Detention refers to the time a container spends outside ofthe port while Demurrage penalty fees are used to prevent containers from beingstored at the port for a long time.

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• Customs clearance delays due to port congestion
• Incorrect or incomplete documentation
• Lack of storage space at the terminal
• Unexpected events like mechanical breakdowns or inclement weather can cause delays in logistical activities within the terminal

• Delays in inland transportation
• Delays in warehouse operations
• Unexpected events like bad weather, strikes, or natural disasters can delay the return of the container
• Poor planning and communication between parties involved (shipper, consignee, carrier)

According to the Federal Maritime Commission (FMC), from2020 to 2022, nine of the largest ocean freight carriers collected $8.9 billion worth of demurrage and detention fees during the COVID-19 pandemic. OSRA was enacted in 2022 in response. Its objective is to reduce shipping costs and address concerns relating to supply chain challenges.

Key Provisions of OSRA are:

• Billing Parties: Detention and demurrage invoices can only be issued to either the person who contracted for ocean transportation or storage of cargo (Beneficial Cargo Owner (BCO)) or the ultimate recipient of the cargo (consignee). Invoices cannot be sent to multiple parties simultaneously.
• Invoice Content: Invoices must include specific information mandated by OSRA. Failure to include this information eliminates the obligation to pay the charges.
• Timeframes: Vessel Operating Common Carriers (VOCCs) and Marine Terminal Operators (MTOs) must issue invoices within 30 days from the last day charges were incurred. Non-Vessel Operating Common Carriers (NVOCCs) must issue invoices within 30 days of receiving the invoice from the VOCC. Billed parties have at least 30 days to request fee mitigation, refunds, or waivers.
• Dispute Resolution: If a timely filed request is made, the billing party must attempt to resolve the matter within 30 days, unless both parties agree to a longer timeframe.

OSRA requires 13 data elements on every detention and demurrage invoice to protect shippers from being wrongfully billed:

• The date the container is made available
• Port of discharge
• The number of containers
• The earliest return date for exports
• The number of free days
• The beginning date for free time
• The end date for free time
• The carrier’s applicable detention or demurrage rule on which the daily rate is based
• The applicable rate or rates per the applicable rule
• Total amount due
• Email, telephone number, or other appropriate contact information for questions or requests for mitigation of fees
• Statement showing charges are consistent with FMC detention and demurrage rules
• Statement showing common carrier’s performance did not cause or contribute to the underlying invoiced charges

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No. Billing parties are not permitted a grace period to correct incorrect invoices that fail to meet statutory requirements. While there is no obligation on the billed party to advise of an incorrect invoice, a carrier may reissue the charges on a new invoice that meets the statutory requirements.

• OSRA limits the responsibility of paying detention and demurrage charges to the entity that has the direct transportation contract with the ocean carrier or VOCC – most typically a BCO or shipper.
• A consignee for the container can also become a billed party for a per diem invoice under the FMC rule-making, even if it did not originally contract for ocean freight transportation.  
• OSRA stops per diem charges from being sent to parties, such as trucking firms, who did not negotiate contract terms for ocean transportation or storage of cargo with the billing party.  

• Yes. It applies to rail if it’s an intermodal shipment andcontracted by the ocean freight carrier, for example, to move to an inlandlocation.
• OSRA applies to detention and demurrage charges levied byboth ocean carriers and marine terminal operators.
• Since port storage charges often involve container detention, they fall under the regulations.

• The FMC established an interim process for submitting charge complaints and has hired additional staff to investigate complaints.
• As of May 10, 2024, the FMC is in the process of creating an interim “one-stop” website for submission of comments, complaints, concerns, and requests for investigations to serve as a bridge while a longer-term product is developed.

The OSRA regulations do not specify who is responsible for paying the charges. However, they have clarified who could be billed. If the BCO is billed, they can choose to involve a broker in the payment process, but the ultimate responsibility for paying the charges lies with the BCO.

• Yes. Under OSRA, the invoice should be sent to the party who contracted for the transportation or storage, usually the Beneficial CargoOwner (BCO) or the consignee.
• If you are the BCO and the ocean freight carrier is sending invoices to the trucking firm, technically this means the invoice isn’t valid and shouldn’t be paid.
• Only invoices sent to the right party are valid.

The Earliest Return Date (ERD) specified in the invoice indicates the date by which the exported container must be returned to the designated location, typically the port or container yard.

The terminal itself is not involved in the inland transportation or responsible for meeting the ERD. Their role is to receive, store, and verify the container's condition before and after the ocean voyage.

Once the container is loaded and leaves the terminal, the responsibility for returning it by the ERD falls on the trucker or whoever contracted the inland transportation.

The typical process to return a container is:

• The shipper or exporter packs the container and arranges inland transportation to the port terminal.
• The terminal receives the container and verifies its condition.
• The SSL or NVOCC issues a bill of lading (BOL) acknowledging receipt of the container and initiating the ocean transportation. The ERD may be noted on the BOL or a separate document.

Yes. OSRA mandates that invoices include specific information to demonstrate compliance with the regulations. You are not obligated to pay the charges if any required information is missing. Failure to include the required information on a demurrage or detention invoice eliminates the billed party's obligation to pay the applicable charge.

You may be billed for both demurrage by the carrier for exceeding free time at either or both the port and the terminal.

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The UIIA may still be used in disputes, but OSRA establishes a minimum timeframe for billing parties to address disputes. If you are unable to resolve the issue with the billing party within the timeframe, you can file a charge complaint with the FMC.

Not necessarily. OSRA prohibits VOCCs from withholding cargo solely due to unpaid demurrage charges if the invoice is not compliant. They also can require “payment upon receipt” for demurrage. However, unpaid demurrage charges may accrue further.

The OSRA regulations, effective May 28, 2024, prohibit VOCCs from taking any action to prevent cargo pick-up or container return due to unpaid detention or demurrage charges if the invoice is not compliant with the new requirements.