Four words, four clocks

Carriers describe charges for keeping a container beyond an agreed period with several terms, and they are not interchangeable. One carrier’s published terms define detention as the charge for keeping its container inside a terminal, port or depot past the agreed free time, and demurrage as the charge for the same overrun when the container is outside those facilities. The terms also describe a combined form, and free time as the window agreed between the carrier and the merchant before charges apply.

That definition is one carrier’s, written for its own business, and the same words may be arranged differently elsewhere. The lesson is not the particular definition. It is that the words describe different clocks, started and stopped by different events, and that a bill can contain two or more.

What to establish, in order

  1. What starts each clock? Discharge from the vessel, gate-out from a terminal, arrival at a depot: the trigger differs by charge and by location.
  2. What stops it? Return of the empty container to a nominated depot is a common stopping event for equipment charges, but confirm which depot and which document records it.
  3. How many free days apply, and are they calendar or working days? The number is agreed in the booking or set by the carrier’s terms for that location. There is no standard figure that applies everywhere.
  4. Which party is the merchant? The party named in the transport document and the party paying may differ, and the terms follow the contract of carriage.
  5. What is charged after free time ends? Ask for the tariff that applies to the location and the equipment type, in writing, with the currency.

Why location and contract matter

The same carrier publishes different arrangements for different countries, and it states that charges can be invoiced separately or combined depending on location. Governing law and jurisdiction follow the contract of carriage. For a shipper or consignee this means that the terms attached to your booking are the ones that count, not a general understanding from a previous shipment on another route.

Storage is a related but separate matter. A terminal or warehouse can charge storage for cargo left on its premises, under its own tariff, whether or not equipment charges are also running. Do not assume one clock replaces another.

A hypothetical timeline

Hypothetical timeline, invented for illustration only. No free-time length is implied.

Day 0: the vessel discharges the container at the port. Day 3: the importer’s documents are complete and the declaration is filed. Day 6: customs release is granted. Day 7: the container is collected from the terminal and delivered to the consignee’s warehouse. Day 9: the container is unloaded. Day 11: the empty container is returned to the nominated depot.

In this invented sequence several clocks could have been running at different times: terminal storage from discharge, container charges while the container sat outside the terminal, and equipment charges until the empty returned. Whether any of them produced a charge depends entirely on the free time written for that booking.

Delays that move the clock

  • Documents that are not ready when the cargo is discharged.
  • A declaration routed for inspection, which adds days between filing and release.
  • A consignee’s warehouse that cannot receive on the day the container arrives.
  • An empty container that cannot be returned because the depot is full or closed.

Each of these is a reason to start the document consistency work early and to confirm the delivery date with the receiver before the vessel arrives.

What to ask for before booking

  • The free time for each charge, in days, and whether days are calendar or working.
  • The event that starts and stops each charge.
  • The tariff after free time, by equipment type and location, and its currency.
  • The depot for returning the empty, and how the return is evidenced.
  • Who is invoiced, and what the quotation does and does not include.

A worked checklist for the first booking

If you are booking for the first time on a route, ask for five things in writing before you confirm: the free time for each charge in days, the depot where the empty must be returned, the cut-off for returning it, the tariff after free time, and the person who can extend free time when a delay is not your fault. Many disputes begin because one of these was assumed.

Then put the dates in a calendar the whole team can see: the discharge date, the end of each free period, and the return date. A date that exists only in one person’s head is a date that gets missed.

When a delay is not yours

Sometimes the clock runs because of something outside your control: a terminal closure, an inspection ordered by an authority, a delay in the carrier’s release. Record the cause and the dates at once, keep the notices you receive, and ask in writing whether the carrier will adjust the period. Whether it does depends on its terms and on the cause, but a request made with a record is far easier to assess than one made months later from memory.

Limits of this guide

This article explains concepts and does not state any carrier’s current free time or tariff. The carrier page cited is an example of one carrier’s terms and is not universal. Check the terms that apply to your booking and the date of your shipment; a current page does not show what applied at an earlier date. A forwarder’s own conditions govern its service separately.

Sources