Shipper-Focused Trade Associations Request U.S. Federal Maritime Commission (FMC) Clarify Container Dwell Fee

November 16, 2021

Collection of Proposed Fees at Ports of Long Beach and Los Angeles Have Delayed Until November 22nd

 

Yesterday, IAM joined 84 leading shipper-focused trade associations, requesting the FMC issue clarification on the forthcoming Container Excess Dwell Fee (CEDF), scheduled to be issued to ocean carriers by the Ports of Los Angeles and Long Beach beginning November 22nd.  IAM shares the concern of other shipper-focused companies and associations, as the carriers have stated their intent to pass these charges through to the beneficial cargo owners (BCOs) and the broader shipper community.

 

The letter points out that any CEDF would be similar to current demurrage fees being paid, and that a pass through of the CEDF  should be considered a double dip by ocean carriers. The CEDF should be subject to the Commission's Final Interpretive Rule (FIR) on unjust and unreasonable demurrage and detention practices. 

 

Since the fee does not serve the purpose of "incentivizing the movement of cargo" (considering the congestion, lack of chassis, other equipment, appointments, dock space and drivers), then its pass-thru would unfairly penalize the shipper and function as an improper revenue stream. The letter requests the Commission provide immediate clarity on the CEDF application (as part of the FIR), and prevent its ultimate pass-through to the shipping community.

 

In related news, yesterday officials with the Ports of Los Angeles and Long Beach announced a one-week delay in the implementation of the CEDF. They will reassess the fee again on November 22. In delaying fee collection, the ports acknowledged the significant progress that had been made in clearing the backlog of containers off the docks, and an overall reduction of aging cargo by 26%.

For more information or questions on any of the initiatives or issues highlighted, please contact Bryan Vickers (703-403-2882, bvickers@pacellp.com) with IAM's Government and Regulatory Affairs Team.