Hapag-Lloyd comes under fire due to ‘unfair’ D&D charges, complaint filed

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German shipping colossus Hapag-Lloyd has been indicted for levying ‘unfair’ demurrage and detention (D&D) charges, by fruit juice importer Rahal International. The shipper filed a complaint with the U.S. Federal Maritime Commission (FMC) while claiming that Hapag issued almost USD 300,000 in D&D charges for empty containers.

According to the information available, the carrier created logistical paralysis at the port of New York and New Jersey and “wrongfully and unreasonably” charged Rahal with the said amount in D&D. The shipper’s lawyers also allege that Hapag was unwilling and/or able to handle the return of its empty containers, yet continued to accept business

“As a result of Hapag’s failure to establish reasonable practices regarding the return of empty containers, Hapag had a backlog of empty containers building up in and about the port,” Rahal International’s claim read.

It is being claimed that Hapag’s charges are not compliant with the U.S. Shipping Act 1984, and have resulted in direct and proximate damage of at least USD 715,631 to the shipper. Apart from the D&D, Rahal also had to pay USD 154,909 in haulage fees, and USD 63,013 for extra expenses, as well as a USD 198,798 loss for spoiled fruit products.

Since the beginning of 2022, the FMC has been dealing with a flood of complaints filed by shippers against ocean carriers. The allegations often allege that ocean carriers violated the Shipping Act of 1984 by failing to honor long-term contract prices and instead providing space on containerships to other parties at substantially higher rates, as well as charging unjustified demurrage fees.