FMC Receiving Charge Complaints, Preparing Proposed D&D Billing Requirements, Official Says
The Federal Maritime Commission has received nearly 100 charge complaints and numerous questions related to the Ocean Shipping Reform Act since its enactment earlier this year, FMC official Lucille Marvin said during a Sept. 21 FMC meeting. She also said the agency is making progress on a range of OSRA provisions and other agency priorities, including one that will result in a set of best practices for chassis pools and another that will formally propose new demurrage and detention billing requirements.
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The FMC has received 95 charge complaints, Marvin said, a steep increase from the seven complaints it had received by the end of July (see 2207290013). “And more come in each week,” she said. About half of the complaints are under investigation, Marvin said, while the other half were rejected because they either were “incomplete,” were not eligible for the charge complaint process or involved an issue that predated the enactment of OSRA.
FMC Chair Daniel Maffei said he has encountered confusion from industry about what types of submissions are eligible for the new complaint submission process, which was released in July as a streamlined way for parties to submit disputes of carrier charges that may not be complying with OSRA (see 2207150031 and 2207140045). Maffei said the submission process can only be used by complaints that involve charges made on or after OSRA’s enactment date.
“We have gotten a lot of questions,” Maffei said. “We think it’s going to be a very good and speedy process, so I don't blame people for wanting to access it.”
The FMC has also received “numerous requests for informal guidance” about OSRA, Marvin said. Multiple shippers, for example, have asked whether they must pay a detention or demurrage invoice from a carrier if the invoice is inaccurate.
The commission believes that if a carrier sends an inaccurate invoice, that “it does not immediately eliminate the obligation of the charged party to pay in perpetuity,” Marvin said. “Instead, a carrier may reissue an accurate invoice.” She also said the parties can use the FMC’s dispute resolution process to “resolve the matter,” or the shipper can file a complaint with the commission. Marvin also said the FMC hopes to eventually publish a new webpage that will allow industry to submit “comments, complaints, concerns, reports of non-compliance, requests for investigation and requests for alternative dispute resolution.”
The commission is also working on several OSRA-related rules, including a rulemaking to formally propose new demurrage and detention billing requirements, said Katia Kroutil, the commission’s acting general counsel. The FMC in February published an advance notice of proposed rulemaking on the potential requirements (see 2202070026), which requested feedback on whether it should require carriers and terminal operators to include certain minimum information with their billings, whether they should be issued to shippers within a certain time frame and more. The commission received mixed feedback, with shippers saying the rules are sorely needed and at least one carrier saying the industry shouldn’t face additional regulations (see 2203250028). Kroutil didn’t provide a time frame for the proposed rule.
Another OSRA provision being prioritized by the FMC would result in a set of best practices for on-terminal or near-terminal chassis pools, Marvin said. The FMC is working with the Transportation Research Board of the National Academies of Sciences, Engineering and Medicine to “carry out a study and develop” the best practices, Marvin said, “with the goal of optimizing supply chain efficiency and effectiveness.”
Commissioner Rebecca Dye said the FMC is “well ahead of schedule” on the effort. Marvin said the FMC hopes to publish the best practices by January 2024.
The commission recently opened the comment period for another OSRA-related rule that seeks feedback on the set of factors it should consider when determining whether an ocean carrier is violating shipping regulations by refusing vessel space to shippers (see 2209130040). Maffei urged industry to submit comments by the Oct. 21 deadline, adding that the FMC is facing time pressure and an extension may not be possible.
“This commission often gives extensions and more time for feedback because we want to hear from the public,” Maffei said. But “I urge, urge, urge people to get their comments in on time. We genuinely do want to hear from you, but we are under the gun on this one. So Oct. 21 is the real deadline for getting comments on this particular part.”
Commissioner Max Vekich said he hopes he hears from exporters in the comments. Exporters for months have complained about carriers continuing to send empty containers back overseas rather than filling them with exports because the carriers can charge higher rates for imports (see 2104280031 and 2203210026). “I am looking forward to hearing from the industry what steps we can take to promote U.S. exports” with the rule, Vekich said, adding that exports are “the backbone of our economy.”