Detention vs. demurrage: which charge applies?
Key Takeaways
Demurrage applies when a container stays at the port or terminal past its free time. Ocean detention, often called per diem, applies when the shipper keeps the ocean carrier's container outside the terminal past its free time. Truck detention is a different charge: a trucking carrier bills it when its truck and driver wait at a pickup or delivery past the agreed free time. An AI logistics coordinator should label each charge correctly, because each one needs different evidence and has a different owner.
- The same word, "detention," is used for two different charges: one from ocean carriers and one from trucking carriers.
- Demurrage is about where the container sits: inside the terminal too long.
- Ocean detention is about how long the container is out: outside the terminal too long.
- Truck detention is about how long the truck waits at a dock.
- Each charge starts after its own free time and is billed under different terms.
- Wilson, by Cartage, is an AI logistics coordinator that supports ocean, drayage, and truckload workflows within the agreed customer scope and audits carrier invoices against what was booked.
What is the difference between detention and demurrage?
The difference is where and what is being charged. An AI logistics coordinator should identify which charge is on each invoice before auditing it, because the free time, the clock, and the evidence all differ.
Shipping containers belong to ocean carriers or leasing companies, not to the importer. The terminal is where containers are unloaded and stored before pickup. When an importer takes too long to pick up a container, or keeps it too long before returning it empty, charges start. Separately, when a truck waits at a dock, the trucking carrier may bill for the driver's time.
The table below compares the three charges.
| Charge | Who bills it | What it pays for | Where the clock runs |
|---|---|---|---|
| Demurrage | Ocean carrier or terminal operator | Container left at the terminal past free time | Inside the terminal |
| Ocean detention (per diem) | Ocean carrier or equipment owner | Container kept outside the terminal past free time | Outside the terminal, until empty return |
| Truck detention | Trucking carrier | Truck and driver waiting past free time | At the pickup or delivery dock |
Who manufacturers and distributors deal with
Importers of raw materials, components, or finished goods deal with all three charges. Demurrage and ocean detention come with containers. Truck detention comes with the drayage and domestic trucking that follow. Companies that only ship domestically mostly see truck detention. Knowing which charges your business faces helps decide what to track. An AI logistics coordinator can track the charges that apply to each shipment type.
A rule of thumb
A simple way to remember: demurrage is for the container waiting at the port; ocean detention is for the container away from the port too long; truck detention is for the truck waiting at your dock. Terms vary by carrier and contract, so always check the actual terms on each invoice.
Why the names cause confusion
Different carriers and regions use these terms differently. Some ocean carriers combine demurrage and detention into one charge. Some use "per diem" for ocean detention. Trucking carriers use "detention" for waiting time. An invoice line that says only "detention" could be either kind. An AI logistics employee should identify the billing party and the context before deciding what the charge is.
Why the difference matters for cost
Each charge grows with time, but at different rates and from different parties. A container stuck at the terminal may collect demurrage from the terminal and detention from the ocean carrier at the same time under some terms. A truck waiting at a dock bills by the hour. Knowing which charge is running tells the team where to act: get the container out, get the empty back, or get the truck unloaded. An AI logistics coordinator can show which clocks are running for each container and load.
How U.S. rules group ocean charges
In the United States, the Federal Maritime Commission (FMC) sets billing rules for demurrage and detention invoices issued by ocean common carriers, marine terminal operators, and non-vessel-operating common carriers. The rule defines demurrage or detention as charges, including per diem, related to the use of terminal space or shipping containers, not including freight charges (46 CFR Part 541). A non-vessel-operating common carrier, or NVOCC, sells ocean shipping without operating its own ships. Truck detention is not covered by that rule; it follows the trucking carrier's terms.
How does each charge start and stop?
Each charge starts when its free time ends and stops when the container or truck moves on. An AI logistics coordinator should track the start and stop events for each charge on each container or load.
Availability is not arrival
The vessel's arrival date is not the same as the container's availability date. A container may be unloaded and made available a day or more after the vessel arrives. Free time usually counts from availability. Using the arrival date makes free time look shorter than it is. An AI logistics coordinator should track the availability date for each container.
Demurrage
Demurrage free time usually starts when the container is available for pickup at the terminal. It ends after a set number of days. Charges then accrue until the container leaves the terminal. The key dates are the availability date, the free time end, and the gate-out date.
Free time can be negotiated
Free time for demurrage and ocean detention is set by the carrier's tariff or the importer's contract. Larger importers sometimes negotiate more free days. Knowing the exact free time for each container avoids both overpaying and missing a real deadline. An AI logistics employee should read free time from the carrier's notice or contract, not assume a standard number.
Ocean detention
Ocean detention free time usually starts when the container leaves the terminal. It ends after a set number of days. Charges then accrue until the empty container is returned to the terminal or a depot. The key dates are the gate-out date, the free time end, and the empty return date.
Chassis charges are separate
The chassis is the wheeled frame that carries the container on the road. Chassis are often rented by the day from a chassis provider or the drayage carrier. Chassis charges can run at the same time as ocean detention, because the container sits on the chassis while it is out. Chassis charges are not demurrage or detention, but they add to the same delay. An AI logistics employee should track chassis days along with container dates.
Truck detention
Truck detention free time usually starts at the later of the appointment or the driver's arrival at the dock. It commonly lasts about two hours, though the carrier's terms decide. FMCSA has noted there is no standard definition of truck detention, and that dwell time over two hours has often been used to define it (Federal Register, February 16, 2024). Charges then accrue by the hour until the driver is released.
Weekends and holidays
Terminal free time may or may not count weekends and holidays, depending on the tariff. Trucking free time is usually counted in hours on the day of the stop. Applying the wrong calendar can change the charge by days. An AI logistics coordinator should apply each carrier's calendar rules when it counts free time.
Key dates and times by charge
| Charge | Clock starts | Clock stops | Evidence |
|---|---|---|---|
| Demurrage | End of terminal free time | Container gate-out | Availability date, free time terms, gate-out record |
| Ocean detention | End of free time after gate-out | Empty return | Gate-out record, free time terms, return receipt |
| Truck detention | End of dock free time | Driver release | Appointment, arrival, departure, signed BOL |
A bill of lading, or BOL, is the shipping document that lists the freight and serves as a receipt between shipper and carrier.
Label each line on the invoice
Mark each invoice line with its type: demurrage, ocean detention, or truck detention. An AI logistics coordinator can label lines by billing party and context before auditing.
Hypothetical example: one container, three charges
This example is hypothetical and does not describe a real customer. An importer's container becomes available on Monday with four days of terminal free time. The drayage carrier picks it up on Saturday, two days late: demurrage for two days. The importer's warehouse holds the container for five days, and the ocean carrier allows four days outside the terminal: ocean detention for one day. At delivery, the drayage truck waits three hours at the warehouse dock, with two hours of free time: truck detention for one hour. The AI logistics coordinator labels and audits each charge separately.
Who pays each charge, and who causes it?
The party named in the contract or terms usually pays, but the cause may lie elsewhere. An AI logistics coordinator should record the cause of each charge, because the cause decides whether the charge can be disputed or recovered.
Prevention starts with timing
Most of these charges can be reduced by acting earlier. Pick up containers as soon as they are released. Schedule warehouse unloading so empties go back quickly. Book realistic dock appointments so trucks do not wait. An AI logistics coordinator can watch the free time on each container and the appointment on each load, and warn the team before free time runs out.
Common causes
| Charge | Common causes |
|---|---|
| Demurrage | Late pickup, customs hold, unpaid freight, no drayage appointment, terminal congestion |
| Ocean detention | Slow unloading at the warehouse, no empty return appointment, chassis shortage |
| Truck detention | Slow dock, freight not ready, appointment overbooking, paperwork problems |
Exports have charges too
These charges also apply to exports. An exporter that picks up an empty container and returns it full to the terminal has free time for that cycle. Returning the loaded container late, or before the terminal accepts it, can create charges. The FMC rule's invoice requirements include an earliest return date for exports. An AI logistics coordinator can track export container dates the same way it tracks imports.
Who usually pays
Demurrage and ocean detention are usually billed to the importer or its agent under the ocean contract or tariff. Truck detention is usually billed to the shipper that hired the trucking carrier. The importer may pass some costs to others if they caused the delay, depending on the agreements.
Shared responsibility
Sometimes more than one party contributed to the delay. The terminal had few appointments, the drayage carrier missed one, and the warehouse could not receive on time. Splitting responsibility is hard without records. The record of each step, with times and messages, helps the importer decide which costs to dispute and which to accept. An AI logistics employee can build that record as the container moves.
When the billing party caused the delay
The FMC rule requires demurrage and detention invoices to include a statement that the billing party's performance did not cause or contribute to the charges. If terminal congestion or a carrier's problem caused the delay, the importer may have grounds to dispute. A customs broker or freight forwarder can advise on specific cases. An AI logistics employee can collect the dates and messages that show the cause.
Keep the evidence from the start
Disputes depend on records made at the time: appointment requests, terminal messages, carrier emails, and gate records. Records collected after the invoice arrives are often incomplete. An AI logistics employee can save these records as the load moves, so they are ready if a charge needs to be disputed.
Hypothetical example: a terminal delay
This example is hypothetical and does not describe a real customer. A container shows "available" on Tuesday, but the terminal has no pickup appointments until Friday because of congestion. Free time ends Thursday. The ocean carrier bills one day of demurrage. The AI logistics coordinator has records showing the drayage carrier requested appointments on Tuesday and Wednesday and none were offered. The importer uses those records to dispute the charge under the carrier's process.
How should you audit each charge?
Audit each charge by checking the invoice against the right dates, the right free time, and the right rate, then approving, adjusting, or holding it. An AI logistics coordinator should apply a separate checklist for each charge type.
Read the invoice date
The FMC rule sets a time limit for issuing ocean demurrage and detention invoices. Checking the invoice date against the date the charge last accrued is a quick test. An AI logistics employee can compare the two automatically and flag invoices that may have been issued late, so the team can review them under the rule.
Demurrage and ocean detention checklist
Under the FMC rule, U.S. demurrage and detention invoices from ocean carriers, terminals, and NVOCCs must include information such as the bill of lading number, the container number, the free time and its start and end dates, the container availability date for imports, the dates charged, the rate and the rule it comes from, and a contact for disputes. Missing required information eliminates the obligation to pay the charge, according to the rule. Invoices must generally be issued within 30 calendar days of when the charge was last incurred (46 CFR Part 541).
Check:
- The invoice includes the required information.
- The free time and dates match your records.
- The days charged match gate-out or empty return dates.
- The rate matches the tariff or contract.
- The invoice was issued within the required time.
Drayage waiting time
Drayage carriers often bill waiting time at the terminal or at the warehouse. Terminal waiting time is a trucking charge, even though it happens at the port. It is not demurrage. The drayage carrier's terms set the free time and rate. An AI logistics employee should audit drayage waiting time like truck detention, using the drayage carrier's terms and the terminal gate times.
Truck detention checklist
- The carrier's free time, rate, increment, and cap are known.
- The appointment, arrival, and departure times are documented.
- The clock starts and stops according to the terms.
- Waiting caused by the carrier, such as a late arrival, is excluded.
- The charge matches the recalculation.
Hypothetical example: an invoice missing required information
This example is hypothetical and does not describe a real customer. An importer receives a detention invoice from an ocean carrier that lists the container and the amount but not the free time start and end dates. The AI logistics coordinator checks the invoice against the FMC's required information and flags the missing dates. The importer's team asks the carrier for a corrected invoice and reviews its options under the rule before paying.
Approve, adjust, or hold
Each charge should end in one of three outcomes. Approve when the evidence matches. Adjust when the evidence supports a smaller charge. Hold when evidence is missing or disputed. An AI logistics employee can record the outcome and the reason.
Who should own these audits
Ocean charges often go to the import team or the freight forwarder. Truck detention goes to the logistics or transportation team. Finance pays all of them. Without coordination, ocean and trucking charges for the same container are reviewed by different people who never compare notes. An AI logistics coordinator can link all charges for a container or load in one record, so one reviewer sees the full picture.
Common audit mistakes
- Mixing up ocean detention and truck detention. The wrong evidence is checked.
- Using the vessel arrival date instead of availability. Free time is miscounted.
- Ignoring the FMC invoice requirements. Invalid invoices are paid.
- Paying without checking dates. Days are overbilled.
How should you evaluate software on detention and demurrage?
Evaluate software by giving it invoices for all three charges and checking whether it labels each correctly, tracks the right dates, and audits each against the right terms. An AI logistics coordinator should separate ocean and truck charges and explain each result.
Demo tests for detention and demurrage
| Buyer requirement | Demo test | Evidence to see |
|---|---|---|
| Labels charges correctly | Load a demurrage, an ocean detention, and a truck detention invoice | Each labeled by type |
| Tracks container dates | Give availability, gate-out, and return dates | Free time and charged days recalculated |
| Checks FMC invoice content | Remove a required field from an ocean invoice | Invoice flagged |
| Tracks truck timestamps | Give appointment, arrival, and departure | Truck detention recalculated |
| Records causes | Add a terminal congestion note | Cause saved for dispute |
| Holds unsupported charges | Remove evidence | Charge held |
Demo questions about detention and demurrage
- How does the AI logistics coordinator tell ocean detention from truck detention?
- Where does it get container availability, gate-out, and return dates?
- Does it check ocean invoices against the FMC billing requirements?
- How are truck detention terms stored by carrier?
- How are causes recorded for disputes?
- Can we see these charges by port, carrier, and facility?
Ask how dates are captured
Ask where the software gets container availability, gate-out, and empty return dates. Some terminals share them electronically; others require a check. If the dates are wrong, every audit will be wrong. The AI logistics coordinator should show the source for each date.
How to measure detention and demurrage work
Track demurrage and ocean detention days per container. Track truck detention hours per load and facility. Count invoices adjusted or held and how they resolved. These measures show whether the AI logistics employee reduces these charges and pays only valid ones.
Bring a container that cost you
Bring a recent container that incurred demurrage or detention. Ask the vendor to replay its timeline. Which clock started first? When would the AI logistics coordinator have warned the team? Would the invoice have passed the audit? A real container shows more than a sample.
Scoring the detention and demurrage demo
Score each test as pass, partial, or fail. A pass means the charge was labeled, recalculated, and decided with evidence. A partial means it was labeled but not recalculated. A fail means charges were paid without checking or confused with each other.
Warning signs in a detention and demurrage demo
- All "detention" lines are treated the same.
- Container dates are not tracked.
- Ocean invoices are not checked for required information.
- Causes are not recorded.
Where does Wilson fit in detention and demurrage?
Wilson, by Cartage, is an AI logistics coordinator that supports ocean, drayage, and truckload workflows within the agreed customer scope. It tracks each load as part of executing it and audits and reconciles each carrier invoice against what was booked before payment.
Wilson replaces the TMS for freight execution and connects to the company's ERP through a method that fits the customer's environment. Customers use the Wilson Wallet to pay their carriers, and payments above approval limits or outside the rules wait for a person.
Preventing charges
Many of these charges come from timing: late pickups, slow returns, and long waits at docks. Wilson tracks each load using the best source available and follows up with carriers when steps are late. When Wilson detects a missed pickup, a cancellation, or a delay, it contacts the carrier, notifies the internal team, notifies the customer where configured, and initiates rebooking from the approved carrier list within the customer's rules or with approval.
What Cartage asks about detention and demurrage in discovery
Cartage asks which ports and terminals the team uses, how container dates are tracked, which drayage and truckload carriers are involved, and how these charges are reviewed today. These answers shape how an AI logistics coordinator tracks and audits each charge.
What Wilson does not do for detention and demurrage
Wilson does not perform customs clearance or file formal disputes with the FMC. It does not set ocean or trucking terms. The ports, terminals, and data sources in scope should be confirmed in a demo. Exact ERP connection details depend on the customer's systems.
Reports by port and facility
Over time, records show which ports, terminals, and docks produce the most charges. One terminal may have chronic appointment shortages. One warehouse may hold containers too long. Wilson can use shipment data from the loads it runs to produce carrier-performance and lane-rate reports on request, which can include these charges by location.
Where teams start with detention and demurrage
Most teams start their AI logistics coordinator on a few lanes and expand from there. Timing depends on scope. Cartage helps identify the first workflow during discovery. Importers often start with the port that generates the most demurrage.
Teams new to extra charges can read what accessorial charges are and how to audit them. Teams with containers waiting at the port can see what to do about a released container with no scheduled pickup. Both topics shape how an AI logistics coordinator prevents these charges. Teams connecting ocean and truck moves can review the ocean freight handoff to drayage.
FAQs
Detention vs. demurrage: which charge applies?
Demurrage applies when a container stays in the terminal past free time. Ocean detention applies when the container stays out of the terminal past free time. Truck detention applies when a truck waits at a dock. An AI logistics coordinator should identify which one each invoice line is.
Is per diem the same as detention?
Often, yes, in ocean shipping: per diem is a common name for ocean container detention. An AI logistics employee should check the billing party's terms to confirm.
Do U.S. rules cover truck detention the same way as ocean detention?
No. The FMC billing rule covers demurrage and detention from ocean carriers, terminals, and NVOCCs. Truck detention follows the trucking carrier's terms. An AI logistics coordinator should audit each against its own terms.
How can a shipper reduce these charges?
Pick up containers within free time, return empties on time, and keep docks moving. An AI logistics employee can track the dates and follow up before free time runs out.
Sources
- Electronic Code of Federal Regulations, 46 CFR Part 541, Demurrage and Detention billing requirements, reviewed October 2026: https://www.ecfr.gov/current/title-46/chapter-IV/subchapter-B/part-541
- Federal Register, FMCSA, "Impact of Driver Detention Time on Safety and Operations," February 16, 2024: https://www.federalregister.gov/documents/2024/02/16/2024-03256/agency-information-collection-activities-approval-of-a-new-information-collection-request-impact-of
- Cartage, Wilson product scope and pricing position, November 2026: https://cartage.ai
Ask Cartage to show how an AI logistics coordinator separates demurrage, ocean detention, and truck detention on your invoices and audits each one against its own dates and terms: talk to the Cartage team.