February 15, 2022 | By Bestway

FMC Detention Fees Fire Up

FMC Fees

The FMC has received a response from Wan Hai, the Taiwanese carrier denying the illegality of the detention and demurrage charges applied to twenty-one containers. The issue arises from an FMC investigation that is looking into the way charges are applied and if there are mitigating circumstances that precluded a prompt pick-up. Demurrage and detention charges should be applied to expedite the process of clearing cargo from the port and not penalizing shippers for carrier congestion – which is what Wan Hai, and others, are allegedly doing. 

FMC investigations are looking into whether charges were applied due to an actual delay on the part of the recovery of the container and not when appointments were unable to be made or equipment unavailable. Because the fees have ramped up in the last two years due to the record imports, more and more claims are coming in that accuse carriers of applying charges for demurrage and detention when carriers themselves didn’t have any appointments available. According to Freightwaves, one California drayage company amassed over a quarter of a million dollars in fines. 

As the claims are investigated, the FMC is working on streamlining the charges and the notations on the invoices to show more specifically and more uniformly why, how, and when charges are applied to clarify the issue to shippers and detail the time period for when the charges were applied. 

In the case of Wan Hai, the issue stems from their refusal to waive charges when proof was presented that it was Wan Hai who was the cause of the delays in three key ways: 

  • Wan Hai either failed to provide an equipment return location
  • Where Wan Hai identified an equipment return location that was not accepting the container chassis
  • Appointments were unavailable for equipment return

Errors in bookkeeping are nothing new, and often they’re not nefarious in nature – considering the swell of cargo coming into the United States, it stands to reason that there will be misapplied fees and incorrect assessments. Your trusted freight forwarder should be prepared to naturally do a cursory audit of fees and explain their accuracy while assisting your plan to prevent future issues. More than that, we all need to be aware that on occasion those fees are coming without merit or fault and that’s when action is required. 

Bestway will be watching this issue to ensure that any fees applied to our clients are fair and legal while reporting those that aren’t. If you have any questions, or received fees that should have been waived, we encourage you to collect your records and reach out to your Bestway representative to discuss ways to dispute those fees.