Demurrage charges waived by US Federal Maritime Commission SCO
The December 29th decision to waive over $150,000 in demurrage fees imposed by Taiwan carrier Evergreen for Wisconsin-based forwarder TCW Inc. has set a precedent. The ruling, laid out by a US Federal Maritime Commission small claims officer’s (SCO), was based on a rule that requires these types of charges to only be issued in an effort to prevent carriers from profiteering. This decision now lays out a specific groundwork for the maritime industry - including carriers, chassis owners and terminal operators, that are privy to charging demurrage and detention fees on holidays when containers and chassis are unable to be picked up or dropped off.
In layman ‘s terms: demurrage refers to the charges that are incurred when cargo remains in a container or at a terminal for an extended period of time beyond the allotted free time. Demurrage charges are typically assessed when cargo is not loaded or unloaded within the specified time frame agreed upon by the carrier and the shipper. Demurrage charges are supposed to be intended to compensate the carrier for the use of their equipment and facilities, as well as any additional costs incurred as a result of the extended use. These charges can be significant and can vary depending on the specific circumstances of the shipment.
A recent Texas appeals court decision has declared an 1872 jobs agreement between Palestine, Texas, and Union Pacific to be unenforceable, bringing the railway company closer to its goal of shutting down a rail car shop in the town.