Home News FIATA calls for Government Support to FMC on Demurrage, Detention rule

FIATA calls for Government Support to FMC on Demurrage, Detention rule

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International Federation of Freight Forwarders Associations(FIATA)  has  called for government support of the key considerations laid out by the US Federal Maritime Commission (FMC) in its Final Rule on Demurrage and Detention to assess the reasonableness of these practices.
 The FMC’s decision came after six years of investigation with all actors in the supply chain, which concluded the likeliness of a long history of unjust and unfair demurrage and detention practices.
Whilst there are country and port related variances, the FMC findings apply globally as demurrage and detention is a common and widespread topic of contention.
” If the FMC has identified demurrage and detention practices that are likely to be considered as unjust for the USA, these practices are also unjust and unreasonable for the rest of the world.”
The Organisation urged Governments of various nations to have greater scrutiny over demurrage and detention practices to ensure that they are considerate and reasonable for the good of their own economies.
”It is crucial to ensure fluidity and good function of the supply chain, in unprecedented times as illustrated by COVID-19 and beyond. Policymakers are encouraged to consider the FMC’s non-exclusive list of factors for consideration when assessing the reasonableness of demurrage and detention,” FIATA added.
It pointed out that the interpretive rule will also mitigate confusion, reduce and streamline disputes, and enhance competition and innovation in business operations and policies.
FIATA enjoined decisionmakers to ensure a level playing field for all actors in the supply chain of the reasonableness of demurrage and detention charges with the consideration of the extent to which demurrage and detention practices are serving their intended purposes as financial incentives to promote freight fluidity.
”All international maritime supply chain stakeholders should also benefit from transparent, consistent and reasonable demurrage and detention practices that improve fluidity in global ports and terminals for the benefit of fair, reasonable and ethical interactions between stakeholders in the maritime supply chain,” it stated.
The FMC rule is therefore intended to stop unreasonable and unjust practices that shippers and freight forwarders alike have for years been exposed to.
 FIATA is a nongovernmental, membership-based organization representing some 6,000 freight forwarding associations and logistics firms in about 150 countries.

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