What importers and freight forwarders need to know about the control of terms and conditions of carriage.
A demurrage claim by the shipping company is not valid simply because it is based on the terms and conditions of carriage. These terms and conditions are standard business terms and conditions and, insofar as German law applies, are subject to the review of standard business terms and conditions pursuant to Sections 305 et seq. of the German Civil Code (BGB). Rogert & Ulbrich examines whether the underlying clause is valid at all – and enforces your objections.
The basis for the shipping company's demurrage claim
Demurrage does not arise from law, but from the shipping company's terms and conditions of carriage and tariffs. These conditions are pre-formulated for a multitude of contracts and are therefore standard business terms and conditions within the meaning of Section 305 of the German Civil Code (BGB). The law governing standard business terms and conditions also applies in commercial transactions – modified by Section 310 Paragraph 1 of the BGB, which makes some clause prohibitions not directly applicable, but leaves the central content control under Section 307 of the BGB unaffected.
For importers and freight forwarders, this means: the claim stands or falls with the clause. Those who accept the conditions without review may be paying on a basis that is not legally valid. You can read more about this topic in our guide to demurrage and detention in container transport.
Received a demurrage charge demand? First, request the exact tariff and clause wording that the shipping company is citing.
Incorporation control: Did the terms and conditions actually become part of the contract?
Before considering the content of a clause, it must be clarified whether the terms and conditions of carriage were effectively incorporated at all. In commercial transactions, it is generally sufficient that the other party to the contract could reasonably expect the terms and conditions to apply and had the opportunity to become aware of them – for example, through a reference on the bill of lading or the shipping company's tariff page. If this is lacking, the terms and conditions have not become part of the contract.
Furthermore, Section 305c of the German Civil Code (BGB) applies: Surprising and ambiguous clauses are interpreted against the user. A demurrage clause found in an unexpected location or in an inaccessible form may fail this requirement. In international container transport, the question of the language and version of the terms and conditions is also not a mere formality.
Unsure whether the conditions even apply? Have the inclusion checked before negotiating the amount.
Fee or lump sum for damages – why the classification determines the control
The crucial point often lies in a preliminary question: Is demurrage a fee for the continued use of the container or a lump-sum compensation for the delayed handling? According to Section 307 Paragraph 3 Sentence 1 of the German Civil Code (BGB), purely price-related agreements are exempt from content control. Shipping companies therefore frequently argue that demurrage is a usage fee exempt from review.
It can be argued, however, that demurrage primarily exerts economic pressure for a quick return and is intended to compensate for a standardized type of damage. If the clause is classified as liquidated damages, it is fully subject to review. This classification is controversial and depends on the specific wording of the clause; the relevant case law must be editorially reviewed before publication.
Editorial note: Verify the current state of the Federal Court of Justice (BGH) and lower court rulings on the classification of demurrage as remuneration or lump-sum damages before publication.
Received a high demurrage charge? Whether the clause is legally enforceable determines your chances of success – have the classification reviewed.
Content control according to § 307 BGB – when the clause is unreasonably disadvantageous
If the clause is subject to review, the decisive factor is whether it constitutes an unreasonable disadvantage under Section 307 of the German Civil Code (BGB). Even though the prohibitions on clauses in Sections 308 and 309 of the BGB do not apply directly in B2B transactions, they have an indicative effect via Section 310 Paragraph 1 Sentence 2 of the BGB. Section 309 No. 5 of the BGB, concerning liquidated damages, is particularly relevant. Typical points of contention include:
- Flat fee above the typical damage: If the daily rates significantly exceed the damage that would normally be expected, this indicates an unreasonable disadvantage.
- No counter-evidence is possible: If the clause excludes proof of lesser or no damage, this is a strong indication of its invalidity.
- Non-transparent pricing structure: If the logic of the increasing daily rates is not clearly comprehensible, the clause may fail to meet the transparency requirement of Section 307 Paragraph 1 Sentence 2 of the German Civil Code (BGB).
- No connection to the cause: If the clause disregards delays for which the recipient is not responsible, it unilaterally shifts the risk.
It is important to note that partial invalidity can affect the entire clause, because standard terms and conditions cannot be reduced to the bare minimum permissible content. An excessive flat fee, therefore, does not automatically fall back to a reasonable level, but may be rendered completely invalid. Do not sign any payment agreement until this point has been clarified.
A demand for demurrage for several weeks? Have the daily rates reviewed to ensure they comply with a content control assessment.
Applicable law and jurisdiction – the preliminary question that decides everything
German general terms and conditions (GTC) review only applies if German law is applicable to the contract. However, many transport terms and conditions contain a choice of law in favor of a foreign legal system as well as a jurisdiction clause. Which law applies depends on the Rome I Regulation and the specific agreement. This preliminary question is therefore often the first and most important step in any defense.
If foreign law applies, Sections 305 et seq. of the German Civil Code (BGB) cannot be applied directly – the examination then shifts to the foreign legal system. At the same time, choice-of-law and jurisdiction clauses must themselves be examined for validity. Through our Dutch Desk, we also cover the interface with Dutch law, which regularly plays a role in transactions via Rotterdam and Antwerp.
Do the terms and conditions refer to foreign law? First, clarify which legal system applies before arguing the content.
How to check a demurrage claim for invalidity
A structured approach can often significantly reduce or completely prevent a demurrage charge claim. The following steps outline the review process:
- Obtain clause and tariff version: Request the exact wording of the terms on which the claim is based.
- Check for inclusion: Clarify whether the conditions have actually become an effective part of the contract.
- Make a classification: Assess whether the clause should be classified as a fee that is not subject to control or as a lump-sum damages payment that is subject to control.
- Clarify applicable law: Check the choice of law and jurisdiction before relying on German general terms and conditions control.
- Question the extent of the damage: Demand proof of the actual damage and check whether a lesser amount of damage can be demonstrated.
- Meet deadlines: Raise your objections promptly and with sufficient evidence to avoid the statute of limitations and preclusion.
In many cases, a significant reduction is achieved out of court because the shipping company cannot fully substantiate its flat fee. If an agreement cannot be reached, legal action will be taken to defend against or enforce the claim. The sooner the strategy is in place, the stronger your position will be.
The longer the claim remains unchallenged, the more difficult the defense becomes. Have the clause reviewed now.
Rogert & Ulbrich – Your lawyers in transport and forwarding law
Rogert & Ulbrich advises importers, freight forwarders, and logistics companies on defending against and reviewing demurrage and detention claims. Attorneys Dr. Marco Rogert and Tobias Ulbrich and their multilingual team have extensive practical experience with the terms and conditions of carriage of major shipping companies and the relevant review of standard terms and conditions.
We examine the inclusion, classification, and effectiveness of the clause, clarify the applicable law, and enforce your objections – both out of court with the shipping company and freight forwarder, as well as in court. Through our Dutch Desk, we also consider Dutch law for traffic via Rotterdam and Antwerp.
Whether it's a five-figure demurrage bill or a disputed choice-of-law clause: Get in touch and secure your claims.
