Demurrage, Storage and Per Diem: A Guide for Canadian Drayage

Quick answer: Two separate clocks run on an import container in Canada. Storage, often called demurrage, is charged by whoever is holding the box, a marine terminal or a CN or CPKC rail ramp, once its free time ends. Per diem, often called detention, is charged by the shipping line that owns or controls the container for keeping its equipment past the line's free days. Each party bills under its own tariff or contract, so a drayage carrier wins disputes by knowing which clock applies, who set it, and what its own records prove.

This guide explains how those charges work for Canadian drayage carriers, who usually bills whom, and how to challenge a charge. It contains no rates or charge amounts: those come from each terminal's, railway's and line's current terms, which change and differ by contract.

Two clocks, two billers

The table describes common arrangements, not rules. Who pays in the end depends on the contracts along the chain: the line's bill of lading terms, the importer's service contract, the forwarder's or broker's terms and your own rate confirmation.

The last free day and how it moves

The last free day is the final day you can collect a loaded import container before storage starts, or return an empty before per diem starts. For storage, the clock is set by the terminal or railway and usually starts when the container is discharged or made available. For per diem, the line's free days usually start when the container leaves the terminal or ramp.

Three things commonly change the date:

• Holds. A customs examination, a line hold or a terminal hold can keep a box unavailable. Whether held days count against free time depends on the tariff, so read it, and keep proof of the hold.
• Weekends and holidays. Some tariffs count calendar days and some count working days. A charge built on the wrong basis is one of the easiest errors to dispute.
• Closures. If a terminal or depot was closed or refusing empties on a day it counted against you, you have grounds to ask for that day back.

Our guide to container drayage in Canada explains the releases that must line up before pickup, and the CBSA release guide covers customs holds and in-bond moves.

Where the terms come from in Canada

In the United States, a Federal Maritime Commission rule sets out what a demurrage or detention invoice must contain, such as the bill of lading number, the container number and the basis for billing that party. We did not find a Canadian counterpart. In Canada, storage and per diem terms come from three places:

1. Terminal tariffs and terms of service, published by each terminal operator.
2. Railway tariffs, published by CN and CPKC for their intermodal terminals and services, plus any confidential contract a customer has with the railway.
3. Shipping-line tariffs and contracts, including bill of lading terms and service contracts.

Railway charges are the one area where federal law gives a direct route. Section 120.1 of the Canada Transportation Act lets a shipper who is subject to charges and associated terms for the movement of traffic, or for incidental services, in a tariff that applies to more than one shipper, complain in writing to the Canadian Transportation Agency. If the Agency finds the charges or terms unreasonable, it may set new ones by order, for up to one year. The Agency must consider the objective of the charges, industry practice, and for incidental services, whether there is an effective, adequate and competitive alternative. The section does not apply to rates for the movement of traffic itself.

The Act defines a shipper as a person who sends or receives goods by means of a carrier or intends to do so. Whether a drayage company is a shipper for a given charge depends on its role in that move, so take advice before relying on the section.

There is also a backstop for unreleased cargo. Under the Customs Sufferance Warehouses Regulations, goods not removed from a sufferance warehouse within 40 days after they were reported may be moved to a place of safe-keeping. A container waiting on customs release does not sit indefinitely.

In Vancouver, one more rule touches waiting time rather than storage. The BC Container Trucking Regulation makes paying wait time remuneration to truckers, for delays inside a marine terminal, a condition of every Container Trucking Services licence. See our Port of Vancouver container trucking guide.

How charges reach the drayage carrier

Terminals and lines rarely invoice the trucker directly for storage or per diem. The charge usually lands on the importer, its forwarder or the line, and then moves down the chain. It reaches the drayage carrier in two ways:

• As a pass-through. You pay the charge to get the container out, or to return it, and bill it to your customer as an accessorial. Agree in advance that you can, and what proof the customer wants.
• As a chargeback. Your customer deducts a charge from your invoice because it says your delay caused it. Whether it can do so depends on your rate confirmation or contract.

The single best protection is a written rule, agreed before the move, on who bears storage and per diem in each situation: late release, no appointment available, customer not ready, carrier late.

How to dispute a storage or per diem charge

1. Ask for the detail. Request the invoice with the container number, the free time applied, the start and end dates, and the tariff or contract provision relied on.
2. Check the basis. Compare the dates and the calendar-day or working-day basis with the published tariff or your contract.
3. Match it to your records. Line up gate times, appointment attempts, release timestamps and equipment interchange receipts against the billed days.
4. Identify days that should not count. Holds, closures, refused returns and missing appointment capacity are the usual candidates.
5. Dispute in writing, on time. The deadline is in the biller's terms, not in a Canadian statute, so find it early.
6. Escalate when the terms allow. For railway tariff charges that apply to more than one shipper, a complaint under section 120.1 is available to a shipper.

Records to keep on every container

• Release confirmations from the customs broker and the line, with times.
• Appointment bookings and screenshots of unavailable slots.
• Gate-in and gate-out receipts and equipment interchange receipts.
• The line's notice of the empty return location, and any change to it.
• Photos and notes for refused returns, closed depots and damaged equipment.

If you also run US moves, the US version of this guide on truckerpro.net covers the FMC rule in detail.

How TruckerPro tracks drayage charges

TruckerPro's Intermodal & Drayage workspace, available on the Elite plan and up once switched on in company Settings, records pickup and empty-return last free days and flags them as due or overdue in the terminal's time zone. Charges can be set up as terminal or rail storage, container detention or per diem, chassis rental, yard storage, pre-pull, chassis split, dry run, empty return, waiting time, overweight, reefer and other services, each on a fixed, calendar-day or weekday basis with free days and excluded dates. Every charge carries a customer rate and a supplier cost, overlapping daily charges are refused, and a draft charge can be posted to the load as an invoice accessorial before invoicing, or waived. A supplier charge can be linked to a payables bill and tracked through a dispute (open, submitted, resolved) with a deadline and an evidence note, in CAD or USD to match the load. TruckerPro has no live terminal, port, rail or shipping-line feeds, so your team enters the dates and confirms each release.

Frequently asked questions

What is the difference between storage and per diem on a container?

Storage, often called demurrage, is charged by the place holding the container, such as a marine terminal or a rail ramp, once its free time ends. Per diem, often called detention, is charged by the shipping line that owns or controls the container for keeping its equipment out past the line's free days. They run on separate clocks and are billed by different parties.

Does Canada have a rule like the US FMC demurrage billing rule?

We did not find a Canadian counterpart to the US Federal Maritime Commission's demurrage and detention billing rule. In Canada the terms come from terminal tariffs, railway tariffs, and the shipping line's tariffs and contracts. For railway charges in a tariff that applies to more than one shipper, section 120.1 of the Canada Transportation Act lets a shipper complain to the Canadian Transportation Agency.

Who pays storage when the drayage carrier is late?

That depends on the drayage contract or rate confirmation. Terminals and lines usually bill the party they deal with, often the importer, its forwarder or the line, and the charge can then be passed down. If the delay was the carrier's fault and the contract says so, the carrier may end up paying. Agree the rule in writing before the move.

What records help win a demurrage or per diem dispute?

Time-stamped proof of when the container became available and released, when you booked or tried to book an appointment, gate-in and gate-out receipts, equipment interchange receipts, notices that the terminal or return depot was closed or refusing returns, and the line's notice of the return location.

Sources

• Canada Transportation Act, S.C. 1996, c. 10, sections 6 and 120.1 (Justice Laws)
• Customs Sufferance Warehouses Regulations, SOR/86-1065, section 15 (Justice Laws)
• Container Trucking Regulation, B.C. Reg. 248/2014, sections 1 and 23 (BC Laws)
• CN: Optional services, rules and regulations, tariffs
• 46 CFR 541.6, Contents of demurrage and detention invoices (eCFR), for the US comparison