Demurrage

Demurrage is the charge an ocean carrier or marine terminal operator assesses, per container and per day, when a loaded container stays inside the port or terminal after its free time has run out. On an import the clock starts at discharge and the charge runs until the container leaves the terminal on a truck or train; on an export it runs from gate-in until the container is loaded on the vessel. Once the container is outside the terminal, the charge for keeping it is detention instead.

Demurrage vs detention vs per diem

US regulations do not draw a hard line between the terms: the FMC's rules define demurrage and detention together as any charges, including "per diem" charges, assessed by ocean common carriers, marine terminal operators or NVOCCs related to the use of marine terminal space or shipping containers, not including freight (46 CFR 541.3). In the bulk and charter trades, "vessel demurrage" means something else: what the charterer pays the shipowner for keeping the ship beyond the agreed laytime.

Free time and the last free day

Free time is the number of days a container can stay before charges start. It comes from the carrier's tariff, the terminal's schedule or your service contract, and it differs by carrier, port, terminal and equipment type; some contracts give one combined allowance for demurrage and detention. The final day is the last free day (LFD), and demurrage starts the day after. Whether weekends and public holidays count is a tariff rule too, so read the rule, not just the number of days.

How demurrage charges accrue

• Per container, per day: five containers on one bill of lading that each sit three days past the LFD are charged fifteen container-days
• Tiered rates: the daily rate is set in tiers. A first tier applies for the first block of days after free time, a higher rate for the next block, and the top rate for every day after that, so a container that sits two weeks past free time can cost more than twice one that sits one week
• By equipment: rates usually differ for 20-foot and 40-foot containers, and reefer, open-top, flat-rack and hazardous cargo often have their own, shorter free time or higher tiers
• Terminal fees on top: a terminal may charge its own storage under its own schedule, and some terminals will not give a pickup appointment until outstanding demurrage is paid

Two examples

US import, customs exam. A container from India is discharged at Newark, and CBP selects it for a customs examination. The exam, and the move to and from the exam station, uses up the free time, and the container is still in the terminal when the LFD passes. Whether a customs hold or exam stops the demurrage clock depends on the carrier's or terminal's tariff, so check the rule before assuming it does. The FMC's interpretive rule says the Commission may weigh whether demurrage served its purpose, and any extenuating circumstances, when charges arise from government inspections (46 CFR 545.5(c)(2)(iv)).

Indian export, documents late. An exporter in Tiruppur stuffs a container and gates it in at the port, but the shipping bill is not cleared in time and the container misses the vessel cut-off. It waits in the terminal for the next sailing, running through the export free time and into demurrage, while detention may run on the same box under the carrier's local tariff. Charges at the Indian port follow the carrier's and terminal's tariffs there; the FMC's charge complaint procedure does not cover charges on export cargo loaded at a non-US port.

How to avoid demurrage

• File the ISF on time: most ISF data elements are due no later than 24 hours before the cargo is loaded at the foreign port (19 CFR 149.2(b)), so the data has to come from the shipper while the cargo is still at origin
• Clear customs before arrival: have the customs broker file the entry ahead of arrival, with the commercial invoice, packing list and any partner agency data ready, so release does not eat the free time. See customs clearance
• Release the freight early: settle the freight and get the delivery order to the trucker before discharge
• Book the pickup against the ETA: at busy terminals drayage appointments can be days out, so book when the container is available, not when the LFD is close
• Check chassis availability: a container cannot leave the terminal without a chassis, so confirm the trucker has one or the local pool has them before the LFD
• Pre-pull when the dock is not ready: a pre-pull moves the container to the trucker's yard before the LFD, trading demurrage for yard storage and detention
• Negotiate free time: on lanes where you know clearance or delivery takes longer, ask for more free days in the contract, and ask for the tariff rule at booking so an invoice can be checked against it

The US rules: OSRA 2022 and the FMC

• Ocean Shipping Reform Act of 2022 (Public Law 117-146, enacted June 16, 2022): a common carrier may not invoice demurrage or detention unless the invoice shows the charges comply with the FMC's rules, and failing to include the required information eliminates the obligation to pay (46 U.S.C. 41104). It also created "charge complaints": anyone assessed a carrier charge can ask the FMC to investigate it, and on demurrage or detention the carrier bears the burden of showing the charge was reasonable (46 U.S.C. 41310)
• Interpretive rule, 46 CFR 545.5 (2020): the FMC judges whether demurrage and detention practices are reasonable by the extent to which they serve their purpose as financial incentives to promote freight fluidity. It may consider whether free time and demurrage are tied to the cargo actually being available for retrieval, whether and how cargo interests are told the cargo is available, government inspections, and how clear the carrier's policies and dispute process are
• Billing rule, 46 CFR part 541 (published February 26, 2024, effective May 28, 2024): covers demurrage and detention invoices from ocean carriers, marine terminal operators and NVOCCs. The invoice must be issued within 30 calendar days of the last day the charge was incurred; an NVOCC passing a charge on has 30 days from the invoice it received; otherwise the billed party does not have to pay (541.7). It must show the bill of lading and container numbers, the port of discharge for imports, why the billed party is the one liable, the free time in days with its start and end dates, the container availability date (imports) or earliest return date (exports), the dates charged, the tariff or contract rule and rate, the total, a contact and a web page explaining how to request mitigation, refund or waiver, and a certification that the charges follow the FMC's rules and that the billing party's own performance did not cause or contribute to them (541.6). Missing any of it eliminates the obligation to pay (541.5)
• Who may be billed: the rule's section on which parties may be invoiced, 46 CFR 541.4, was set aside by the D.C. Circuit on September 23, 2025, and the FMC removed it from the regulations effective December 29, 2025. The other provisions remain in effect

Who pays demurrage?

The party the carrier's tariff or service contract makes responsible: on imports usually the consignee or importer, on exports the shipper. Each invoice must state why the billed party is the proper party and liable for the charge (46 CFR 541.6(a)(4)). On an NVOCC booking the carrier bills the NVOCC and the NVOCC bills its customer, within 30 days of the date of the carrier's invoice (46 CFR 541.7(b)). Who finally bears the cost between buyer and seller is a matter for the sales contract and the Incoterms rule it uses.

Can demurrage be disputed?

Yes. Under 46 CFR 541.8 the billing party must give you at least 30 calendar days from the invoice date to request mitigation, refund or waiver, and must try to resolve the request within 30 days of receiving it. When an NVOCC's customer disputes a charge, the NVOCC can tell the carrier and gets another 30 days to dispute it (541.7(c)). Keep the evidence: the availability notice, appointment-system screenshots showing no pickup or return slot, the gate and equipment interchange records, and the customs release time.

If the billing party does not resolve it, the FMC accepts charge complaints about a common carrier's charges by email under its interim procedure, and a charge complaint can also be filed as a formal or small claims complaint. The procedure does not cover charges from a marine terminal operator acting on its own account, charges not yet invoiced, or charges at a non-US port. This page explains what the rules say, not how they apply to your invoice; for that, use the FMC's guidance and your own advisers.

Airlift is an FMC-licensed NVOCC (OTI 016162) and not a customs broker. Container tracking follows the container from discharge to gate-out, our drayage service, arranged as a non-asset, FMCSA-licensed broker, books the pickup as soon as the container is available, and licensed brokers in our network file the entry through our customs clearance service, with ISF filing ahead of loading. Transit ranges on the India to USA lane help set the drayage booking date.