STB Issues Rail Demurrage Decisions

The Surface Transportation Board (STB) has issued a series of decisions on demurrage and accessorial rules and charges.  IWLA’s Transportation Advisory Council is  currently reviewing these decisions, but the initial reaction is that the decisions make it clear that rail carriers may not simply use demurrage charges as another revenue stream.

In Policy Statement on Demurrage & Accessorial Rules & Charges, Docket No. EP 757, the Board issued a final policy statement that provides the public with information on principles the Board would consider in evaluating the reasonableness of demurrage and accessorial rules and charges.  With the policy statement, the Board intends to facilitate more effective private negotiations and problem solving between rail carriers and shippers and receivers, to help prevent disputes from arising, and to help resolve disputes more efficiently and cost-effectively.

In Demurrage Billing Requirements, Docket No. EP 759, the Board issued a final rule requiring Class I carriers to directly bill the shipper for demurrage when the shipper and warehouseman agree to that arrangement and notify the carrier.  The Board intends the rule to help ensure the responsibility for demurrage is placed on the party in the best position to expedite the loading or unloading of rail cars.

Also, in Demurrage Billing Requirements, Docket No. EP 759, the Board issued a supplemental notice of proposed rulemaking (SNPRM) inviting parties to comment on certain modifications and additions to the proposed requirements for minimum information to be included on or with Class I carriers’ demurrage invoices. The SNPRM proposes to include additional information such as (1) the date range (i.e., the billing cycle) covered by the invoice; (2) the original estimated date and time of arrival and the date and time cars are received at interchange; (3) the ordered-in date and time; and (4) machine-readable data. The Board also invited further comment from the Class I carriers regarding what actions they currently take, and from all stakeholders on what actions Class I carriers reasonably should be required to take, to ensure that demurrage invoices are accurate and warranted. The intent of this proceeding is to ensure that the recipients of demurrage invoices will be provided sufficient information to readily assess the validity of those charges without having to undertake an unreasonable effort to gather information.

The final policy statement will be effective on May 30, 2020, and the final rule in Demurrage Billing Requirements will be effective on June 20, 2020.  Comments on the SNPRM in Demurrage Billing Requirements are due by June 5, 2020, and replies are due by July 6, 2020.

The Board’s decision in Policy Statement on Demurrage & Accessorial Rules & Charges, Docket No. EP 757, may be viewed and downloaded here.  The Board’s final rule in Demurrage Billing Requirements, Docket No. EP 759, may be viewed and downloaded here, and the SNPRM in Demurrage Billing Requirements, Docket No. EP 759, may be viewed and downloaded here.

 

 

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