Although the incentive principle and its applications were the focus of the rule, the Commission's guidance also included other factors that the Commission may consider as contributing to the reasonableness inquiry.[330] electronic version on GPOs govinfo.gov. Conversely, other commenters request that the Commission expressly overrule the once-in-demurrage, always-in-demurrage principle.[227]. The Commission received a number of comments about billing and invoices. 75. Comm'n, 706 F.2d 1231, 1238 (1st Cir. 358. 305 does not grant the Commission power to prescribe regulations to implement section 41102(c) is unpersuasive. 1989); id. Ocean carriers and marine terminal operators argue that it is permissible to treat government inspections differently under Commission precedent. Ch. 5 08-03, 2016 FMC LEXIS 61 *9-*11 (FMC Oct. 26, 2016). 2013) (noting that guidance in form of a seven-factor test was not subject to the APA's notice-and-comment provision). 84 FR at 48852-53; id. Accordingly, the Commission is retaining the language about dispute resolution policies in the final rule, with, as explained above, the clarification that the Commission may consider the content and clarity of demurrage and detention policies under section 41102(c). Under this approach, the detention clock should stop once a container has been or could be delivered back to the port, VOCC or CY [container yard], but for the recipient's inability or unwillingness to receive the asset.[279] Absent extenuating circumstances, practices and regulations that provide for imposition of detention when it does not serve its incentivizing purposes, such as when empty containers cannot be returned, are likely to be found unreasonable. of Freight Forwarders Ass'ns at 5; VLM Foods USA Ltd. at 1. 84 FR at 48853; Final Report at 20. 227. Exec. 63. 144. Corp. v. ICC, 872 F.2d 1048, 1060 (D.C. Cir. Each section 41102(c) case would continue to be decided on its particular facts, and the rule would not foreclose parties from raising, or the Commission from considering, factors beyond those listed in the rule. . E.g., Am. Browse USLegal Forms largest database of85k state and industry-specific legal forms. That one purpose of the Shipping Act is to minimize government intervention does not mean that the Commission may abandon its duty to prevent unreasonable practices under section 41102(c). Consequently, that the guidance in the rule, when applied in a case, might put some limits on the ability of ocean carriers or marine terminal operators to impose, or negotiate, demurrage and detention practices vis--vis shippers, intermediaries, and truckers, is not itself a reason not to issue guidance. This rule does not contain any collections of information as defined by 44 U.S.C. Ocean carriers remain subject, however, to section 41102(c) and its requirement that demurrage practices be tailored to meet their purposesacting as financial incentives for cargo and equipment fluidity. The Commission is therefore retaining this language about the existence of policies in the final rule. 285. Interim Report at 17; Final Report at 32. The caselaw involves demurrage, but similar concepts would apply in detention context. at 96; id. But not all did, and a shipper's right under the Shipping Act to be free from unreasonable practices under section 41102(c) does not turn on the identity of the regulated entity at issue. At most, it stands for the proposition that once free time ends, a shipper may be responsible for any compensatory aspect of demurrage. 165. Others assert that free time and demurrage and detention clocks should stop when containers become non-accessible due to situations beyond the control of shipper or trucker. Opinion analysis: The Court slays the D.C. Circuits Final Report at 19 (noting that some terminal operators as well as cargo interests believed that vessel arrival is a poor proxy for notice that a container is available); see also Transp. 325. [274] 40102(18). The Commission sought comment on three proposals, and any other suggestions for handling demurrage and detention in the context of government inspections, consistent with the incentive principle.[301] Ocean carriers argued that demurrage and detention function to compensate them for costs associated with their equipment. Interpretive Rule | Center for Effective Government Justices Thomas and Scalia called into question the validity of the Seminole Rock doctrine which required deference to agencies administrative interpretations of regulations and signaled their willingness to reconsider the doctrine in an appropriate case. But the Commission will not in this general interpretive rule make a finding that failure to start free time upon availability is necessarily unreasonable. 96. Mar. First, NAWE argues that [b]y specifying the behavior or manner of compliance that regulated entities should adopt rather than performance objectives, the NPRM violates Executive Order 12866.[98] If the issuance of guidance results in more disputes because shippers are better able to challenge unreasonable practices, that is a feature, not a bug, of the rule. NAWE at 17; PMSA at 12 ([T]he Commission has no authority to require non-tariff publication of rates and charges, however desirable it might be from a customer service standpoint.). [20] 305, 40307, 40501-40503, 41101-41106, and 40901-40904; 46 CFR 515.23. Shipping Act, 1916, Public Law 64-260, 17, 39 Stat. There was significant discussion during the investigation about who should be providing notice related to cargo availability. The Commission went on to note that [t]his factor favors demurrage and detention practices and regulations that make policies available in one, easily accessible website, whereas burying demurrage and detention policies in scattered sections in tariffs would be disfavored.[338]. 2023 Legislative Update | Department of Labor & Employment 41102(c).); Cal. E.g., Int'l Fed. Regulations are substantive agency rules with the force and effect of law developed in accordance with the Administrative Procedure Act and an agency's enabling legislation. Demurrage and detention are valuable charges when applied in ways that incentivize cargo interests to move cargo promptly from ports and marine terminals; All international supply chain actors could benefit from transparent, consistent, and reasonable demurrage and detention practices, which would improve throughput velocity at U.S. ports, allow for more efficient use of business assets, and result in administrative savings; and. The [filed rate] doctrine is meant to preserve the integrity of filed tariff laws, not to provide carriers with an irrebuttable excuse for alleged violations of the Act.[113]. Because, the commenter asserted, markets are less efficient when entities have the power to levy unreasonable charges on their competitors, the Commission's guidance should make clear that containers in merchant haulage and carriers haulage be treated alike.[422], Although the rule does not address these specific situations, the Commission has concerns about them, especially charging shippers demurrage on carrier haulage moves, under section 41102(c) and will closely scrutinize them in an appropriate case. [28] corresponding official PDF file on govinfo.gov. at 2. INTERPRETIVE In this sense, ocean carriers and marine terminal operators are no different from participants in other regulated industries. [116], A few commenters, however, assert that Commission guidance is not necessary because the current freight delivery system is working,[117] The OFR/GPO partnership is committed to presenting accurate and reliable Digital marketers that are involved in the identification or selection of prospective customers or the selection or placement of content to affect consumer behavior are typically service providers for purposes of the law. OCEMA at 4; Ocean Network Express at 3-4; WSC at 17. Transp. [89] In Free Time and Demurrage Charges at New York, the Commission held that ocean carriers are not required to extend free time to account for government inspections of cargo. 71. 52. Subscribe to our email newsletter. It is not an official legal edition of the Federal 12988 titled, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. As in initial matter, the order does not apply to the Commission. Coffee Corp.; Green Coffee Ass'n; Am. Int'l Ass'n of Movers at 2 (Delays are typically experienced because of a backlog or lack of CBP manpower, required to be present during the intensive exams.). Only official editions of the BILLING CODE: 4810-AM-P BUREAU OF CONSUMER The first paragraph of the proposed interpretive rule in the NPRM describes its purpose: To provide guidance about how the Commission will interpret 46 U.S.C. Small Business Lending Under the Equal Credit Opportunity Act This relationshiphow marine terminal operators are compensated by ocean carriers for use of their terminal facilitiesis not the primary concern of the guidance in the rule, even if marine terminal operators are compensated by carriers via charges called wharf demurrage or terminal demurrage.[196] League at 8 (The League agrees wholeheartedly that the reasonableness of demurrage practices and charges, including free time rules, should be related to actual physical availability of the cargo.); Am. ); Commodity Supplies, Inc. at 2 (same, but for detention). Justice Alito, referencing the reasons offered by Justices Thomas and Scalia, echoed their desire for the case that will allow for reconsideration of the doctrine. 2015) (The Commission reasonably concluded that it makes little sense to bring into its regulatory ambit all facilities operated by an entity merely because a single one of them is connected to international marine transportation.); Crocus Investments, LLC v. Marine Transp. In other words, why are government inspections different from any other circumstance where a shipper cannot retrieve its cargo? SECURITIES AND EXCHANGE COMMISSION 17 CFR Part (The more these factors align with the goal of moving cargo off terminal property, the less likely demurrage practices would be found unreasonable.). Mar. 388. For example, the Executive Office for Immigration Review maintains a list of "Operating Policy & Procedure Memoranda for OCIJ" and the "Immigration Court Practice Manual. 140. [233] An agency should instruct all employees engaged in an activity to which an interpretive rule pertains that, although the interpretive rule may contain mandatory 365. 1348, 1356 n.14 (ALJ 2003)). 114-254). Moreover, this guidance does not mean that the Commission would find a section 41102(c) violation simply because an ocean carrier or marine terminal operator changed its terminology. Suffice it to say, availability at a minimum includes things such as the physical availability of a container: Whether it is discharged from the vessel, assigned a location, and in an open area (where applicable). NAWE at 13; OCEMA at 4. Accordingly, because the participants in Fact Finding Investigation No. Some states allow agencies to make rules for the conduct of their own procedures even without explicit statutory authorization. . John S. Connor Global Logistics at 1; AgTC at 1; ContainerPort Group at 1; Mohawk Global Logistics at 6-7. Although section 41102(c) and this interpretive rulemaking might not be the right vehicle for addressing these concerns, the Commission may consider in an appropriate case whether an ocean carrier tariff is clear and definite as required by 46 CFR 520.7(a)(1). The Commission is sympathetic to shipper, intermediary, and trucker arguments that bright line rules will be more beneficial to them and would be clearer than the Commission's factor-based approach. Congress Spotlights Serious Forced Labor Concerns With Aluminum Bahrain (The rail carrier and the yard itself made sure that every container paid extra for the chassis and for detention); APL Logistics (APL Logistics seeks clarification whether the proposed interpretive rule applies to railroad terminals when an international shipment passes through a marine terminal operator and is then transported to its final destination via rail on a through bill of lading); Global Fairways LLC (complaining about rail practices and ocean carriers not providing sufficient information); IMC Companies; Wheaton Grain. [52], None of the factors support treating the Commission's non-exclusive list of considerations as a legislative rule. increased container dwell time;[150] Comcast noted that five major cable and telecom industry trade groups petitioned the FCC in January to change the rules. The Commission's proposals were: (a) In the absence of extenuating circumstances, demurrage and detention practices and regulations that provide for the escalation of demurrage or detention while cargo is undergoing government inspection are likely to be found unreasonable; (b) In the absence of extenuating circumstances, demurrage and detention practices and regulations that do not provide for mitigation of demurrage or detention while cargo is undergoing government inspections, such as by waiver or extension of free time, are likely to be found unreasonable; or, (c) In the absence of extenuating circumstances, demurrage and detention practices and regulations that lack a cap on the amount of demurrage or detention that may be imposed while cargo is undergoing government inspection are likely to be found unreasonable.[302]. 86. rules The Commission explained that such practices, absent extenuating circumstances, weigh heavily in favor of a finding of unreasonableness, because if an ocean carrier directs a trucker to return a container to a particular terminal, and that terminal refuses to accept the container, no amount of detention can incentivize its return. The Bulletin provides definitions forthese terms. [379] Interpretive rule. Merriam-Webster.com Legal Dictionary, Merriam-Webster, https://www.merriam-webster.com/legal/interpretive%20rule. The Commission has also made technical formatting changes to the paragraph levels in the final regulatory text. Accordingly, the Fact Finding Officer explained, when incentives such as demurrage and detention no longer function because shippers are prevented from picking up cargo or returning containers within time allotted, absent extenuating circumstances, charges should be suspended.[25]