2140-0021 -- Supporting Statement - 2023 Demurrage -- (to ROCIS)

2140-0021
December 2023
Expires 12/31/23
SUPPORTING STATEMENT
FOR REQUEST OF OMB APPROVAL
UNDER THE PAPERWORK REDUCTION ACT AND 5 C.F.R. § 1320
The Surface Transportation Board (STB or Board) requests an extension of approval of
the information collection for the Demurrage Liability Disclosure Requirements.
A. Justification.
1. Why the collection is necessary. Demurrage is a charge by a rail carrier that both
compensates it for the expense incurred when its rail cars are detained beyond a specified period
of time (i.e., “free time”) for loading and unloading and serves as a penalty for undue car
detention to encourage the efficient use of rail cars in the rail network. See 49 C.F.R. § 1333.1.
Demurrage is subject to Board regulation under 49 U.S.C. § 10702 (requiring railroads to
establish reasonable rates and transportation-related rules and practices) and 49 U.S.C. § 10746
(requiring railroads to compute demurrage charges and related rules in a way that will fulfill
national needs related to freight car use and distribution and maintenance of an adequate car
supply).
In the simplest demurrage case, a railroad assesses demurrage on the consignor (the
shipper of the goods) for delays in loading cars at origin and on the consignee (the receiver of the
goods) for delays in unloading cars and returning them to the rail carrier at destination.
Demurrage can also, however, involve warehousemen that accept freight cars for loading and
unloading but have no property interest in the freight being transported. Warehousemen are not
typically owners of property being shipped (even though, by accepting the cars, they could be in
a position to facilitate or impede car supply), but rail carriers sometimes bill them for demurrage
as well. Thus, with multiple participants, it is important to provide clarity and notice for all
parties involved.
2. Use of Data Collected. While disputes between railroads and parties that originate or
terminate rail cars can involve relatively straightforward application of the carrier’s tariffs to the
circumstances of the case, complications can arise in cases involving warehousemen or other
“third-party intermediaries” who handle the goods but have no property interest in them. In
recent years, it has been more important to determine what party should bear liability when an
intermediary accepts rail cars and detains them too long, especially when the party named as
consignee in the bill of lading asserts either that it did not know of its consignee status or that it
affirmatively asked the shipper not to name it consignee. Thus, a demurrage liability disclosure
requirement is used to ensure that parties to rail transactions provide and/or receive notice
regarding any potential liability for demurrage charges. Additionally, for the same purpose, this
collection requires Class I carriers to directly bill the shipper for demurrage when the shipper and
warehousemen agree to that arrangement and so notify the rail carrier.

3. Extent of automated information collection. Carriers may use electronic means to
satisfy the proposed notice requirement. A carrier may email an affected party the tariff itself or a
link to the tariff that is posted on the carrier’s website.
4. Identification of duplication. The information requested does not duplicate any other
information available to the Board or the public. No other federal agency has authority to
adjudicate these complaints, and no other agency collects this information.
5. Effects on small business. The burden of providing notice is minimal. Moreover,
providing the required notice will help small businesses avoid costly litigation regarding demurrage
disputes. Notice is only required once per shipper, and not again unless the railroad chooses to
materially change the terms of its tariff.
6. Impact of less frequent collections. The notice requirement is triggered when a
shipper initially arranges with a rail carrier for transportation of goods pursuant to the railroad’s
tariff, or when a rail carrier materially changes the terms of its demurrage tariff. Class I rail
carriers are also required to bill shippers more often, but, if there was less frequent notice or no
notice at all, it would expose the parties to possible litigation regarding demurrage liability in the
instances when such notice has not been provided.
7. Special circumstances. No special circumstances apply to this collection.
8. Compliance with 5 C.F.R. § 1320.8. The Board published a 60-day notice requesting
comments on this collection at 88 Fed. Reg. 65419 (Sept. 22, 2023). No comments were
received. A 30-day notice was published concurrently with this submission to Office of
Management and Budget (OMB). 88 Fed. Reg. 88209 (December 20, 2023).
9. Payments or gifts to respondents. The Board does not provide any payment or gift to
respondents.
10. Assurance of confidentiality. No confidential information is involved in this
collection.
11. Justification for collection of sensitive information. No sensitive information is
requested.
12. Estimation of burden hours for respondents.
(1) Number of respondents: 620 (including six Class I railroads)
(2) Frequency of response: On occasion. The existing demurrage liability disclosure
requirement is triggered in two circumstances: (1) when a shipper initially
arranges with a railroad for transportation of freight pursuant to the rail carrier’s
tariff; or (2) when a rail carrier changes the terms of its demurrage tariff.
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(3) Annual hour burden for all respondents: 1,330.7 hours. Consistent with the
existing, approved information collection, Board staff estimates that: (1) six
Class I carriers would each take on 18 new customers each year (108 hours);
(2) each of the six Class I carriers would update its demurrage tariffs annually
(6 hours); (3) 620 non-Class I carriers (which are already subject to the existing
collection requirements, but which will not be subject to the new requirements)
would each take on one new customer a year (620 hours); and (4) each of the nonClass I carriers would update its demurrage tariffs every three years (206.7 hours
annualized). For the requirement that Class I carriers must directly bill the
shipper for demurrage when the shipper and warehouseman agree to the
arrangement and so notify the rail carrier, Board staff estimates that annually six
Class I carriers would each receive 65 direct-billing agreements per year at one
hour per agreement (390 hours). The total hourly burdens are also set forth in the
table below.
Table – Total Burden Hours (per year)
Respondents

New
Customer
Burden

Tariff
Update
Burden

Burden for
Invoicing
Agreement

Total
Annual
Burden
Hours

6 Class I
Carriers

108 hours

6 hours

390 hours

504 hours

620 NonClass I
Carriers

620 hours

206.7 hours

---

826.7 hours

Totals

728 hours

212.7 hours

390 hours

1,330.7 hours

13. Other costs to respondents. No non-labor costs are anticipated as the notice is likely
to be delivered electronically.
14. Estimated costs to the federal government. This collection is a requirement that
Class I carriers invoice demurrage involving a warehouseman to the shipper if the shipper and
warehouseman have agreed to that arrangement and have so notified the rail carrier. Because the
Board will not collect any information, there will be no cost to the Board.
15. Explanation of Program Changes or Adjustments. The estimates in this information
collection reflect the agency’s updated estimates for the number of carriers, notifications and
billings.
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16. Plans for tabulation and publication. Because the agency will not be collecting this
information, there are no plans for the agency to publish the information.
17. Display of expiration date for OMB approval. The new expiration date for this
collection will be published in the Federal Register when the collection is approved by OMB.
18. Exceptions to Certification Statement. Not applicable.

B. Collections of Information Employing Statistical Methods.
Not applicable.

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