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Monday Morning eBriefing

Ports of LA/Long Beach to Reconsider Container Dwell Fee June 3

May 30, 2022 by Luke Zimmer
The ports of Los Angeles and Long Beach have continued to postpone their “Container Dwell Fee,” and said they will reconsider its possible imposition on June 3. 
 
The executive directors of both ports will reassess fee implementation after monitoring data over the next week. Fee implementation has been postponed by both ports since it was announced on Oct. 25, but it remains a threat to the industry.
 
Under the temporary policy approved Oct. 29 by the Harbor Commissions of both ports, ocean carriers can be charged for each import container that falls into one of two categories: In the case of containers scheduled to move by truck, ocean carriers could be charged for every container dwelling nine days or more. For containers moving by rail, ocean carriers could be charged if a container has dwelled for six days or more.
 
The fee has been set at $100 per container, increasing in $100 increments per container per day of excess dwell time beyond the prescribed period.
 
The port authorities have stated the fees collected from dwelling cargo will be “reinvested for programs designed to enhance efficiency, accelerate cargo velocity and address congestion impacts.”
 
Meanwhile, NVOCCs should contact their ocean carriers to determine which category their cargo falls under and how/if they will be charged the fee.
 
NCBFAA Transportation Counsel Venable anticipates that VOCCs will begin to offset this charge and pass it along to NVOCCs, subject to the 30-day waiting period for tariff rate increases as required by the Shipping Act. NVOCCs have several options for mitigating the charge including (i) amending their Negotiated Rate Arrangements (NRAs) with shippers to pass through the charges; (ii) amending their NVOCC Service Arrangement (NSAs) with shippers to offset the charges; and (iii) updating their tariffs to offset the charges, subject to the waiting period. These amendments and changes to mitigate the charges must be made in a form compliant with the Shipping Act and Federal Maritime Commission (FMC) regulations.