Demurrage and detention are the charges a carrier or terminal raises when a container sits in the terminal, or stays out of it, longer than the free time allows. For a shipper they are an annoyance. For a freight forwarder they can be a balance-sheet problem, because the carrier bills the party named on its bill of lading, and on a consolidated or house-bill shipment that party is often the forwarder, not the cargo owner. The key takeaway: the carrier does not care who your customer is; it bills the merchant it can find, and you may be that merchant. Protection comes from three things done before the box lands: contract terms that make the customer liable, a free-time calendar per container, and a clear record of why any charge accrued. The shipper-side mechanics are covered in our guides to container damage, detention and per diem and the FMC invoice rules. This post is about the forwarder's side of the ledger.
Who does the carrier actually bill?
Carriers bill under their bill of lading terms, not under your customer contract. Those terms typically define a broad "merchant" and make every person in that definition liable together. As one example, the Maersk Terms for Carriage (as published online, October 2026 check, no version date shown) define "Merchant" to include the shipper, holder, consignee and receiver of the goods, and make everyone within the definition jointly and severally liable to the carrier for the merchant's obligations. Separate clauses in the same terms put detention and storage costs on the merchant. Other carriers use similar wording, so read the terms of the carriers you use most.
What that means in practice depends on whose name is on the document:
- You booked as agent and the carrier's bill names your customer as shipper. The carrier's first call is your customer. You are more likely to be a bystander, though you can still be chased if you gave the instructions or took delivery.
- You booked the master bill in your own name (typical for consolidation, or when you ship as principal). You are the shipper on the carrier's bill, so you are the merchant, whatever your sales terms say about the end customer.
- You issue a house bill and act as a carrier to your customer. Your own bill now carries your own charges clause, and you owe the master-level charges to the ocean carrier while trying to recover them from the house consignee. See NVOCC vs freight forwarder for why the label matters.
A misconception worth correcting: the FMC rule that once limited US billing to the contracting party or the consignee is gone. The D.C. Circuit set aside 46 CFR 541.4 in World Shipping Council v. FMC (23 September 2025), and the eCFR now shows 541.4 as "[Reserved]". Press reports in May 2026 also described a Maersk settlement with the FMC under which it agreed to narrow its US definition of "merchant" to shippers, consignees and parties with a beneficial interest in the cargo; those reports are secondary, so check the FMC's own release before relying on the detail. Do not assume that "we never contracted with that carrier" is a defence.
How a forwarder ends up holding the bill
Almost every case is a variation of one event: the container could not leave the terminal, or could not come back, on time, and the party who could have prevented it was not the party the carrier billed. The usual causes:
- The consignee refuses or delays. Disputed goods, a price argument, a cash-flow problem, or a buyer who simply stops answering.
- A customs hold or examination. The goods are held for inspection, valuation or a licence query, and free time keeps running. Whether charges should be waived is a mitigation request, not an automatic right.
- No delivery order released. The original bill has not been surrendered, freight or local charges are unpaid, or the telex release was not sent.
- Documents wrong or late. A name mismatch or missing permit holds the box at the quay.
- The empty cannot be returned. Depot closed, no appointment, or the terminal refuses it. Our guide to empty container return covers the proof you need.
- A master bill in your name while the cargo owner is someone you barely know.
Contract protections that move the exposure back
You cannot stop the carrier billing you. You can make sure the customer owes you the same money. The terms below belong in your trading conditions; what trading conditions actually say shows how those documents are usually built, and the clauses should be agreed before the first booking, not after the first invoice.
| Protection | What it does |
|---|---|
| Customer liable for all carrier and terminal charges | States in terms that demurrage, detention, storage and per diem are the customer's cost whoever is billed, including when the forwarder is the merchant on the carrier's bill. |
| Pass-through of the carrier's invoice | Lets you re-bill the charge at cost (plus an agreed admin fee if you want one) on production of the carrier's invoice, without a new quote. |
| Indemnity | The customer indemnifies you for liability arising from its failure to collect, clear or return on time. |
| Lien and right to sell | Lets you hold or dispose of the goods against unpaid charges, to the extent the law of the place allows. See the next section. |
| Deposit or cash against release | For risky cargo or new customers: a deposit sized to a stated number of days of D&D, or release of documents only against payment. |
| Written notice duties | The customer must tell you promptly of any hold, refusal or document problem, and must give instructions within a set time of arrival notice. |
Two cautions. First, a clause that says "customer pays" is only as good as the customer's balance sheet, so pair it with the habits in credit control for forwarders: credit limits, terms by customer and a stop on releasing documents when an account is overdue. Second, if you are acting as an NVOCC in the US trades, your own invoices to the customer are also subject to the FMC's billing rules described below, so write the pass-through to match them.
Early-warning habits that save money
Most D&D that reaches a forwarder is found out on the invoice, weeks after it could have been avoided. The fix is boring and works:
- Keep a free-time calendar per container. For each box record the discharge date, the container availability date, the free days allowed under the carrier's tariff or your service contract, and the last free day (LFD). Count calendar days unless the contract says working days.
- Set alerts at 5, 3 and 1 days before the LFD and give each alert an owner, not a shared inbox.
- Check the terminal, not just the carrier. A container shown as discharged may not be available, or may be on hold. How a container terminal works explains why "discharged" and "collectable" are different statuses.
- Confirm the customer has the arrival notice and the delivery order before the vessel docks, and chase anything unanswered the same day.
- Ask for the return location and appointment early. A refused return costs most when nobody noticed for three days.
- Log the cause when a delay starts. A dated note of what happened (customs hold, depot closed, consignee unresponsive) is the evidence for any later waiver request and for recovering the cost from the right party.
When to dispute a carrier's invoice
For US ocean trades, the FMC's billing requirements rule (46 CFR Part 541) sets what a demurrage or detention invoice must contain. As of October 2026, the eCFR text of 541.6 requires, among other things, the bill of lading and container numbers, the basis on which the billed party is liable, the free time allowed and its start and end dates, the dates charged, the rate and the rule it comes from, a dispute contact, and certifications that the charge complies with FMC rules and that the billing party's own performance did not cause or contribute to it. Under 541.5, an invoice missing required information means the billed party has no obligation to pay that charge.
The timing rules in 541.7 matter just as much to a forwarder:
- The billing party must invoice within 30 calendar days of the date the charge was last incurred, or the billed party need not pay.
- An NVOCC billing a customer must do so within 30 calendar days of the date of the invoice it received. If you are an NVOCC, that is your clock; if the carrier's invoice reached you late, the question is whether you can still pass it on.
- If the invoice went to the wrong party, a corrected invoice must reach the right one within the same 30 days from when the charge was last incurred.
- Under 541.8 the billed party must be given at least 30 calendar days from the invoice date to ask for mitigation, refund or waiver, and the billing party must try to resolve the request within 30 days of receiving it.
Part 541 binds ocean carriers, marine terminal operators and NVOCCs as billing parties. A forwarder that is none of those is not a billing party under it, but it can still use the rule as a checklist when a carrier's invoice arrives, and should require the same detail from anyone billing it. The rule covers US trades only: for other countries, rely on the carrier's tariff and your contract, and check the local regulator. The full list, and what changed in 2025, is in our guide to the FMC invoice rules. The separate unreasonable-practices standard (46 CFR 545.5) is the basis for arguing that a charge served no purpose when the container could not move.
Tracking the clocks per customer
A single container-level calendar tells you what is about to cost money. A per-customer view tells you who keeps costing it. Add three fields to the same sheet or system: the amount of D&D the carrier billed, the amount re-billed to the customer, and the amount actually recovered. Review monthly. A customer whose re-billed amounts are routinely unpaid, or whose containers regularly run past the LFD, needs a deposit, tighter terms or a conversation about whether the account is worth having. Total exposure at any moment is the sum of containers past their LFD with no confirmed customer action; that number should be on the manager's screen.
What to do when the consignee has disappeared
If the consignee will not answer, start the paper trail first and the argument second. Tell the shipper in writing that the cargo is not being collected, ask for instructions (return to origin, sell, or abandon), and ask the carrier whether it will agree to a re-delivery or a change of destination. Meanwhile, charges keep running against whoever the carrier can bill. Rights over the goods, including any lien and the process for selling them, depend on your contract and the law where the cargo sits, and they take notice periods that cannot be skipped. Our guide to abandoned cargo and the forwarder's lien sets out the steps. The earlier you start, the smaller the bill you will be trying to recover.
What to do next
- Read your standard trading conditions and confirm they make the customer liable for demurrage, detention and storage, allow pass-through at cost, and include an indemnity and a lien.
- Build a free-time calendar per container with alerts at 5, 3 and 1 days before the last free day, each with a named owner.
- For new or risky accounts, require a deposit or cash against release before you issue the delivery order.
- Check every carrier invoice against 46 CFR 541.6 and 541.7 for US trades, diarise the 30-day windows, and dispute in writing with your dated evidence.
If you are looking for a partner at the other end of a lane who handles clearance and delivery, more than 29,300 logistics companies are searchable by country and service in the CargoLinked directory, and the public requests board lists freight that shippers have posted for forwarders to quote on directly.
This article is general information, not legal, tax, financial or customs advice. Carrier terms, FMC rules and local law change, and the position on a specific dispute depends on the contract and the facts. Confirm current wording with the carrier, the regulator and a qualified adviser. Rule text referred to was checked against the eCFR in October 2026.
