Update on FMC's Final Rule on Demurrage and Detention Billing Practices

The Federal Maritime Commission's (FMC) Final Rule on Demurrage and Detention (Final Rule) – released on Feb. 23, 2024, and published in the Federal Register on Feb. 26, 2024 – included an unusual deferral of a significant portion of the Final Rule. At the time, the majority of the Final Rule was to become effective on May 28, 2024, except for the contemplated "Contents of Invoice" requirements intended to be promulgated in Section 541.6 that were deferred pending approval of the U.S. Office of Management and Budget (OMB).

On May 13, 2024, the FMC announced that it received OMB approval, and that the provisions will take effect at the same time as the balance of the Final Rule on May 28, 2024. Publication in a Federal Register Notice (FR Notice) followed on May 14, 2024.

With the publication of the FR Notice, OMB has approved all the relevant provisions of the Final Rule, which will now take full effect on May 28, 2024.

The FMC's press release issued in connection with notice of the OMB approval reminded all regulated entities that "invoices issued for demurrage or detention charges from May 28, 2024, must be fully compliant with all requirements of the Commission's [F]inal [R]ule. Entities issuing non-compliant invoices or to the wrong parties are subject to enforcement action."

For questions, please contact the authors or a member of Holland & Knight's Maritime Team.