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FMC Warns Carriers Against Abuses Due Service Disruptions in Baltimore

Baltimore
FMC warned over abuses during the service disruptions in Baltimore (Port of Baltimore file photo)

Published Apr 5, 2024 5:28 PM by The Maritime Executive

 

The Federal Maritime Commission issued a statement on Friday warning carriers against taking advantage of the current disruptions in services due to the suspension of vessel traffic in the Port of Baltimore. The regulatory agency recognizes that many shippers are being forced to adjust supply chain operations while regular service at the Port of Baltimore is impacted by the collapse of the Francis Scott Key Bridge.

“Regulated entities are reminded that all statutes administered by the Federal Maritime Commission remain in effect. Common carriers and marine terminal operators (MTOs) must continue to comply with all statutory and regulatory requirements governing their operations,” they warned in today’s advisory.

In the hours and days after the incident, terminal operators highlighted that they were still open despite vessel traffic being suspended. On dock operations were continuing while shippers were being advised to suspend or reroute cargo. The terminals advised that they would stop receiving cargo but that they were open and continuing to process shipments at their terminals.

The FMC is specifically highlighting demurrage and detention fees, which continue to be one of the most contentious issues between carriers, terminals, truckers, and shippers. The FMC warns today that D&D fees “must be reasonable.” They are instructed that FMC regulations require demurrage and detention fees meet a reasonableness test of whether the charges serve as legitimate financial incentives to encourage cargo movement. 

“Demurrage and detention invoicing must be lawful,” they warn. They are also providing details on how complaints can be filed.

The major carriers servicing the Port of Baltimore all issued alerts to customers while saying they were working with them to help with the disruptions. MSC, for example, issued its third update yesterday for customers reporting that vessels in the 2M Alliance would mostly be diverting containers to New York or in three cases Norfolk. They have advised shippers, that their cargoes “will be declared terminated at this alternate port and storage, D&Ds and on-carriage costs to the initially intended destination will be for the sole cargo’s account.” 

CMA CGM also declared a Force Majeure at the end of March for all shipments to and from Baltimore. They also said that CMA CGM's bill of lading will terminate for inbound cargo at the diversion port. 

“We understand your need for clarity on your cargo, as well as future changes to our routes regarding Baltimore,” Maersk said in a customer advisory issued on April 3. “We are working diligently to identify solutions and will inform you as soon as possible of changes to current and future cargo to Baltimore.”

Maersk also asked customers who are making their own arrangements for their Baltimore cargo to notify representatives so that we can update their systems and operational plans. At the same time, they asked customers who had import cargoes into both Newark and Norfolk to arrange to pick up your containers as soon as possible to assist with increased flows of containers.