Customs brokers, forwarders & shippers ask Congress to change rail storage rules

More than seventy trade associations sent the House Transportation and Infrastructure Committee leadership a letter asking for clarification regarding rail storage fees charged as part of international ocean shipping: “Continuing to allow railroads to invoice importers and their agents directly without oversight undermines the purpose and intent of the Shipping Act.”

The May 2nd letter notes that there is a gap in authority between the Surface Transportation Board (STB) and the Federal Maritime Commission (FMC) to regulate these charges: “The lack of clear statutory authority for the FMC to address unreasonable rail storage charges assessed under ocean carrier through bills of lading is a gap that must be clarified.”

The initiative was spearheaded by the National Customs Brokers & Forwarders Association of America (NCB&FAA), the National Industrial Transportation (NITL) League and the National Retail Federation (NRF), and states that rail storage charges should be billed through the contracting ocean carrier and subject to the demurrage and detention invoicing requirements of the Ocean Shipping Reform Act of 2022 (OSRA22).

The letter explains that: “The lack of clear statutory authority for the FMC to address unreasonable rail storage charges assessed under ocean carrier through bills of lading is a gap that must be clarified. The shipping public does not have a contractual relationship with the railroad, nor do they have a regulatory agency to appeal to that clearly oversees the proper conduct or application of these charges. Continuing to allow railroads to invoice importers and their agents directly without oversight undermines the purpose and intent of the Shipping Act.”

The letter adds: “… the railroads’ storage charges under through bills of lading should more appropriately be invoiced through the ocean carriers. Rail storage charges assessed against containers moving in International commerce, an as-yet unaddressed abuse of demurrage charges, should clearly and formally fall within FMC authority through an act of Congress.”

The co-signers ask Congress “to clarify that rail storage charges assessed under ocean bills of lading for through transportation should be billed through the contracting ocean carrier and subject to the OSRA22 demurrage and detention invoicing requirements. This can be accomplished by establishing a new requirement …This would more clearly establish that rail storage charges assessed as part of through international ocean transportation are under the operational authority of the FMC and that any unreasonable charges would be governed by the requirements of OSRA22.”