Subcom Report Q2 2023

Fees & Surcharges
Incentive Principle

Demurrage and Detention are valuable charges when applied in 

ways that incentivize cargo interests to move cargo promptly 

from ports and marine terminals... 

...and “when incentives such as demurrage and detention no 

longer function because shippers are prevented from picking up 

cargo or returning containers within time allotted,’’ [absent 

extenuating circumstances], ‘‘charges should be suspended.”
NPRM on D&D Billing

•Detention billing

•Early Return Date (ERD) changes*

•Amended D&D invoices

•Customs Holds*

•30/30/30 Rule

* NSAC Recommendations Submitted
Rail Storage Jurisdiction

Commission Response 

“Any expansion of the FMC’s jurisdiction must be 

legislated by Congress. The Commission has direct jurisdiction 

over common carriers, marine terminal operators (MTO), and 

ocean transportation intermediaries (OTI). This includes 

jurisdiction over ‘through transportation.’ ” 
Rail Storage Jurisdiction – Gray Area

• STB has no authority over contract carriage per Staggers Act

• STB has intermodal exemption per USC 10501 and 10502

• FMC claims jurisdiction on through bills to inland 

destinations over Common Carriers, MTOs, and OTIs but no 

operational authority over other unregulated entities (rail)
Rail Storage Actions

• NCBFAA / NITL / NRF multi-association letter to House 

Transportation and Infrastructure Committee 

- Asks Congress to have FMC change invoice structure for rail 

storage billing back to the ocean carrier that contracted for it.

• Proposed NSAC Comments to D&D Billing NPRM

- Tweaks the definition of demurrage to include all land storage

- Compels rail operators to invoice ocean carriers directly as 

the properly contracted party 
NSAC Proposed Comments

Whereas, NSAC previously corresponded with FMC on the topic of rail 

storage charges (a form of demurrage) by NSAC Recommendation 

dated 5/6/2022, and;

Whereas, the FMC responded to NSAC Recommendation on 

6/30/2022 acknowledging: “The Commission has direct jurisdiction 

over common carriers, marine terminal operators (MTO), and ocean 

transportation intermediaries (OTI). This includes jurisdiction over 

“through transportation.”, and; 
NSAC Proposed Comments

Whereas, the FMC further responded with an example: “An ocean 

carrier that provides a shipper with a through transportation rate 

from Asia to an inland destination in the United States will be 

subject to Commission jurisdiction for the entire through 

transportation...” and; 

Whereas, railroad terminal operators act as agents for 

(emphasizing on behalf of) the ocean carriers who resell their 

services to provide transportation to an inland destination in the 

United States on through-bills of lading, and;
NSAC Proposed Comments

Whereas, through transportation is not completed until the 

container is made available and/or delivered to the motor carrier or 

the store door delivery location, and; 

Whereas, Rail Storage charges are sometimes unreasonably 

assessed to the ocean carrier’s customer directly by rail terminal 

operators, prior to delivery of the container, and without benefit of a 

contract, nor regulatory authority over such rail charges, and;
NSAC Proposed Comments

Whereas, proposed section 541.4 defines a properly issued 

invoice: “...is a demurrage or detention invoice issued by a billing 

party to the person for whose account the billing party provided 

ocean transportation or storage. 

(a) This person must have contracted with the billing party for 

the carriage or storage of goods and is therefore responsible 

for the payment of any incurred demurrage or detention 

charge.

(b) A billing party cannot issue an invoice to any other person.
NSAC Proposed Comments

Therefore, We, the National Shipper Advisory Committee, 

recommend the final rule issued under § 541.3 for Demurrage and 

Detention expands the definition of demurrage or detention to mean 

“...any charges, including “per diem” charges, assessed by or on 

behalf of ocean common carriers, marine terminal operators, or 

non-vessel operating common carriers related to the use of marine

terminal space ( e.g., land) or shipping containers, but not including 

freight charges”. 

Recommended text changes for § 541.3 are the insertion of: ‘or on 

behalf of’, and, striking the word ‘marine’ as above.
Discussion ?
Thank you!