Interestingly, the bill’s language also includes a powerful incentive for carriers to get it right, saying: “Failure to include the information required under subsection (d) on an invoice with any demurrage or detention charge shall eliminate any obligation of the charged party to pay the applicable charge.’’. As a practical matter, this means that cargo owners could see delays in getting their actual D and D invoices as carriers make sure that bills conform precisely with requisite data fields.
Some carriers are opting to delay such billing so they can comply with changes to the laws. This may delay the ability to invoice our clients on some of these charges, as carriers struggle with creating new data fields on their invoices.
The Thompson Coburn legal team puts a very broad perspective on OSRA 2022, saying: “OSRA 22 is clearly the product of recent shipper frustrations with port congestion, container and chassis equipment shortages, record-high ocean freight rates, and aggressive assertion of demurrage and detention charges by ocean carriers. Many of these issues reflect global economic forces beyond the control of anyone trading country.” Referring to the broad bi-partisan support for the new legislation, they add: “However, it is noteworthy that Congress, with little internal controversy, turned its gaze on the US regulatory structure governing ocean shipping for the first time in nearly a quarter century.”
The law firm Venable LLP stresses that: “The importance of properly assessing charges is especially underscored in light of the FMC’s recent enforcement action and settlement with Hapag-Lloyd for alleged violations related to its detention and demurrage practices.” In early June, the FMC had agreed with Hapag Lloyd on $2 million fine, following an April decision in a case involving difficulty in returns of containers at the ports of Los Angeles and Long Beach.