PKDC, a Colorado-based furniture distributor, accused ocean carrier CMA CGM of refusing to meet its commitments to the distributor, coercing "extracontractual" payments from PKDC, and charging detention and demurrage for situations outside the distributor's control. The furniture distributor, in a complaint to the Federal Maritime Commission dated May 10, said it paid over $1 million in unreasonable detention and demurrage and that CMA CGM cost it over $12 million by refusing to meet its quantity commitments under the service contract.
Two provisions in a February final rule (see 2402230049) from the Federal Maritime Commission -- which set requirements for the information that will soon need to be reported in demurrage and detention invoices -- will take effect along with the rest of the final rule May 28, the commission said in a notice released this week. The FMC had been awaiting approval from the Office of Management and Budget for an information collection request "associated" with those two provisions, and the commission said it received that approval April 16. Those two provisions are: 46 CFR 541.6 and 541.99.
Flexport violated U.S. shipping laws when the logistics company failed to perform its "inland transportation obligations" and charged unfair detention and demurrage fees, Peloton said in a complaint filed with the Federal Maritime Commission May 3. Peloton said it paid "thousands" of improper detention and demurrage charges totaling "millions of dollars."
The Federal Maritime Commission has jurisdiction on cargo moved inland only under a through bill of lading, and contracts between a vessel-operating common carrier and a motor carrier not based on the through bill of lading would "likely be" outside the scope of commission's new detention and demurrage rule released in February (see 2402230049), the commission said. The FMC, in a correction to that rule set to be published in the May 9 Federal Register, stressed that a vessel-operating common carrier must comply with the new detention and demurrage requirements when issuing an invoice if FMC's jurisdiction applies.
The Mediterranean Shipping Company denied allegations by the Federal Maritime Commission that it knowingly violated U.S. shipping laws, calling a proposed $63.2 million FMC penalty "excessive and unlawful.”
The National Customs Brokers & Forwarders Association of America asked the Federal Maritime Commission questions on the demurrage and detention final rule (see 2402230049). The NCBFAA, in comments dated April 22, said the questions were submitted on behalf of its members and other "industry stakeholders" and raised several questions that were not addressed in the final rule.
The National Customs Brokers & Forwarders Association of America's president told the U.S. trade representative that customs brokers and others in the trade community aren't "pro forced-labor, pro-pollution, pro-unsustainable environmental practices," but that too often, "‘race to the top’ objectives do not take into consideration the ability to actually implement the policies, and the costs associated with the goals."
'Head Scratching' Likely After D&D Rule in Effect; Changed Broker Terms Possible, NCBFAA Lawyer Says
FORT LAUDERDALE -- The effective date for the Federal Maritime Commission's new rule on detention and demurrage may not provide a long enough "runway" for industry to prepare, given that it's a "systemic alteration" of how the industry operates, said Ashley Craig of Venable. He said he suspects there will be a lot of "head scratching" after the rule becomes effective on May 28 (see 2402230049).
Two subsidiaries of a U.S.-based cleaning product supplier voluntarily dismissed their charge complaint against major ocean carrier Mediterranean Shipping Co., telling the Federal Maritime Commission April 10 that the companies have agreed to reach a “resolution of this matter outside of” FMC proceedings. Impact Products and Safety Zone, subsidiaries of Supply Source, accused MSC in February of issuing unfair detention and demurrage and committing other violations of U.S. shipping laws, leading to over $200,000 in financial damages (see 2402140014).
The Federal Maritime Commission's enforcement bureau is asking the agency's administrative law judge to fine major ocean carrier Mediterranean Shipping Company $63.2 million for violating U.S. shipping regulations. MSC used “overbroad” merchant clauses in its bills of lading, billed incorrect rates for certain containers and failed to publish certain container tariff rates, causing "obscurity" and "uncertainty" for shippers, the commission's Bureau of Enforcement, Investigations and Compliance said in an April 3 report.