs for each container based on overall volume 

(“throughput”), as well as wharfage, dockage, demurrage and, in Virginia, chassis. These types 

of agreements (terminal leases and berthing agreements) are subject to the Commission’s 

jurisdiction, but have been exempted from filing. See 46 C.F.R. §§ 535.309, 535.310. 

18 As with commencement of free time, expiration of free time varies by VOCC, terminal and 

port. For example, APM Terminals operating Pier 400 at the Port of Los Angeles requires that

free time expires at 5:00pm on the last free day. APM Terminals Pacific, Ltd, Port of Los 

Angeles Pier 400, Marine Terminal Operator Rate Schedule, Section 7, Free Time, Wharf 

Demurrage and Wharf Storage, Item No. 710, “Free Time Allowed.” 

19 See, e.g., New York Terminal Conference, Section IV, paragraph 8, “In the event the 

consignee or owner of the cargo should make application for delivery of the cargo...during the 

free time and NYTC should be unable for any reason to make available to the consignee or 

owner of such cargo..., the free time shall be extended for a period equal to the duration of 

NYTC’s inability to make the cargo available.” If a terminal subject to the NYCT schedule is 

open fifty percent of the day, this day will be considered a full service day. Id.

17

 
A review of MTO schedules20 reveals some common policies. MTO and 

port authority schedules indicate that demurrage charges may be invoiced to the 

VOCC (which, in turn, invoices the consignee), but are invariably “for the account 

of the cargo.” They are generally collected by the MTO on behalf of the VOCC 

and usually on the terms the VOCC instructs. This is true whether the movement 

is through carriage (i.e., “carrier haulage” or “store door” delivery), in which the 

ocean carrier is responsible for the drayage from the terminal to the consignee, or 

“merchant haulage,” in which the shipper must make arrangements for the drayage 

of the cargo from the terminal. In either case, in an import move, the cargo interest 

will generally be responsible for any demurrage accrued while the container was at 

rest at the terminal.

There are exceptions to the application of demurrage fees known sometimes 

as “stop the clock” provisions. CMA CGM’s tariff, for example, includes this

“Port/CY Tie up” provision: “If the consignee is prevented from removing the 

containers from the Port/CY by factors beyond his control, such as, but not limited 

to, labor strikes, trucking strikes, or weather conditions which affect the entire 

Port/CY area or a substantial portion thereof: free time and demurrage will be 

20 These include private marine terminal operators and public port authorities.

18

 
calculated and demurrage assessed as follows...” CMA CGM, CMDU-100 U.S. 

Unified Tariff, Rule 100 – Import Demurrage Rules. CMA CGM’s rules, as do 

others, also allow for additional free time for delays that are a result of the carrier’s 

inability to deliver the cargo within free time, but specifically does not pertain to 

“issues related to customer’s inability to receive cargo or the absence of a full 

release.” Id. Similarly, COSCO’s tariff rules account for the carrier’s inability to 

deliver: “When the carrier is for any reason unable to tender cargo for delivery 

during the free time, free time will be extended for a period equal to the duration of 

the carrier’s inability to tender the cargo. If such condition arises after the 

expiration of free time, no demurrage . . .will be charged for a period equal to the 

duration of the Carrier’s inability to tender the cargo.” COSCO tariff, Far East to 

U.S.A. Tariff No. 201, Free Time/Demurrage at Destination U.S.A., Number 023-

B (effective November 22, 2014).

Detention

Detention is a charge assessed by the VOCC to the shipper for the use of its 

equipment (for the purposes of this report, limited to containers) after the 

19
expiration of free time.21 Detention for imports generally begins when the 

importer picks up the container from the terminal (or the cargo is “delivered” 

depending on the VOCC terms) and ends when the container is returned empty to 

the place instructed by the VOCC. Detention for exports begins when the exporter 

picks up a container from the VOCC’s facility and ends when the exporter presents 

the loaded container for export at the terminal.

As a matter of policy historically, “[d]etention charges have a double 

purpose, one of which is for the use of a car, ship or vehicle. The other is to 

promote efficiency in the operation.” Am. Exp.-Isbrandtsen Lines, Inc. v. Fed. 

Mar. Comm'n, 444 F.2d 824, 829 (D.C. Cir. 1970) (citing Turner, Dennis & 

Lowry Lumber Co. v. C., M. & St. P. Ry., 271 U.S. 259, 262 (1926)); see also, 

Docket No. 68-9, Free Time and Demurrage Practices on Export Cargo, 13 

F.M.C. 207, 211 (1970).

DISCUSSION

21 See, National Customs Brokers and Forwarders Association of America’s Ocean Freight 

Forwarder Certification Program, Study Guide ver. 1, Part II – Glossary, page II-69 (1996).

20

 
The MTO congestion the Commission had noted in 2014 at certain ports has 

recently become even more acute. Operationally, it appears that congestion begets 

further congestion, which in turn may result in higher costs for everyone in the 

supply chain. When MTOs are forced to stack equipment higher and tighter to 

address terminal space issues, containers may be buried in hard-to-access stacks 

when a truck driver is attempting to pick up a specific container. Landside 

productivity consequently declines when a crane operator has to move multiple 

containers in order to remove the desired one. Further, truckers complain that 

certain areas at terminals have been restricted or placed off limits; this makes some 

containers unavailable for pick up. VOCCs and MTOs have limited the days and 

shifts during which they will accept the returns of empty containers. Last-minute 

notice from VOCCs and MTOs to truckers, importers and exporters about vesselloading delays, cancelled vessel calls, terminal opening hours, shifts and closed 

areas, have left cargo interests scrambling to pick up their cargo, load their exports 

and return their empties. Rail service providers, for example, report delays have 

reduced the number of trains running from the West Coast to the mid-West by 

half.22 

22 Testimony of Katie Farmer, Vice President for Consumer Products, BNSF, before the Senate 

21

 
Methodology and Sources

For this report we examined the tariff publications of six VOCCs, selected 

chiefly for the size of their market share, Maersk Line, Mediterranean Shipping 

Company, CMA CGM, Evergreen, COSCO,23 and OOCL24 and the public rules of 

the port authorities of Los Angeles, Long Beach, Oakland, New York/New Jersey, 

Tacoma, Seattle, Houston, Georgia, South Carolina and Virginia. Where the 

VOCC tariff refers to the MTO’s terms, we also examined the free time and 

demurrage rules of all the MTOs within those ports (a total of 32),

25 to the extent 

Committee on Commerce, Science and Transportation, Subcommittee on Surface Transportation 

and Merchant Marine Infrastructure, Safety and Security, “Keeping Goods Moving” (February 

10, 2015).

23 COSCO’s tariff did not include demurrage and detention rules for service to Houston; this 

analysis therefore does not include that port for COSCO; references to rates applicable to two 

terminals in Tacoma were also not available, and thus are not included in this analysis. 

24 OOCL was also selected based on its membership in the G6 Alliance, an operational alliance 

of the ocean common carriers American President Lines, Hapag Lloyd, NYK, OOCL, Hyundai 

and Mitsui OSK. FMC Agreement No. 232-012194. 

25 They are: Port of New York/New Jersey – APM Terminals, Port Newark Container Terminal, 

Maher, Global Container Terminal (Bayonne), Global Container Terminal (New York), Red 

Hook Container Terminal; Port of Los Angeles – West Basin Container Terminal (Berth 100), 

West Basin Container Terminal Berth 121), TRAPAC, Yusen Terminal, Inc., Eagle Container 

Terminal, APL Terminals, APM Terminals, California United Terminals, Total Terminals, Inc., 

International Stevedoring Services; Port of Long Beach – Long Beach Container Terminal, PCT, 

SSA(A), SSA (C); Port of Seattle - SSA18, SSA30, TTI; Port of Tacoma – Olympic Container 

Terminal, Husky Container Terminal, APM, Washington United Terminal, PCT; Port of 

Oakland – SSA, Ports America Outer Harbor Terminal, TRAPAC, STS, Matson; Houston Port 

22

 
they were available.26 The MTO schedule of one terminal conference, containing

the terms of five terminals serving New York/New Jersey (the New York Terminal 

Conference), was also examined. Appendix B organizes and compares the data.

Price comparison: Imports and Exports

Using data collected for this report, we can make some initial, general 

observations about the demurrage and detention prices for imports and those for 

exports. Average daily prices for these fees combined are higher for imports than 

they are for exports. For importers, terminal congestion results in additional delays 

between the time a container is available for pickup (released) and when the 

drayman can pick up the container. Demurrage charges for the account of the 

cargo now appear largely to be collected by MTOs, but according to VOCCs 

Authority – Barbour’s Cut, Bayport; Virginia International Terminals; South Carolina State Port 

Authority; Georgia Port Authority.

26 The Commission amended its regulations for MTO schedules in 1999 following the adoption 

of the Ocean Shipping Reform Act (OSRA), 46 CFR Part 535. FMC Docket No. 98-27, Marine 

Terminal Operator Schedules (63 Fed. Reg. 69604-69606 (proposed rule)(Dec. 17, 1998) and 64 

Fed. Reg. 9281 (Final Rule)(Feb. 25, 1999). OSRA relieved MTOs from the requirements to file 

and adhere to tariffs but made provisions for the Commission’s continued regulation of MTO 

schedules, when MTOs choose to publish them. The Commission’s rules at 46 CFR section 

525.3(f) require MTOs to report to the FMC through the filing of an FMC-1. The Commission 

in turn publishes the location of such MTO schedules on the FMC webpage at 

https://www2.fmc.gov/FMC1Users/scripts/ExtReports.asp?tariffClass=mto.

23

 
terms.27 It appears that there is no generally used formula to determine when the 

normal allowance for free time might be increased or reduced. Even with the 

current congestion, while perhaps temporary, staff has not observed increases in 

free time in VOCCs’ tariff terms or MTO schedules. Many shippers have reported, 

however, that VOCCs have waived or reduced fees or increased free time when 

there are delays clearly attributable to terminal congestion that are not the fault of 

the cargo interest.

With respect to detention, importers are negatively affected when their 

ability to return empty containers and other equipment to carriers is impaired and

the equipment free time is not correspondingly increased. The National Industrial 

Transportation League (NITL) requested that MTOs and VOCCs put a moratorium 

on all demurrage and detention charges until the terminal congestion ceased at 

West Coast Ports. Importers invariably feel this is unfair and frequently express a 

sense of powerlessness, as they have no direct commercial relationship with the 

27 See, e.g., APM Terminals – Los Angeles Pier 500 – Terminal Tariff, Item No. 710: “...If 

requested by carrier, APM Terminals will manage, administer and collect carrier’s inbound 

demurrage.” MTOs themselves do not waive free time for demurrage. See also id., Item No. 

715: “When Carrier or consignee is prevented from removing cargo from the terminal beyond 

APM Terminals’ control, such as, but not limited to, longshoremen’s strikes, trucking strikes or 

weather conditions . . . containers which remain at the terminal beyond the designated free time 

shall remain subject to the demurrage charges in accordance with this rule.”

24

 
MTOs to negotiate free time and observe that VOCC free time terms reflect MTO 

free time terms. Importers who move their cargo under service contract appear to 

have the ability to negotiate terms with the VOCCs that would address declines in 

terminal handling velocity with corresponding increases in demurrage and 

detention free time but, to date have not negotiated these charges. This may be 

because truckers have been willing to absorb28 any temporary additional costs 

rather than passing them through to their importer customers. It also could be 

because no standard measures of terminal velocity exist or because MTOs and 

drayage truckers have different opinions on how to measure terminal gate 

productivity. From the VOCC’s perspective, the free time negotiated with MTOs 

may sometimes be based on throughput. Of course, delays at the terminals result 

in additional dwell time for VOCCs’ equipment. Importers frequently argue that 

VOCCs are in a better position to demand greater velocity from MTOs than are 

28 It is unclear whether the recent severe decline in the price of fuel facilitated drayage operators’ 

willingness to absorb these charges. More recently there have been anecdotal reports of truckers 

charging their own “congestion fees” when their drivers are forced to wait long hours in queues 

outside the marine terminal gates.

25

 
importers, although, they claim, it is the importer who will bear the costs of delays 

at the terminal.29

Importers and their agents have complained that there is confusion about 

who should be responsible for delays at the terminal or delays returning equipment 

to the terminal. This especially has been the case with the current extraordinary 

congestion on the West Coast and on the East Coast, where exceptional weatherrelated closings and delays due to winter storms have been experienced. Cargo 

interests and truckers on the West Coast argue that the VOCCs and the MTOs are 

responsible for ordering adequate labor for ensuring cargo moves according to 

their established free time. They argue that, if VOCCs and MTOs do not secure 

adequate labor to move containers, VOCCs and MTOs should increase free time to 

reflect the delays they have caused. VOCCs and MTOs may argue that they are 

not the cause of the slow downs, and, at least for VOCCs, their own vessel 

operating costs have increased due to the delays. As a result of a slowdown in 

processing truckers within the terminal, truckers or BCOs may incur significant 

demurrage costs when they are unable to make sufficient turns (i.e., pick ups and 

29 There have been recent reports of importers attempting to recoup detention (and per diem) 

charges by billing the VOCC for storage of the VOCC’s empty containers at the importers’ 

warehouse.

26

 
drop offs) on a daily basis. This results in corresponding detention charges as 

congested terminals sometimes limit or restrict the return of empty containers. 

With respect to detention, opportunity costs to the VOCC of its equipment that 

remains in importers’ control past the free days does not change because of delays. 

Anecdotally, too, VOCCs have waived or reduced detention charges when 

importers have shown their inability to return the equipment was caused by the 

VOCC’s own direction to an MTO for reduction in hours during which the 

equipment could be returned.

For exporters, failure by MTOs and VOCCs to increase demurrage and 

detention free time when there are delays at terminals that result in vessel loading 

delays or vessel call cancellations and rolled bookings cause demurrage and 

detention expenses.30 Additional demurrage costs for exporters may arise in 

“rolled booking” fees, and detention when they hold a container longer than the 

applicable free time. Carrier’s tariff rules may allow for rolled booking storage, 

but the terms controlling how far in advance the carrier must inform the shipper of 

the rolled booking may not meet the time constraints of certain exporters 

30 But see, COSCO Tariff 203, Cargo Free Time/Demurrage at Origin Ports, Rule No. 023-A, 

“Cargo shut out” (effective May 11, 2014), extending free time for rolled cargo due to 

overbooking.

27

 
delivering cargo assembled or loaded far away from the marine terminal, as is the 

case with many agricultural exporters in the Western United States.

Both exporters and importers experience additional external costs when 

cargo and equipment does not move efficiently through the terminals or when 

vessel calls are cancelled or delayed. Most commonly, these expenses are related 

to additional trucking, labor, and storage. For truckers, additional expenses 

relating to delays arise from labor and fuel costs. Shippers invariably feel these 

additional costs are more than enough to bear without also having to bear 

additional costs of demurrage and detention for slowdowns outside their control, 

but arguably within the control of those entities charging them for delays. 

28
Price comparison: Demurrage and Detention

Recently, importers complain that they cannot timely return empty 

containers to the terminal as instructed by the carrier because there are reduced 

service hours at the ports for the return of empty containers and free time for 

detention has not been extended to reflect those reduced service hours. Detention 

is usually calculated on a calendar day (or fraction) basis; free time is generally 

extended for the time equivalent to a terminal shutdown only while containers are 

still in free time. A comparison of the combined import/export average prices for 

demurrage with those for detention, however, reveals that the average daily costs 

for demurrage is higher.

Shippers on the East Coast complain that the one-for-one extension of free 

time days after a terminal is closed for weather, for example, is inadequate because 

it may take longer to return the terminal to normal productivity after a closure than 

the closure itself. It appears that, because of the generally higher daily charge, a 

decrease in demurrage fees, or increase in demurrage free time, would have greater 

overall impact than changes in detention prices and practices.

Price comparison: Ports

29
Comparing combined demurrage and detention prices across all the ports

examined in this report, it appears shippers moving cargo through terminals in 

New York/New Jersey pay the highest average price. For terminals other than 

those at New York/New Jersey, prices are, on average, similar. These prices were 

derived from VOCC’s tariffs, which in turn may reflect the prices in the terminals’ 

schedules.

Price comparison: VOCCs

Comparing VOCCs across all the ports they serve indicates carriers’

individual prices for detention charges are generally the same regardless of port of 

loading or discharge, and generally the same for imports or exports. Comparing 

VOCCs demurrage charges at ports vary widely. For purposes of illustration, we 

compared the charges that would be incurred on a hypothetical import container 

delayed for six days across the six VOCC tariffs. Similarly, the fees that would be 

incurred by a hypothetical container kept by the importer for 12 days was also 

examined. Attachment B.

POSSIBLE ACTION

30
The following section discusses different options for addressing demurrage

and detention by VOCCs, MTOs, port authorities, BCOs and their truckers, as well 

as the Commission.

Possible actions by VOCCs

Carriers may “stop the clock,” waive, reduce or compromise fees relating to 

congestion if they have the flexibility to do so under their tariff or service 

contract.

31 Some carriers’ tariffs provide for extensions of free time for delays in 

cargo availability due to carrier’s error or carrier’s inability to tender the cargo. 32

It seems carriers vary widely by customer and by situation as to whether 

they will waive or reduce demurrage and detention charges where they are able to 

tender the cargo, but have experienced delays due to terminal unproductivity. It 

31 Maersk Line, Demurrage – World (Excluding OFAC Countries) to United States, Note 6 

(effective November 22, 2014) states, “Demurrage will not be assessed on shipments if incurred 

due to carrier’s error.” Maersk will “stop the clock” on detention and per diem for store door 

and drop and pick when consignees notify Maersk in writing. Maersk Line, Detention – United 

States to/from World – Detention/Per Diem – United States to/from World (effective November 

30, 2014). See also, CMA CGM’s “port/cy tie up” and “carrier inability” provisions for import 

demurrage. CMA CGM’s tariff also has special provisions extending free time for detention at 

Oakland and Long Beach for ship loading delays. COSCO’s tariff provides for “carrier inability 

to tender cargo.” See COSCO Tariff 201 – Free Time/Demurrage at Destination USA Rule No. 

023-B (effective November 22, 2014).

32 The Shipping Act requires common carriers to abide by their published tariff rules or filed 

service contract terms. 46 U.S.C § 41104.

31

 
may be that VOCCs once willing to interpret these free time extensions liberally 

are no longer willing to do so. Wide variation in carriers’ willingness to waive, or 

even consider reducing, these fees has been observed. VOCCs have indicated that 

proper documentation is needed for a waiver to be considered.

With respect to the charges to which cargo interests are accountable, and the 

subject of this report, VOCCs are unlikely to take action to reduce their collections 

of these fees unilaterally. Carriers undoubtedly have costs relating to the delays in 

their vessel operations. One carrier skipping calls at Oakland reportedly has

absorbed the additional rail costs to move the shipments that were to be delivered 

there. Other carriers skipping calls at Oakland may declare force majeure in order 

to avoid those costs; importers will bear additional unanticipated costs of 

recovering their shipments at a termination point they did not expect. The 

additional detention costs on these containers are unlikely to be reduced by the 

carrier. Shippers have made assertions that detention charges, rather than 

representing recovery of costs associated with the use of equipment, have become 

revenue centers for the carriers. We have no information that would either confirm 

or disprove this assertion. 

Whether they waive these fees or not, however, it may be reasonable to 

expect that VOCCs will act to minimize their own costs resulting from terminal 

32
delays. For example, alliances of VOCCs may consolidate terminal operations and 

reduce the number of terminals serving their vessels in southern California. In the 

short term, this may cause additional congestion at the remaining terminals serving 

the vessels of those operators. Some observers assert better blockage and stowage 

on vessels bringing imports from Asia should be done so that receiving terminals 

can more efficiently organize those containers for collection by drayage providers. 

It has been observed, although not by the VOCCs themselves, that better preplanning, blockage and stowage on the vessel, as well as vessel scheduling and 

regular vessel traffic information and forecasts may improve the MTOs ability to 

expedite the import shipments as they are unloaded. This type of operational 

improvement may be achieved as alliances integrate their shared vessel strings. 

The operators participating in those alliances are in the best position to make 

decisions on how their operations can be better integrated for efficiency and where 

that cannot be done for other operational and non-operational reasons. 

Possible actions by MTOs

Those MTOs who are members of an FMC-filed-and-effective agreement 

can make increasing use of their ability to address congestion collectively and thus 

33
reduce costs. In addition, they can individually improve technology for gate 

operations, through systems such as NAVIS, eModal33 and FRATIS systems,34 for 

example, as well as improve communications with drayage providers and 

importers. All this, of course, may require additional capital contributions as well 

as the agreement of shore-side labor. MTOs could extend their own free time for 

demurrage; this may drive VOCCs to reflect the additional free time in their tariffs,

but it may not necessarily be the case.

Possible actions by port authorities

Port authorities, both landlord and operating ports, continue to publish 

terminal schedules. It appears they may consider, either individually or 

collectively through agreements filed with the Federal Maritime Commission (such 

as the California Association of Port Authorities), adding requirements for terminal 

productivity, incentives or measurements of terminal productivity that include 

container velocity from dock to gate (i.e., dwell time). Some public port 

33 NAVIS and EModal are software solutions for terminal gate appointment and other terminal 

management needs. See, e.g, http://www.emodal.com/anondefault.aspx?ReturnUrl=%2f

34 FRATIS is the Department of Transportation, Federal Highways Administration’s Freight 

Advanced Traveler Information System. See, http://www.camsys.com/kb_cases_FRATIS.htm

34

 
authorities may determine they lack adequate current authority to unilaterally 

extend demurrage free time. Doing so would have reduced the demurrage charges 

collected by MTOs on behalf of VOCCs; it would not have appeared to have any 

impact on detention fees.

Some port authorities are taking steps to do what they can to relieve 

congestion: offering lots for the storage of empties; purchasing chassis and 

creating pools; adding required infrastructure improvements; and exploring how 

information technology can help stakeholders share shipment and location 

information to improve velocity in terminals. They also fund and advocate for 

infrastructure improvements that can improve terminal operations and the flow of 

cargo on and off the terminal. Port authorities have been reaching out to their 

stakeholders for input. 

35
Possible actions by BCOs and truckers

BCOs and truckers that are unhappy with the rates, rules, and practices of 

VOCCs and MTOs can seek to change them through: requests for assistance of 

CADRS in informal mediation; litigation before the FMC; petitioning the 

Commission for declaratory orders or rulemakings; or litigation in state or federal 

court, possibly asserting contractual claims such as excusable non-performance 

under the contract due to force majeure, impossibility, or frustration. Many 

shippers, ocean transportation intermediaries and truckers are contacting CADRS 

to request assistance mediating disputes relating to demurrage and detention 

charges. It appears that motor carriers whose relationships with VOCCs and others 

as “equipment providers” are subject to the terms of a UIIA amendment, must 

challenge these rates, rules, and practices through the arbitration process governed 

by the UIIA.

After the adoption of the Ocean Shipping Reform Act and Congressional 

instruction that the Commission rely more on complaints to address violations of 

the Shipping Act, the FMC has addressed matters, such as whether the particular 

application of a charge violates a provision of the Shipping Act in adjudicatory 

proceedings. These individual complainants seeking reparations are responsible 

for presenting evidence to support their allegations of Shipping Act violations.

36
Possible action by the Federal Maritime Commission

The Commission has tools that may be available to it to acquire additional 

information and to examine and address additional concerns relating to free time, 

detention, and demurrage practices of VOCCs, MTOs and port authorities. It may 

initiate these either in response to a public petition or on its own initiative after 

reviewing public information and information compiled by staff and gathered from 

information already in its possession (or, in response to Commission-issued orders 

directing VOCCs, their agents and employees to submit certain information or 

special reports). 

Federal Advisory Committee

The Commission could explore whether it should establish an Advisory 

Committee, subject to the requirements of the Federal Advisory Committee Act, to 

provide it with non-binding recommendations on how the agency should address 

the reported problems with demurrage and detention. We note that the Department 

of Commerce’s Supply Chain Competitiveness Advisory Committee has discussed 

port congestion at its last semi-annual meeting held in January, 2015 and it is likely 

to be studying the issue as well. Its mission is to advise the International Trade 

Administration (ITA) on actions that agency should take. It is also possible that 

37
the Department of Transportation’s (DOT) Freight Advisory Committee may make 

recommendations to that agency on the matter. It appears these advisory 

committees will address intermodal transportation congestion generally. They 

appear unlikely, however, to recommend DOT or ITA action relating specifically 

to MTO and VOCC demurrage and detention rates, rules, and practices. Should 

the Commission determine to establish a Federal Advisory Committee, the 

Commission could direct it to offer suggestions for the Commission’s regulation of 

MTO and VOCC demurrage and detention rates, rules, and practices.

Special Reporting Requirements

Under the appropriate circumstances, the Commission could seek special 

reporting from certain filed agreements. 46 C.F.R. § 535.702 (d). The 

Commission could direct the staff to draft special reporting requirements for its 

consideration pursuant to its regulatory authority on filed agreements of VOCCs

and MTOs directing them to submit additional data and information related to 

demurrage, detention, and free time issues involved in the agreement. This may be 

one manner, for example, to determine whether there may be any factual support 

for the allegation that these charges have become unreasonable revenue sources for 

VOCCs. 

38
Section 15 Orders

Section 15 of the Shipping Act provides the Commission the authority to 

order common carriers and their employees and agents to report on a matter 

germane to the Commission’s regulation. 46 U.S.C. § 40104. The authority of the 

Commission to use such orders to gather information is broad and has been used in 

the past to gather information on a variety of policies. The Act gives the 

Commission the authority to keep responses to these orders confidential.

Order of Investigation and Hearing – Adjudicatory Proceeding

The Commission may initiate an adjudicatory proceeding through the 

issuance of an Order of Investigation and Hearing under 46 U.S.C. § 41302. The 

presiding officer would adjudicate the alleged Shipping Act violations related to 

free time, demurrage, and detention practices of one or more VOCCs or MTOs. 

The Commission’s Bureau of Enforcement would be a party to the proceeding. 46 

C.F.R. § 502.63. For example, an Order of Investigation and Hearing might 

39
address whether the free time and demurrage practices of a particular MTO or 

VOCC violate the Shipping Act.35

To initiate such a proceeding, the Commission should have evidence or credible 

allegations of a violation of a provision of the Shipping Act and harm that has 

occurred because of that violation. See 46 C.F.R. § 502.63(b) (identifying the 

required contents of orders of investigation). These investigations provide for 

discovery, including interrogatories, production of documents, depositions, and 

issuance of subpoenas by the presiding officer.

Petitions to the Commission

Rule 76 of the Commission’s Rules of Practice and Procedure (46 C.F.R. § 

502.76) provides that the public may file petitions with the Commission seeking 

relief or affirmative action by the Commission. Strictly speaking, these are not 

35 The Commission could examine a particular MTO tariff term such as: “When Carrier or 

consignee is prevented from removing cargo from the terminal by factors beyond the terminal’s

control, such as, but not limited to, longshoremen’s strikes, trucking strikes or weather 

conditions which affect the entire port area or a substantial portion thereof, Containers which 

remain at the terminal beyond the designated free time shall remain subject to the demurrage 

charges in accordance with this rule.” It should also be pointed out, however, that because 

MTOs for the most part defer to the VOCCs with respect to charging demurrage, finding this 

provision to be unreasonable may have no direct effect on preventing the continued collection of 

demurrage.

40

 
Commission-initiated proceedings, but the Commission would be the ultimate 

arbiter on whether to entertain the petition or grant relief. For example, in 2002, 

Bi-State Motor Carriers filed a petition alleging the New York Terminal 

Conference’s rules violated section 10(d)(1) of the Act as amended by the Ocean 

Shipping Reform Act because they avoided fair calculation of truck detention 

penalties that compensate truckers for excessive waiting time at the terminal. 

Docket No. P3-02, Petition of the Association of Bi-State Motor Carriers, Inc. to 

Investigate Truck Detention Practices of the New York Terminal Conference at the 

New York/New Jersey Port District, 30 S.R.R. 104 (February 20, 2004). The 

Commission denied Bi-State’s petition, finding the petitioner relied only on past 

assertions of congestion and did not present any probative evidence on why 

current truck detention practices should be considered unreasonable. The FMC 

also found Bi-State had failed to demonstrate how the rules were useful in 

addressing port congestion, why the FMC was better suited than local authorities to 

address and resolve delays, and how the Port continued to suffer from unique 

circumstances which would distinguish it from other large ports. Id.

41
Order of Investigation – Non-Adjudicatory Fact Finding

The Commission has turned to non-adjudicatory investigations (fact-finding) 

proceedings, invoking the regulations at 46 C.F.R. Part 502 Subpart R, to 

investigate policies and practices of regulated entities (such as agreements among 

common carriers, household goods intermediaries, vessel operators and equipment 

providers) on a wide range of alleged violations (e.g., discrimination, unreasonable 

practices, anti-competitive practices). The Commission can direct the appointed 

fact-finding officer to present findings and recommendations for Commission 

action (rulemaking or adjudication) on a discrete issue.36

Rulemaking

If the Commission were to initiate an adjudicatory proceeding or a nonadjudicatory fact-finding, or require special reporting requirements, the final result

of these approaches may be the Commission’s issuance of an adjudicatory order or 

the initiation of a notice and comment or negotiated rulemaking. They may also 

result in no Commission action.

36 See, e.g., Docket No. 68-9, Free Time and Demurrage Charges on Export Cargo, 13 F.M.C. 

207 (1970) (discussing Fact-Finding Investigation No. 4 (1963) (effect of free storage on export 

cargo at the Port of New York)).

42

 
The Commission may initiate a rulemaking proceeding to explore whether it 

should issue generally-applicable rules to address widespread practices that it has 

determined violate the Shipping Act. This may be initiated as a result of findings 

made in a non-adjudicatory fact-finding or the issuance of a Notice of Inquiry, 

requesting the public to submit comments, suggestions, and evidence. 

Alternatively, the Commission can issue a notice of proposed rulemaking, or 

initiate a negotiated rulemaking, which would include an identification of the issue 

the Commission seeks to address, articulating its authority to do so, and providing 

a burden/cost estimate of the proposal.

The last time the Commission was petitioned to address MTO practices at 

one terminal complex it declined to do so, finding that the evidence presented was 

not persuasive that the congestion or delays that existed in New York were unique 

to that port complex or that they could be remedied by Commission action. See, 

Docket No. P3-02, Petition of the Association of Bi-State Motor Carriers, Inc. to 

Investigate Truck Detention Practices of the New York Terminal Conference at the 

New York/New Jersey Port District, 30 S.R.R. 104 (February 20, 2004) (FMC 

order denying petition).

Ombudsman

43
The Commission could direct the Director of CADRS, who also serves as 

the agency’s Ombudsman,37 to facilitate targeted meetings and listening sessions

with the industry and to develop findings and recommendations for the 

Commission and industry as a whole. Unlike a fact-finding officer, however, the 

Ombudsman has no authority to compel participation.

CONCLUSION

U.S. importers and exporters have expressed their belief that the demurrage 

and detention practices of MTOs and VOCCs are unfair. One shipper has told 

Commission staff that it has paid over $100,000 in demurrage charges in the last 

year, as compared to paying approximately $10,000 for the previous year. This 

disparity highlights shippers’ perceptions that demurrage charges are not serving to 

speed the movement of cargo, the purpose for which those charges had originally 

been intended. Shippers feel they are in a “catch-22” when they are not permitted 

to pick up their container because of MTO congestion, and yet are charged 

demurrage. Similarly, normal free-time periods may become insufficient when the 

MTO is unable or unwilling to provide shippers access to their cargo.

37 46 C.F.R. § 501.5(k).

44

 
The Commission has made no determinations with respect to the application 

of demurrage and detention, or about the courses of action that it may take. The 

Commission has a variety of actions that could be used to address issues provided 

there is a sufficient factual basis to support the action. As indicated above, those 

actions include: 

• the establishment of an Advisory Committee under the Federal 

Advisory Committee Act;

• the imposition of special reporting requirements on filed agreements;

• the requirement for filing special reports by common carriers pursuant 

to Section 15 of the Shipping Act; 

• the initiation of a docketed proceeding for adjudication through an 

order of investigation; 

• the grant of review of a petition with the Commission for specific 

action, if such a petition were appropriately presented by a party;

• the initiation of a non-adjudicatory fact-finding; 

• the initiation of a rulemaking proceeding; 

• or direction to the agency’s Ombudsman to undertake focused 

facilitative meetings with industry.

45
In the absence of documented facts that provide a basis for the Commission 

to take action, issues regarding application of demurrage and detention charges 

will continue to be reviewed as part of the broader examination of port congestion.

46
Appendix A

I. Vessel-operating Common Carrier Tariff Publications

Maersk Line

Maersk Line – Demurrage – World (Excluding OFAC Countries to United States)

Demurrage – World (Excluding Sudan, Syria and Cuba) to United States

Effective from 22 November, 2014

Maersk tariff Detention - United States to/from World; Detention/Per Diem -

United States to/from World

Effective November 30, 2014

Maersk tariff - Demurrage - USA To World; Demurrage: United States to World

Effective Date: October 18, 2014

Maersk tariff Detention - United States to/from World; Detention/Per Diem -

United States to/from World

Mediterranean Shipping Company S.A.

Tariff: MSC Governing Rules Tariff FMC 12 (MESU-012)

MSC Governing Rules Tariff FMC 12 (MESU-012) tariff Demurrage/Storage –

Detention – Per Diem – USA & Puerto Rico (106)(effective 8/7/2014); MSC Far 

East EB (to USA) & WB (from USA) Freight Tariff & Rules (MESU032)(Descartes) - Demurrage/Storage – Detention – Per Diem – USA & Puerto 

Rico (105)

Rule: Demurrage on Intermodal Shipments (100)

Effective 09Oct 2011

Rule: Demurrage/Storage – Detention – Per Diem – USA & Puerto Rico (106)

Assessorial: Demurrage/Storage – Detention – Per Diem

Effective 07 August 2014

Tariff: MSC Far East EB (to USA) Freight Tariff & Rules (MESU -032)

Rule: Demurrage/Storage – Detention – Per Diem – USA & Puerto Rico (105)

Assessorial: Demurrage/Storage – Detention – Per Diem

Effective 15 November 2014
CMA CGM

CMDU-100 U.S. Unified Tariff; Rule 100 – Import Demurrage Rules

Effective 23 April 2014

Ratebase.net (tariff publisher)

CMDU-100 U.S. Unified Tariff

Rule 300 – Addendum to the Uniform Intermodal Interchange and Facilities 

Access Agreement (U.S. Detention)

Effective 23 April 2014

Ratebase.net (tariff publisher)

CMDU-100 U.S. Unified Tariff

Rule 200 – Export Demurrage Rules

Effective 23 April 2014

Ratebase.net (tariff publisher)

CMDU-100 U.S. Unified Tariff

Rule 300 – Addendum to the Uniform Intermodal Interchange and Facilities 

Access Agreement (U.S. Detention)

Effective 23 April 2014

Ratebase.net (tariff publisher)

COSCO

Tariff: 201 (Far East to USA)

Rule: Free Time/Demurrage at Destination USA

Rule Number: 023-B

Effective: 22 November 2014

(www.coscon.com)

Tariff: 201 (Far East to USA)

Rule: Free Time/Detention under Drop and Pull Service

Rule Number: 021-A

Effective: 01 January 2015 

Rule: Addendum to the Uniform Intermodal Interchange and Facilities 

[Agreement]

Rule Number: 021-003

Effective: 01 November 2013

Tariff: 203 (USA to Far East)

Rule: Cargo Free Time/Demurrage at Origin Ports

Number 023-A

Effective: 11 May 2014

Tariff: 203 (USA to Far East) 
Rule: Equipment Free Time/Detention at Origin (Drop N Pull)

Number 021-A

Effective: 01 July 2013

Evergreen Line Joint Service Agreement

Tariff: 601/Equipment Interchange and Demurrage Tariff

Rule: 036-E01 / Demurrage & Detention for POL from USA & Puerto Rico

Effective: 15 October 2014

Shipmentlink (tariff publisher)

Tariff: 601 / General Rules Tariffs for All Trades (Rules + B/L + Equipment)

Rule: 021-005 / Evergreen Shipping Agency (America) Corporation Addendum 

(UIIA)

Effective: 01 May 2014

Rule: 036-I01 / Demurrage & Detention for POD in USA & Puerto Rico

Effective: 15 October 2014

Orient Overseas Container Line Limited 

Overseas Orient Container Line Limited, Eastbound Freight Tariff FMC-0003, 

OOLL - 001 Rule No. 109 Free Time and Demurrage

Overseas Orient Container Line Limited - OOLL - EIA Tariff No. 053 (OOLL053) Appendix A Schedule of Charges (21-05)

Effective: 02 July 2014

Overseas Orient Container Line Limited - OOLL - Westbound Tariff No. OOLL002 - Rule 23 E

Overseas Orient Container Line Limited - OOLL - EIA Tariff No. 053 (OOLL053) Appendix A Schedule of Charges (21-05)

Tariff: FMC-002 Westbound Trans-Pacific

Number: OOLL-002

Effective: 26 September 2005

Rates.etransport.com [URL – self published?]

Rule: 21 A Equipment Freetime/Detention – USA

Effective 02 November 2012

Rule: 21 B – Equipment Freetime/Detention – Destination (General)

Effective 21 May 2008

Rule: 23 E – Cargo Free Time and Demurrage at Origin

Effective: 15 January 2014

Rule 24 – Freetime and Demurrage – Destination

Effective: 23 January 2013
Rule 35 – Combined Demurrage and Detention

Effective 01 February 2015

Tariff FMC – 001 Eastbound Trans-Pacific OOLL-001

Rule 2 29 Store Door Delivery

Effective: 22 January 2015
II. Port Authority Schedules

Port of Los Angeles

Tariff No. 4, Section Seven: Free Time, Wharf Demurrage and Wharf Storage

Effective August 18, 2007

Port of Long Beach

Tariff No. 004

Rule 34-D: Section 4 – Wharf Demurrage, Wharf Storage and Free Time

Effective 12 December 2014

Port of Oakland

The Board of Port Commissioners, Port of Oakland Tariff No. 2-A

Section VIII-A: Wharf Demurrage - Rules and Rates

Section VIII – B: Wharf Storage – Rules and Rates

Effective 1 July, 2007 (and various)

Port of Seattle

Terminals Tariff No. 5

Section Five, Part 1 – Free Time and Wharf Demurrage

Effective 01 January 2015

Port of Tacoma

Terminals Tariff No. 300

Item 657.000 - Storage

Effective: 1 October, 2014

Port of Houston Authority

Tariff No. 14 – Additional Rates, Rules and Regulations Governing the Fentress 

Bracewell Barbours Cut Container Terminal

Subrule No. 093 – Free Time; Demurrage; Booking Roll/Storage Charges

Subrule No. 094 – Loaded Throughput and Empty Handling Charges

Effective: 1 January 2014

Tariff No. 15 – Additional Rates, Rules and Regulations Governing the Bayport 

Container Terminal

Subrule No. 093 – Free Time; Demurrage; Booking Roll/Storage Charges 

Subrule No. 094 – Loaded Throughput and Empty Handling Charges

Effective: 1 January 2014
Virginia International Terminals, LLC

Schedule of Rates No. 1 Governing Charges, Rule and Regulations at Marine 

Terminals operated by Virginia International Terminals, LLC located at the Port of 

Hampton Roads, Virginia, U.S.A.

(C) 456 Free Time – Container

Effective 1 May 2014

(I/C) 461 Terminal Demurrage Charge – Loaded Container

Effective 1 October 2014

Georgia Ports Authority

Gaports.com

Subject: Equipment and Services

Subject: Container Charges for CY Services

South Carolina State Ports Authority

Terminal Tariff No. 8

Rule 34-220 – Free Time, Terminal Demurrage

Effective 23 April 2011

Port Authority of New York and New Jersey

PAMT FMC No. PA-10

Published September 2014
III. Marine Terminal Operator Schedules (or websites)

Maher Terminals LLC (PONYNJ-M)

Maher Terminal Schedule No. 010599 – Naming Rules, Regulations and 

Commodity Rates on Cargo Moving in Containers/Breakbulk

Maher Container Terminal, Port Elizabeth

www.maherteriminals.com

Section III – Export Demurrage

Section IV – Import Demurrage

Effective: 1 October 2014

New York Terminal Conference (participating terminal operators: Red Hook 

Container Terminal, LLC; GCT Bayonne LP; GCT New York LP; Port Newark 

Container Terminal; APM Terminals Elizabeth, LLC)(PONYNJ-GCTB; 

PONYNJ-RH; PONYNJ – APM; PONYNJ – GCTN; PONYNJ-PCT)

Marine Terminal Schedule No. 011408 – Naming Rules, Regulations and

Commodity Rates on Cargo Moving in Containers/Breakbulk

Section III – Export Demurrage

Section IV – Import Demurrage

Effective: 19 February, 2015

APM Terminals Pacific Ltd. (Port of Los Angeles Pier 400)(Tacoma) (POLAAPM; POT-APM)

Marine Terminal Operator Rate Schedule

www.apmterminals-na.com

Section 7 – Free Time, Wharf Demurrage, Wharf Storage

Effective: [access date 2 February 2015]

SSA Marine (A Carrix Enterprise)(Long Beach, Seattle, Oakland)(POLB-SSAT; 

POLB-PCT; POLB-SSAC; POS-SSA18; POS-SSA30; POO-SSA)

Marine Terminal Operator Schedule of Rates, Regulations and Practices

http://www.ssamarine.com

Effective: 19 June 2014

Yusen Terminals Inc., Los Angeles (POLA-YTI)

www.yti.com

Long Beach Container Terminal (POLB-LBCT)

http://www.lbct.com/
STS-LAX Evergreen Terminal (POLA-ECT)

www.vtsocal.com

TraPac (Los Angeles, Oakland) (POLA-TRAPAC)(POO-TRAPAC)

www.trapac.com

West Basin Container Terminal Berth 100 (Los Angeles)(POLA-WBCT100)

www.wbct.us/terminal-services/customer-services

West Basin Container Terminal Berth 121 (Los Angeles)(POLA-WBCT121)

www.wbct.us/terminal-services/customer-services

Husky Terminals (Tacoma)

www.huskyterminal.com

Pierce County Terminal/Evergreen (Tacoma) (POT-PCT)

www.vtnlocal.com

California United Terminal (POLA-CUT)

www.shipcut.com

Ports America Outer Harbor Terminal (Oakland)(POO-PAOHT)

www.portsamerica.com

TTI(Long Beach; Tacoma; Seattle)(POLB-TTI; POT-TTI; POS-TTI)

http://www.ttisea.com/main/index.do

Olympic Container Terminal (Tacoma)(POT-OCT)

http://www.vtnocal.com/default.asp?SiteID=OCT_TAC

Husky (Tacoma)(POT-HUSKY)

http://www.huskyterminal.com/

Washington United Terminals (Tacoma)(POT-WUT)

http://www.uswut.com/

Matson (Oakland)(POO-MATSON)

https://matson.ratebase.net/rateBASE/servlet/loginServlet?user_id=matspass&pass

word=mats01
International Transportation Service (Long Beach)(POLB-ITS)

https://www.itslb.com/Main/Default.aspx

Seaside Transportation Services (Oakland) (POO-STS)

http://www.vtnocal.com/default.asp?SiteID=MTC_OAK
$0

$50

$100

$150

$200

$250

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison of Demurrage Charges by Calculated Day

for Import and Export 20' Dry Containers

Export

Import

$0

$50

$100

$150

$200

$250

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison of Detention Charges by Calculated Day

for Import and Export 20' Dry Containers

Export

Import

Appendix B
$0

$50

$100

$150

$200

$250

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison of Demurrage and Detention Charges

for Export 20' Dry Container

Demurrage

Detention

$0

$50

$100

$150

$200

$250

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison of Demurrage and Detention Charges

for Import 20' Dry Container

Demurrage

Detention
$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison by Port of Demurrage Charges

for Export 20' Dry Container

Georgia

Houston

Los Angeles

Long Beach

NYNJ

Oakland

Seattle

Tacoma

Charleston

Virginia

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison by Port of Demurrage Charges

for Import 20' Dry Container

Georgia

Houston

Los Angeles

Long Beach

NYNJ

Oakland

Seattle

Tacoma

Charleston

Virginia
$0

$20

$40

$60

$80

$100

$120

$140

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison by Port of Detention Charges

for Export 20' Dry Container

Georgia

Houston

Los Angeles

Long Beach

NYNJ

Oakland

Seattle

Tacoma

Charleston

Virginia

$0

$20

$40

$60

$80

$100

$120

$140

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison by Port of Detention Charges

for Import 20' Dry Container

Georgia

Houston

Los Angeles

Long Beach

NYNJ

Oakland

Seattle

Tacoma

Charleston

Virginia
$0

$50

$100

$150

$200

$250

$300

$350

$400

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison by Carrier of Demurrage Charges

for Export 20' Dry Container

CMA CGM

Cosco

Evergreen

Maersk

MSC

OOCL

$0

$50

$100

$150

$200

$250

$300

$350

$400

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison by Carrier of Demurrage Charges

for Import 20' Dry Container

CMA CGM

Cosco

Evergreen

Maersk

MSC

OOCL
$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

$200

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison by Carrier of Detention Charges

for Export 20' Dry Container

CMA CGM

Cosco

Evergreen

Maersk

MSC

OOCL

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

$200

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Calculated Days

Comparison by Carrier of Detention Charges

for Import 20' Dry Container

CMA CGM

Cosco

Evergreen

Maersk

MSC

OOCL
$720

$750

$880

$1,080

Exports, $920

$315

$720

$750

$880

$1,080

Exports, $920

$315

$720

$960

$880

$1,080

Exports, $920

$315

$720

$750

$880

$1,080

Exports, $920

$315

$720

$750

$880

$1,080

Exports, $920

$315

$720

$750

$880

$1,080

Exports, $920

$315

$720

$960

$880

$1,080

Exports, $920

$315

Imports, $840

Imports, $840

Imports, $840

Imports, $840

Imports, $840

Imports, $840

Imports, $840

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

LOS ANGELES LONG BEACH NYNJ OAKLAND SEATTLE TACOMA VIRGINIA

COMPARISON OF DETENTION CHARGES AT DAY 1 2

PER 20' DRY CONTAINER
$350

$200

$240

$450

$50

$200

$350

$200

$240

$450

$50

$200

$430

$398

$428

$525

$296

$207

$175

$100

$120

$450

$50

$100

$175

$100

$120

$450

$50

$100

$175

$100

$120

$450

$50

$100

$175

$100

$120

$450

$50

$100

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

LOS ANGELES LONG BEACH NYNJ OAKLAND SEATTLE TACOMA VIRGINIA

COMPARISON OF IMPORT DEMURRAGE CHARGES AT DAY 6

PER 20' DRY CONTAINER
$160

$53

$0

$0

$0

$100

$160

$0

$0

$0

$0

$100

$200

$179

$214

$0

$207

$207

$160

$0

$0

$0

$0

$100

$160

$20

$0

$0

$20

$100

$160

$0

$0

$0

$0

$100

$160

$0

$0

$0

$0

$100

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

CMA CGM

COSCO

EVERGREEN

MAERSK

MSC

OOCL

LOS ANGELES LONG BEACH NYNJ OAKLAND SEATTLE TACOMA VIRGINIA

COMPARISON OF EXPORT DEMURRAGE CHARGES AT DAY 6

PER 20' DRY CONTAINER