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Regulator to order container detention reports from ocean carriers

Vessel alliances and terminals operating at New York, LA ports subject to demands from Federal Maritime Commission

Container carriers calling at Port of Los Angeles (above) are subject to latest FMC order. (Photo: POLA)

A federal maritime regulator is ordering the world’s largest containership companies to provide her agency with container detention and demurrage information to ensure they’re meeting their legal obligations.

The orders, announced Wednesday by Commissioner Rebecca Dye of the Federal Maritime Commission (FMC), are being issued under Dye’s authority as the fact-finding officer for the FMC’s Fact Finding 29, “International Ocean Transportation Supply Chain Engagement.”

Ocean carriers operating in an alliance and calling at the ports of Los Angeles, Long Beach, or the Port of New York & New Jersey will be subject to the order, according to the FMC, along with marine terminal operators (MTOs) at those ports.

“The demand orders will also require carriers and MTOs to provide information on their policies and practices related to container returns and container availability for exporters,” the FMC stated.

“Failure of carriers and MTOs to operate in a way consistent with the Interpretive Rule on Detention and Demurrage that became effective on May 18, 2020, might constitute a violation of 46 USC 41102(c) which prohibits unjust and unreasonable practices and regulations related to, or connected with, receiving, handling, storing, or delivering property.”

The FMC emphasized that any information it receives could be used as a basis for hearings, enforcement actions or further rulemakings.

The FMC issued Fact Finding 29 in March 2020 when the agency authorized Dye to begin working with representatives from the container-shipping industry to identify “operational solutions to cargo delivery challenges” caused by the coronavirus pandemic. The FMC launched an expansion of that fact-finding mission on Nov. 20, reacting to a growing chorus of complaints and protests about operations at the three ports.

Expansion of the fact-finding mission came a few days after a coalition led by the Harbor Trucking Association, the trade group representing the drayage industry in Southern California, called on the FMC to investigate the Long Beach and LA ports, with particular emphasis on demurrage and detention charges imposed by the three major ocean carrier alliances.

Those charges, often absorbed directly by or passed down to port truckers and U.S. exporters, are being caused by heavy traffic into the ports and significant imbalances between import and export containers.

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John Gallagher

Based in Washington, D.C., John specializes in regulation and legislation affecting all sectors of freight transportation. He has covered rail, trucking and maritime issues since 1993 for a variety of publications based in the U.S. and the U.K. John began business reporting in 1993 at Broadcasting & Cable Magazine. He graduated from Florida State University majoring in English and business.