Flexport under scrutiny amid invoice billing allegations

Air and ocean cargo digital forwarder Flexport is under fire for the second time this month for allegedly collecting or attempting to collect millions of dollars in unwarranted detention and demurrage fees. California-based Giti Tire has filed a complaint against Flexport with the Federal Maritime Commission (FMC), an independent federal agency responsible for regulating U.S. international ocean shipping, for attempting to collect $12.3 million in unwarranted fees, according to court documents. Flexport in April sued Giti for the amount, claiming the company did not pay sufficient detention and demurrage fees between 2021 and 2023. [caption id="attachment_57131817" align="alignleft" width="365"] (Courtesy/Bloomberg)[/caption] Giti responded by filing a complaint with the FMC on May 20 charging that the forwarder “refused to provide further documentation validating the invoiced charges,” and that with “ Flexport ’s steadfast refusal to provide any supporting documentation, Giti has no way to assess the accuracy of Flexport’s charges,” according to court documents. The complaint also alleges that Flexport charged Giti for holidays and weekends when the terminal holding its shipments was closed. Merchants pay demurrage charges for the use of a container within a terminal, and pay detention charges for the use of the container outside of the terminal or depot, beyond the period of the shipping contrac t, according to United Nations Trade and Development , a global organization that aids shipping operators in trade regulations. “As mentioned in Flexport ’s April 2024 federal complaint, this was a situation where we tried everything we could for over two years with a customer who refused to pay their obligations,” a Flexport spokesperson told Air Cargo Next . “Flexport considers our legal action a last resort after working hard to minimize charges and work through payment issues. We are confident in our ability to prevail on the merits of our lawsuit.” New York-based fitness company Peloton this month filed a complaint with the FMC saying Flexport “wrongfully and unreasonably [required] Peloton to pay millions of dollars in unreasonable demurrage and detention charges” leading Peloton to hire a third-party logistics firm to move its shipments, costing the company millions of dollars, according to court documents. FMC updates D&D rules “This is such a murky area and is dependent on the port, the ocean carrier, etc.,” air cargo and express consultant Cathy Roberson told Air Cargo Next . “It’s confusing ... but the FMC has established some rules around this.” Effective May 28, detention and demurrage fees will be processed between common carriers and marine terminal operators differently, according to a rule change implemented by the FMC. “Billed parties have at least 30 calendar days to make fee mitigation, refund or waiver requests,” according to a February release from the FMC. “If a timely filed request is made, the billing party must attempt to resolve the matter within 30 calendar days, unless both parties agree to a longer time frame.” Attorneys for Giti Tire told Air Cargo Next they could not comment on ongoing litigation. Giti Tire did not respond to requests from Air Cargo Next for comment on the status of the case. Air Cargo Next has launched a business directory listing cargo carriers, service providers and technology companies. Each category has sub-categories, allowing users to find the right business to meet their needs. Users can also add their businesses to the directory and claim existing entries. Visit the Air Cargo Next Directory here.

Flexport under scrutiny amid invoice billing allegations

Giti Tire, Peloton allege millions in unwarranted charges

Glasgow airport invests $2.8M in cargo equipment, cold chain

E-Jet conversions gain traction with lessors

Related Posts

Challenge Group launches engine dolly at LGG

New de minimis executive action targets Chinese retailers

CVC willing to bump DB Schenker bid after losing to DSV

E-Jet conversions gain traction with lessors

Cargo Facts Free Newsletters

Cargo Facts Connect Podcast

Follow Us

Welcome Back!

Retrieve your password