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Knowing how to dispute demurrage charges starts with a fast audit: check the invoice against your contract and the Federal Maritime Commission’s billing rule, submit a written mitigation request to the carrier within 30 days, and escalate unresolved claims through an FMC charge complaint, arbitration, or litigation. Federal law now requires carriers to prove their fees are reasonable.
Ocean carriers billed US shippers enormous sums in delay-related fees during recent supply-chain disruptions, and regulators responded with tougher rules. This guide explains the current legal framework. It also sets out the practical playbook importers and exporters can follow when an invoice looks inflated.
What Are Demurrage and Detention Charges?
Demurrage is the fee a carrier or marine terminal assesses when an import container occupies terminal space after its free time expires. In contrast, detention, often called per diem, applies when you keep the carrier’s container or chassis outside the terminal beyond the allowed period. Free time comes from the carrier’s tariff or your service contract, so the clock runs from terms you may be able to negotiate.
Both fee types exist to keep cargo moving. However, they became a flashpoint during the pandemic, when importers paid steep invoices for containers they physically could not retrieve or return. Consequently, Congress and the Federal Maritime Commission rewrote the rules.
Common Grounds to Challenge Demurrage Fees
Many demurrage fees collapse under scrutiny. Before you dispute demurrage charges, check the invoice for these recurring defects:
Miscalculated free time. The invoice ignores contractual free days, weekends, or terminal holidays.
Billing during inaccessibility. The terminal was closed, congested, or refusing appointments, so no fee could have incentivized an earlier move.
Missing invoice data. Federal law prescribes minimum invoice contents, and omissions are fatal to the carrier’s claim.
No contractual basis. The billing party cannot point to a tariff or contract term authorizing the fee against you.
Carrier-caused delay. The carrier’s own performance contributed to the delay it now bills for.
Miscalculated free time. The invoice ignores contractual free days, weekends, or terminal holidays.
Billing during inaccessibility. The terminal was closed, congested, or refusing appointments, so no fee could have incentivized an earlier move.
Missing invoice data. Federal law prescribes minimum invoice contents, and omissions are fatal to the carrier’s claim.
No contractual basis. The billing party cannot point to a tariff or contract term authorizing the fee against you.
Carrier-caused delay. The carrier’s own performance contributed to the delay it now bills for.
In addition, responsibility for terminal delays often depends on the sale terms between buyer and seller. Our overview of Incoterms and responsibility for port delays explains who typically bears these costs in international sales.
The FMC Billing Rule Behind Every Demurrage Dispute
Since May 28, 2024, the FMC’s billing rule, codified at 46 CFR part 541, has governed US demurrage and detention invoices. Under the rule, a billing party must issue its invoice within 30 calendar days of the last incurred charge. Furthermore, each invoice must contain the data points required by 46 U.S.C. § 41104(d), such as container numbers, the start of free time, applicable rates, and contact information for seeking mitigation.
The statute gives these requirements real teeth. If an invoice omits required information, 46 U.S.C. § 41104(f) eliminates your obligation to pay that charge. Therefore, a line-by-line invoice audit is always the first step.
One caveat applies. The rule’s original limits on who may receive an invoice, former section 541.4, were set aside in World Shipping Council v. FMC (D.C. Cir. 2025), and the FMC removed that section effective December 29, 2025, as reflected in the Federal Register notice. Nevertheless, the invoicing, content, and dispute-timeline provisions remain fully in force.
How to Dispute Demurrage Charges Step by Step
Here is how to dispute demurrage charges in practice:
Audit the invoice. Compare every line against your service contract, the tariff, and the federally required content list. Flag missing elements and miscounted free days.
Preserve the evidence. Collect terminal screenshots, appointment logs, closure notices, vessel schedules, and emails showing when cargo actually became available.
Submit a written challenge. Under the FMC billing rule, you have at least 30 calendar days to request mitigation, a refund, or a waiver, and the billing party must attempt to resolve the request within 30 days.
File an FMC charge complaint. For unresolved invoices, 46 U.S.C. § 41310 lets you submit the invoice and bill of lading numbers to the Commission. The carrier then bears the burden of proving its fees are reasonable, and the FMC can order refunds.
Escalate to arbitration or court. Service contracts and bills of lading often contain arbitration clauses, and litigation remains available where they do not.
Audit the invoice. Compare every line against your service contract, the tariff, and the federally required content list. Flag missing elements and miscounted free days.
Preserve the evidence. Collect terminal screenshots, appointment logs, closure notices, vessel schedules, and emails showing when cargo actually became available.
Submit a written challenge. Under the FMC billing rule, you have at least 30 calendar days to request mitigation, a refund, or a waiver, and the billing party must attempt to resolve the request within 30 days.
Escalating Beyond the Carrier
File an FMC charge complaint. For unresolved invoices, 46 U.S.C. § 41310 lets you submit the invoice and bill of lading numbers to the Commission. The carrier then bears the burden of proving its fees are reasonable, and the FMC can order refunds.
Escalate to arbitration or court. Service contracts and bills of lading often contain arbitration clauses, and litigation remains available where they do not.
Meanwhile, document every exchange with the carrier and terminal. A clean paper trail is often what decides these claims. These habits also make it easier to dispute demurrage charges quickly when the next invoice arrives.
Port Closures, the Incentive Principle, and the 2026 Evergreen Decision
The FMC’s 2020 interpretive rule, 46 CFR § 545.5, measures demurrage and detention against an incentive principle. In short, fees are suspect when they cannot incentivize cargo movement, for example when a terminal cannot accept a returned container.
The leading test case involved a $510 detention bill for a holiday weekend when the Port of Savannah was closed. After years of litigation, including an earlier remand, the D.C. Circuit upheld the FMC in Evergreen Shipping Agency (America) Corp. v. FMC, 174 F.4th 169 (D.C. Cir. 2026). The court confirmed two points, as described in the Commission’s announcement: these fees must actually promote freight fluidity, and carriers must produce evidence, not assertions, to justify them as compensation.
As a result, invoices covering days when equipment could not move are now among the most vulnerable to challenge.
Charterparty Demurrage Is Different
Bulk and breakbulk traders should note a separate regime. Under a voyage charter, demurrage is liquidated damages the charterer owes when loading or discharge exceeds the agreed laytime. These claims turn on the charterparty’s terms rather than FMC rules. Moreover, charterparties commonly impose strict documentary time bars, sometimes as short as 30 to 90 days, so supporting documents must be presented quickly.
Accordingly, that dispute path usually runs through the contract’s arbitration clause, frequently seated in London or New York, rather than through the Commission.
Frequently Asked Questions
Start with a written request for mitigation, refund, or waiver within 30 days of the invoice, supported by your contract terms and terminal evidence. If the carrier refuses, you can file an FMC charge complaint, where the carrier must prove its fees are reasonable.
The FMC billing rule gives billed parties at least 30 calendar days from the invoice date to challenge the fees. The billing party must then attempt to resolve the request within 30 calendar days of receiving it.
Usually not. The FMC’s incentive principle treats fees as unreasonable when no pickup or return was possible. In 2026, the D.C. Circuit upheld an FMC ruling that detention billed over a holiday port closure violated the Shipping Act.
No. Under 46 U.S.C. § 41104(f), an invoice that omits federally required information eliminates the billed party’s obligation to pay that charge. However, you should still respond in writing and preserve your evidence.
Conclusion
Demurrage and detention no longer favor the carrier by default. Between the FMC billing rule, statutory invoice requirements, the incentive principle, and the 2026 Evergreen decision, US importers and exporters hold real leverage against unreasonable fees. Nevertheless, deadlines arrive fast, and the strongest claims are built on records preserved early, which is where our international trade practice focuses first.
If demurrage, detention, or per diem invoices are cutting into your margins, Transnational Matters PLLC can help you evaluate the remedies described above and pursue the ones that fit. Contact our team to schedule a consultation tailored to your shipments and contracts.
