Container detention charges have never been a popular impost
among cargo interests. With long term lease costs on a general
purpose TEU as low as a dollar a day, detention charges of A$15 or
A$20 seem, at first blush, to be excessive.
This battle has escalated to outright warfare over the last
week, with the Victorian Transport Association describing the
charges as "a real money gouge by the shipping lines" and
contemplating establishing a fighting fund to facilitate legal
challenges to detention charges. Of particular interest to the VTA
appears to be detention charges levied in circumstances where the
delayed return of the container is brought about by congestion at a
line's contracted depot.
The specific contractual basis for imposing container detention
charges varies from line to line, but most follow a similar
pattern. The line specifies a number of free days, after which the
import container must be returned, clean and empty, to the
line's nominated depot. If the importer complies, no detention
is charged. However, if the importer fails to return the container
within time, the line's detention tariff for late return
This contractual base has a number of points of vulnerability,
which are increasingly attacked by importers and forwarders who are
aggrieved by the levels of detention charged.
Lines have an opportunity to structure their documentation in
such a way as to maximise the recoverability of detention charges.
As overseas principals sometimes charge local agents for detention,
whether or not the local agent collects the charges from the
importer, it is very much in both the line's - and the
agent's - interests to ensure the documentation is in good
Middletons has many years' experience working with lines to
develop effective detention clauses and contracting processes,
which have enabled our clients to collect substantial sums and
defeat or deflect customer resistance. In light of the current
climate in Victoria, there has never been a better time to review
your own systems.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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