Container cargo companies quickly suspended so-called “port congestion” surcharges
they had tied to a work slow down by dock workers at West Coast ports after a
raft of complaints by shippers prompted scrutiny by the Federal Maritime
Commission.
The FMC posted a notice on its website Nov. 17 reminding shippers that ocean carriers are not allowed to impose so-called “port congestion” surcharges related to the slow down at West Coast ports if the delays occurred after the shipper tendered their cargo to the carriers.
The FMC issues the reminder Nov. 17 after receiving numerous inquiries regarding the congestion surcharges for “labor unrest” being implemented by ocean carriers as announced in tariff rules required to be published under the Shipping Act of 1984 and the Commissions regulations at 46 CFR Part 520.
Unless done pursuant to a waiver or exemption, any tariff rule – including surcharges – of a common carrier that results in an increased cost to a shipper may not be effective earlier than 30 days after publication. For further details, shippers are encouraged to review 46 U.S.C. § 40501(e) and 46 CFR § 520.8.
Many carriers previously published in their tariffs advance or conditional notice of an intention to implement surcharges in the event certain conditions are experienced. All such carrier tariff rules, however, must be clear and definite as to the implementation and termination of the surcharge based upon specific criteria related to “labor unrest.”
The Shipping Act and the Commissions regulations require that the rules applicable to any given shipment shall be those in effect on the date the cargo is received by the common carrier or its agent. 46 CFR § 520.7. Thus, if any labor disruption were to occur at a port after cargo has been tendered by a shipper, a carrier may only lawfully charge the rates in effect on the day the cargo is tendered.
The Commission continues to review congestion surcharge rules published in carrier tariffs and is gathering information from carriers regarding implementation of these surcharges.
If you have questions or concerns about a tariff publication, please contact the Bureau of Trade Analysis at tradeanalysis@fmc.gov. For questions about the Shipping Act or the Federal Maritime Commissions regulations, please contact the Office of the General Counsel at generalcounsel@fmc.gov.
