Maersk’s New D&D Calculations Seen as Benefiting ‘Liner Pockets’

A change in the way Maersk calculates detention and demurrage (D&D) rules will not be effective in helping container flows and will only be beneficial to the pockets of container lines, according to a Los Angeles-based trucking source.

Yesterday, Maersk announced a policy update that will see shippers charged D&D fees over all calendar days after their allocated ‘freetime’, rather than only working days.

The new policy, effective 8 August, means shippers can be charged fees even on days when the pickup or return location is closed and they are physically unable to move their containers.

Freetime will still be allocated only on working days.

“We encourage you to be mindful of your freetime period and facility operating schedules to avoid charges on non-operating days,” the Danish carrier told its customers.

Freetime is the period in which a shipper will not be charged D&D and is calculated on a working day basis according to the pickup or return location’s operating schedule

Ian Weiland, COO at LA-based trucking company Junction Collaborative Transports, said: “This is no change to what all are used to. This has been common practice for as long as I can remember. The kicker to any/all detention conversations is what is the actual freetime?

“If freetime is known, ‘x’ days per carrier, all can operate as such. It’s the constant change and moving targets that create the problems.

“If the change is forever moving, it won’t change behaviour,” he added.

Founder of D&D and maritime dispute company FourOneOne, Sara Dandan, explained: “It’s a natural consequence of the District Court remanding the Evergreen matter and sending it back to the FMC. I’m surprised it took so long for Maersk to publish this and that more carriers haven’t done the same yet.”

CEO of Vespucci Maritime, Lars Jensen, said: “This hits into the – at times – very contentious debate in the US concerning D&D charges and regulations.

“Whilst it is easy to see the argument in terms of ‘why should you pay for days where you physically cannot return the equipment’, there is also the opposite argument that if you do not count those days, there would be very little incentive to rush to return equipment prior to, for example, a weekend or a holiday… and such days could be effectively used by shippers to extend freetime,” he said.

But Mr Weiland added: “I think this will be dressed up and described as help to alleviate container movement, but I don’t think any of this will help shortages….only carriers’ pockets.”

And Ms Dandan continued: “I stand firm in my belief that you should absolutely not be charged D&D for days you can not pick up or drop off your container, that’s ludicrous. But the carriers will keep trying until either they win or they can’t.”

Source: Article