What Are Demurrage and Detention? The Difference and How to Avoid Them
Demurrage and detention are delay charges paid to the carrier for using a container beyond the free time.
What Are Demurrage and Detention? The Difference and How to Avoid Them
Demurrage and detention are delay charges paid to the carrier for using a container beyond the free time. The two are often confused but refer to different situations.
What is Demurrage?
It is the charge paid when a full container is kept in the port or terminal beyond the free time. Typical causes are delays in customs procedures on import, non-payment or missing documents.
What is Detention?
It is the charge applied when a container is taken out of the terminal and used outside the port beyond the free time, or when its return empty is delayed.
How can they be avoided?
- Clarify the number of free days and the tariffs at the quotation stage.
- Prepare the documents (bill of lading, invoice, packing list) and customs procedures before the vessel arrives.
- Complete the delivery order and payment procedures on time.
- Plan unloading and container return in advance.
Calculation
Charges are calculated from the day the free time ends, on a daily stepped tariff, and vary by container type. Current tariffs should be obtained from the carrier.
Frequently asked questions
How many days is the free time?
It varies by carrier, port and container type; it is usually between a few and ten days. It is stated in the booking confirmation.
Are demurrage and detention applied at the same time?
No. Demurrage applies while the container is at the terminal; detention applies after it has left the terminal.
Can the charges be disputed?
If the delay is caused by the carrier, it can be disputed; therefore it is important to keep all correspondence and time records.