EFFICIENCY IN CONTAINTER ALLOCATION IN THE US AND EU: AN INSTITUTIONAL PERSPECTIVE

Demurrage and Detention charges are facing considerable scrutiny across the world. Even so, in the United States ("US"), where the Federal Maritime Commission ("FMC") finished a year-long study and determined to allow market solutions rather than governmental dictates, the proble...

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Bibliographic Details
Published in:Journal of transportation law, logistics, and policy logistics, and policy, 2019-01, Vol.86 (1), p.88-100
Main Authors: Stapleton, Drew, Nandialath, Anup Menon
Format: Article
Language:English
Subjects:
Competition
Efficiency
Fees & charges
Ports
Supply chains
Tariffs
Transportation services
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Summary:Demurrage and Detention charges are facing considerable scrutiny across the world. Even so, in the United States ("US"), where the Federal Maritime Commission ("FMC") finished a year-long study and determined to allow market solutions rather than governmental dictates, the problem persists. On the contrary, the situation in the European Union ("EU") is the opposite; in the EU, there is much more efficiency in container allocations and thereby lower demurrage and detention charges in general. In this paper, we use the concept of institutional distance and suggest that, perhaps, a market-based solution is not necessarily optimal. There might be a case for regulation to reduce the demurrage and detention issues which are currently prevalent in the US market.
ISSN:1078-5906