What is the difference between demurrage and detention fees?
Both demurrage and detention are fines for the shipper or consignee delaying or keeping a container, but they are used in different contexts and applications. For example, demurrage fees are assessed for delays within the port, whereas detention fines are applied for delays outside the port. The rules and conditions for demurrage and detention differ by country. Here are further details about each.
Example applied in some European ports:
Container demurrage fees:
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Definition: Demurrage fees are charged when containers remain inside the port beyond the free time given by the shipping line.
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Who Pays: The client (shipper or consignee).
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To Whom: Paid to the shipping line.
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When to Pay: Before the cargo departs from the port.
Container Detention Fees:
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Definition: Detention fees apply when containers are held outside the port beyond the free time granted by the shipping line.
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Who Pays: The client (shipper or consignee).
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To Whom: Paid to the shipping line.
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When to Pay: Before or after the container is returned to the shipping line's possession.
Example Applied in Egyptian Ports:
Demurrage Fees:
- Definition: Demurrage fees are charged when containers are held by the consignee, either inside or outside the port, beyond the free time the shipping line grants.
- Who Pays: The consignee.
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To Whom: Paid to the shipping line.
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When to Pay: Before the goods leave the port.
Detention Fees:
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Definition: Detention fees apply when the shipper holds containers, either inside or outside the port, beyond the free days granted by the shipping line.
- Who Pays: The Shipper.
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To Whom: Paid to the shipping line.
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When to Pay: Before the containers are loaded onto the ship.
Additional Information:
The foregoing shows that
demurrage and detention fees differ regarding conditions, regulations, and applicability from one country to the next. However, demurrage and detention fees are not the same as port storage fees, which are imposed by port operators after the container's free storage days have ended. Storage fees are paid to the port and are not tied to the shipping line.
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