Additional Costs Due to Force Majeure — Forwarder Quotations and Shipper Cost Responsibility
Interlink編集部What Are Force Majeure and Additional Costs?
Force majeure and additional costs refer to expenses that arise due to circumstances beyond the control of the shipper or freight forwarder, such as natural disasters, war, civil unrest, strikes, port closures, infectious diseases, administrative regulations, or suspension of operations by shipping lines, which were not included in the original quotation.
In international transportation, quotations are prepared on the assumption that vessels operate as scheduled, ports are functioning, and customs clearance and delivery proceed smoothly. However, when force majeure-like events occur, changes to routing, storage, re-arrangements, delivery delays, additional delivery, Demurrage, Detention, and other charges may arise.
An important practical point regarding force majeure is that “whether someone is at fault” and “who ultimately bears the costs actually incurred” are separate issues. Even if the freight forwarder is not responsible for the force majeure event itself, arrangements are needed on how to handle actual costs incurred from ports, warehouses, shipping lines, CFS, or delivery companies.
In other words, force majeure may serve to limit liability for damages or delayed delivery, but it does not automatically exempt any third-party costs such as storage, waiting time, re-dispatch costs, alternative transport, or document reissuance from being charged.
Scope of This Article
This article organizes the additional costs arising from force majeure events from the perspectives of cargo owners, freight forwarders, shipping lines, CFS, warehouses, delivery companies, and marine cargo insurance.
The focus of this article is to separate the issue of responsibility—“no one is at fault because it was force majeure”—from the issue of cost settlement—“who actually bears the costs incurred.”
| Item | Contents Covered in This Article | Contents Covered in Other Articles in Detail |
|---|---|---|
| Basics of Force Majeure | Structures in which additional costs arise due to natural disasters, wars, strikes, port closures, administrative regulations, etc. | Legal interpretation of force majeure clauses in individual contracts is covered in articles related to contracts and terms and conditions. |
| Types of Additional Costs | Storage fees, Demurrage, Detention, re-dispatch costs, alternative transport costs, and shipping line surcharges. | Details of Demurrage, Detention, and storage are covered in specialized articles. |
| Concept of Cost Allocation | Reasons why third-party actual costs may occur even under force majeure, and the allocation between cargo owner and freight forwarder. | Specific invoice processing and individual negotiations are handled in articles on billing practice. |
| Quotation Terms and Clauses | How to describe separate actual cost billing, non-guaranteed delivery dates, force majeure exemptions, and approval for additional costs. | Wordings in quotations, standard trading conditions, and B/L clauses are detailed in specialized articles. |
| Relation to Trade Terms | Overview of who arranges transportation and who tends to bear additional costs under FOB, CFR, CIF, DAP, DDP, etc. | Details on Incoterms and cost allocation are covered in articles related to Incoterms. |
| Relation to Marine Cargo Insurance | Overview of ICC (A)/(B)/(C), War Clauses, Strikes Clauses, delay damages, and additional cost handling. | Marine cargo insurance, war risks, and strike risks are discussed in insurance-focused articles. |
| Freight Forwarder’s Scope of Response | Provision of information, presentation of alternatives, explanation of expected costs, and record-keeping of approvals. | Claim letters at the time of accidents, insurance notifications, and liability limitations are covered in specialized articles. |
| Practical Cases | Cases involving typhoons, port strikes, wars/conflicts, administrative regulations, vessel omissions by shipping lines, system failures, etc. | Legal regulations, port advisories, and shipping line terms for each individual cause are checked through official information or specific cases. |
Why Additional Costs Arise Even Under Force Majeure
The issue with force majeure arises because, although no one has made an intentional mistake, costs still in practice occur.
Even when a port is closed, a vessel skips calling, CFS operations stop due to a strike, or roads become unusable due to a disaster, cargo must be stored somewhere and rescheduled for further handling.
Ports, CFS facilities, warehouses, transportation companies, and shipping lines maintain personnel, equipment, yards, containers, trucks, systems, and security even in force majeure situations. When cargo remains, storage space is occupied; delayed container returns extend container usage periods; and trucks waiting cause vehicles and drivers to be tied up.
Therefore, although the freight forwarder may not be liable for the force majeure event itself, actual expenses incurred by third parties providing storage, waiting, re-dispatch, alternative transportation, document processing, and the like will arise. Who bears these actual costs is determined comprehensively by combining the quotation terms, contract clauses, shipper approval, cause of occurrence, and the forwarder's explanation status.
Force Majeure Does Not Eliminate Costs
In practice, a common misunderstanding is the idea that "because it is force majeure, no one has to pay any costs."
Force majeure may exempt or limit liability for damages or delays in performance. However, when warehouses, shipping lines, ports, CFS, or delivery companies have actually provided services and incurred storage or rebooking fees, those costs do not simply disappear.
For example, if a typhoon closes a port and cargo remains in a CFS for several days, the freight forwarder did not cause the typhoon. Nevertheless, CFS storage fees are incurred in reality. Determining who bears these costs depends on the quotation terms, separate actual cost clauses, the cause of occurrence, and whether the shipper was notified and approved the charges.
Common Causes Classified as Force Majeure
The following are typical causes that often become issues of force majeure in international transportation. These are treated as circumstances that differ from ordinary transport risks, and it may be difficult for the parties involved to fully predict or avoid them.
| Cause | Main Impact | Likely Additional Costs | Practical Notes |
|---|---|---|---|
| Typhoons, earthquakes, tsunamis, heavy snow, floods | Port operations, road transport, warehouse receiving, and delivery are suspended. | CFS storage fees, CY storage, re-dispatch costs, standby fees | Confirm port closure updates and expected resumption dates for gate-out. |
| War, civil unrest, terrorism, piracy | Route changes, call port changes, transshipment changes, and insurance condition revisions occur. | War risk surcharge, additional fuel costs, alternative transport expenses, arrival delay costs | Check War Clauses, Strikes Clauses, and delay exemptions. |
| Port closure | Loading/unloading at vessel, CFS gate-out, and CY gate-out halt. | Storage charges, Demurrage, Detention, gate-out reservation change fees | Verify free time extension availability and shipping line/port notices. |
| Port strike | Impacts cargo handling, CFS operations, gate-out, and delivery schedules. | Storage fees, re-dispatch costs, standby fees, delivery reservation change fees | Record timing of strike information acquisition and shipper notification. |
| Infectious disease outbreak | Difficulties securing personnel at ports, warehouses, customs, and delivery. | Storage fees, inspection costs, additional document fees, delivery delay expenses | Confirm official notices, facility operational status, and alternative measures. |
| Sudden changes in administrative orders or import/export regulations | Customs suspension, additional inspections, permit verification, returns, and rerouting needed. | Inspection fees, storage charges, re-declaration costs, additional document preparation fees | Separately confirm regulation changes themselves and possible omissions in document guidance. |
| Shipping line service suspensions, skipped calls, roll-over | Cargo cannot be loaded on scheduled vessel, arrival plans change, alternate routes become necessary. | Rebooking fees, storage charges, alternative carrier expenses, delivery reservation change fees | Retain records of shipping line notices and alternative proposals presented to shippers. |
| Large-scale system failures | Delays in customs, gate-out, shipping line documents, and warehouse processing. | Storage charges, re-dispatch costs, document reissue fees, gate-out delay costs | Confirm failure notifications, feasibility of alternative procedures, and restoration time. |
Common Misunderstandings
Force majeure and additional costs often cause discrepancies in understanding between the cargo owner and the freight forwarder. The following common misunderstandings can lead to disputes over additional charges and responsibility boundaries.
| Common Misunderstanding | Actual Perspective | Practical Points to Note |
|---|---|---|
| If it is force majeure, no one bears any costs. | Even in cases of force majeure, actual expenses such as storage fees, rebooking charges, and additional shipping line costs may occur. | Check the quotation terms, separate actual costs, applicable clauses, and approval for additional arrangements. |
| If it is force majeure, the freight forwarder does not need to do anything. | Although there is no direct liability for force majeure itself, information sharing, status confirmation, proposing alternatives, and explaining additional costs are required. | Keep records of communications, alternative proposals, and timing of reports to the cargo owner. |
| Strike or war risks are fully covered by insurance. | It is necessary to confirm whether war or strike risks are included in the standard cargo insurance terms or require special clauses. | Verify ICC (A)/(B)/(C), War Clauses, Strikes Clauses, and delay exemptions. |
| The freight forwarder compensates for sales losses caused by vessel delays. | Schedules are generally planned dates, and delivery guarantees usually do not apply without specific agreements. | Confirm whether delivery guarantees apply, delay exemptions, and expression used in quotations. |
| The freight forwarder bears the cost difference because an alternative route was used. | If the alternative route was arranged based on the cargo owner’s request or approval, additional costs may be borne by the cargo owner. | Record proposals of alternatives, estimated costs, and cargo owner approval. |
| Writing "force majeure" means any additional costs can be claimed automatically. | It is essential to link the cause of costs, nature as actual expenses, advance notice to the cargo owner, approval, and consistency with quotation terms. | Organize billing details, reasons for cost occurrence, and approval records. |
| Costs billed by ports or shipping lines are always borne by the cargo owner. | Even with actual cost claims, delayed communication or errors by the freight forwarder may constitute distinct issues. | Separate confirmation of force majeure causes and appropriateness of freight forwarder responses is required. |
| If the cargo damage is paid by insurance, additional costs are naturally covered too. | Damage to the cargo itself and fees such as storage, rebooking, or alternative transport costs are evaluated separately. | Confirm whether insurance terms cover cost-related damages and delay damages. |
Additional Costs and Responsible Parties by Cause
Additional costs arising from force majeure vary depending on the cause. In practice, it is important to identify what happened, which process was affected, and who approved the additional arrangements.
| Force Majeure Cause | Typical Additional Costs | Responsibility Considerations | Supporting Documents |
|---|---|---|---|
| Typhoon, Earthquake, Heavy Snow, Flood | CFS storage fees, CY storage, Demurrage, Detention, re-dispatch costs, waiting charges | Disasters themselves are often not the freight forwarder's responsibility; however, actual costs may be charged to the cargo owner based on the quotation terms. | Port closure information, delivery records, storage fee details, quotation terms |
| Port Strike | Storage fees, gate-out delay fees, re-dispatch costs, waiting charges, schedule change fees | Strikes are frequently outside the freight forwarder's control. Approval for alternative arrangements and additional deliveries after strike resolution is important. | Port notices, CFS announcements, delivery company invoices, cargo owner approval emails |
| War, Conflict, Piracy Risk | Route change costs, additional fuel charges, war risk surcharge, transshipment change fees, storage fees due to arrival delays | Surcharges from the shipping line or Actual Carrier are often settled on an actual cost basis. Cargo owner approval is important for urgent alternative transportation. | Shipping line notices, surcharge announcements, alternative route quotations, approval records |
| Administrative Regulations / Changes in Export-Import Controls | Inspection fees, storage fees, additional document preparation costs, re-declaration fees, return or redirection costs | Administrative decisions themselves are usually not the freight forwarder's responsibility; however, delays or failures in document submission should be separately reviewed. | Government notifications, inspection notices, customs records, document submission history |
| Shipping Line Operational Suspension / Port Omission / Roll-over | Rebooking fees, storage fees, schedule change fees, delivery reservation change fees | Changes due to shipping line circumstances are often beyond the freight forwarder's control; communication with the cargo owner and presenting alternatives is essential. | Booking confirmations, shipping line notices, schedule history, communication logs |
| Major System Failure | Customs delay fees, gate-out delay fees, storage fees, re-dispatch costs, document reissue fees | Review the cause and scope of the system failure and whether alternative procedures could have been implemented. | Failure notifications, customs records, gate-out records, re-dispatch records |
| Infectious Disease Outbreak / Facility Closure | Storage fees, re-dispatch costs, delivery delay fees, additional inspection fees, local agent fees | Public measures or facility closures are often outside control; presenting alternatives and obtaining cargo owner approval is important. | Public announcements, facility notices, local agent reports, cargo owner approval records |
This table does not mechanically assign responsibility. In practice, judgments are made based on quotation terms, contract clauses, cause of occurrence, cargo owner approval, and the freight forwarder's response status.
Summary of Additional Costs by Trade Terms
Additional costs arising from force majeure vary depending on who arranges the transportation, who arranges the cargo insurance, and at which stage the cost occurs. Trade terms such as FOB, CFR, CIF, DAP, and DDP are important for organizing the expense responsibilities between the seller and buyer.
| Trade Terms / Arrangement | Main Party Responsible for Transportation Arrangement | Common Issues with Additional Costs | Practical Confirmation |
|---|---|---|---|
| FOB Import | The buyer side often arranges the ocean transportation. | Delays of the vessel, port closures, import-side delivery charges, and storage fees often become issues for the buyer side. | Confirm the importer, buyer-side freight forwarder, and cargo insurance terms. |
| CFR Import | The seller side often arranges the ocean transportation, while the buyer side arranges the insurance. | Changes in shipping line, delays, and additional import-side costs may be difficult for the buyer to grasp. | Check seller-side arrangement details, shipping line notifications, and whether buyer-side insurance is in place. |
| CIF Import | The seller side often arranges both the ocean transportation and cargo insurance. | Even if insurance is arranged by the seller, import-side storage fees and additional delivery costs can separately become problematic. | Separate the insurance policy, import-side expenses, and costs not covered by insurance. |
| DAP Import | The seller side often arranges transportation up to the designated place. | Delays and additional delivery costs up to the delivery location are frequent points of dispute between seller and buyer. | Confirm the designated place, delivery conditions, delivery appointments, and cost burden in case of delays. |
| DDP Import | The seller side typically arranges customs clearance and delivery broadly. | Administrative regulations, customs stoppages, additional inspection fees, and storage fees tend to occur. | Confirm importer name, customs documentation, applicability of regulations, and responsibility for additional costs. |
| Freight Forwarder Full Arrangement | The freight forwarder manages ocean, customs clearance, and delivery comprehensively. | Customers often misunderstand that "all costs are included." | Clearly specify the quotation scope, separate actual costs, force majeure expenses, and that delivery dates are not guaranteed. |
Common Additional Costs
When force majeure occurs, the following additional costs often become an issue. These costs are frequently not included in the original estimate and may be handled as separate actual expenses if they arise.
| Additional Cost | Common Situations | Billing Party | Points to Confirm |
|---|---|---|---|
| Storage Fees at Port, CFS, or Warehouse | Port closure, customs suspension, CFS gate-out halt, delivery delay | Port, CFS, warehouse, local agent | Storage start date, free period, storage fee rates, cause of occurrence |
| Demurrage | Failure to gate out import containers within free time | Shipping line, terminal | Free time, date incurred, negotiability of waiver, shipping line notice |
| Detention | Late return of containers | Shipping line, container owner | Return deadline, reason for delay, delivery records, return records |
| Re-dispatch Costs / Waiting Charges | Strike, port closure, road blockade, CFS operation stoppage | Delivery company, trucking company | Arrangement time, cancellation possibility, waiting time, shipper approval |
| Alternate Port / Route Costs | Port omission, route changes, port closure, war/conflict | Shipping line, airline, local agent, delivery company | Alternative proposals, cost estimates, expected delivery date, shipper approval |
| Shipping Line / Airline Surcharges | War risk, increased fuel costs, congestion, emergency rerouting | Shipping line, airline | Surcharge notice, applicable period, basis for application, quotation terms |
| Document Correction / Re-issuance Fees | Changes in regulatory requirements, re-declaration, change of delivery location, transport route alteration | Shipping line, customs broker, local agent | Reason for correction, requester, required documents, cause of occurrence |
Additional Costs Due to Natural Disasters
Typhoons, heavy snowfall, earthquakes, and floods can halt port cargo handling, road transportation, warehouse intake, and delivery site operations. Not only can the vessel be delayed, but there are also cases where cargo cannot be discharged after arriving at the port.
In such cases, charges such as CFS storage fees, CY Demurrage, Detention from delayed container returns, and re-dispatch costs may arise.
Although no party is responsible for the disaster itself, the costs for storing cargo and arranging alternative transportation will actually be incurred. The freight forwarder needs to confirm which processes are halted, from when the costs begin to accrue, and whether alternative arrangements are possible, then promptly explain these matters to the shipper.
Additional Costs Due to Port Strikes
When a port strike occurs, loading and unloading operations on the vessel, CFS operations, CY gate-out, and post-clearance gate-out may be suspended. Even if the cargo has arrived, if port operations are halted, neither the shipper nor the freight forwarder can arrange for the cargo to be moved out.
If cargo remains at the port or CFS during the strike period, storage fees and container-related charges become an issue. Additionally, after the strike ends, cargo tends to concentrate, causing congestion in gate-out reservations and delivery arrangements, which may result in additional waiting charges and re-dispatch costs.
A freight forwarder cannot prevent the strike itself. However, it is important to provide information to the shipper, confirm the possible timing for gate-out, explain the prospects for additional costs, and consider alternative solutions.
Additional Costs Due to War, Conflict, and Route Changes
Shipping lines may alter their usual routes due to war, conflicts, piracy risks, or route blockades. In such cases, detours, additional fuel costs, war risk surcharges, delays in arrival, and changes in transshipment may occur.
When route changes affect the port of arrival or the estimated arrival time, this can impact inland delivery, customs clearance scheduling, and delivery bookings. Additional route change fees or surcharges not originally estimated may be charged.
For war and conflict risks, it is necessary to check the provisions of the marine cargo insurance for War Clauses, Strikes Clauses, and coverage for delay damages. Not all such risks are automatically covered under standard ICC(A), ICC(B), or ICC(C) clauses; war risks and strike risks typically require confirmation of specific additional coverage conditions.
Additional Costs Due to Administrative Regulations and Customs Suspension
Customs clearance or cargo release may be halted due to administrative orders, changes in import/export regulations, increased inspections, or temporary closures of ports and airports. Regulatory changes or additional inspections on specific items can also have significant impact on import operations.
In such cases, cargo may remain in bonded areas or warehouses, incurring storage fees and inspection costs. Although changes in regulations themselves are not the freight forwarder’s responsibility, it is practically important to explain the situation to the cargo owner, verify required documents, and propose alternative solutions.
However, if the freight forwarder or customs broker delayed submitting documents despite having received them, or overlooked clear regulatory applicability, this may not be considered force majeure but rather an issue of arrangement or verification.
Force Majeure and Freight Forwarder Liability
The freight forwarder is not automatically liable for delays or additional costs caused by force majeure. Even when exercising ordinary care, it is impossible to completely prevent events such as natural disasters, port closures, wars, or strikes.
However, failure to communicate, arrange alternatives, or explain additional costs after a force majeure event occurs creates different issues. While force majeure itself may be considered exempt from liability, inadequate response afterward can affect the trust relationship with the cargo owner and responsibility allocation.
| Situation | Examples Where Freight Forwarder Is Less Likely Liable | Examples Where Freight Forwarder Liability Often Arises | Practical Management Points |
|---|---|---|---|
| Port closure due to typhoon | The port closure itself, and vessel delay itself. | Having known about the closure but failing to inform the cargo owner. | Record port notices, communications with cargo owner, and expected window for gate-out. |
| Work stoppage due to strike | CFS operation stoppage and inability to gate out themselves. | Failing to confirm when gate-out can resume after the strike and making incorrect re-dispatch decisions. | Record strike information, re-dispatch costs, and cargo owner approvals. |
| Route changes due to war or conflict | Shipping line’s route change and additional surcharges themselves. | Proceeding with arrangements without explaining additional costs or expected delays to the cargo owner. | Provide shipping line notices, alternative proposals, and cost estimates. |
| Sudden changes to administrative regulations | The regulatory change itself, and official review periods themselves. | Omissions in guiding required documents, delays in submission, or clear failures to confirm regulations. | Keep records of official notifications, document request dates, and submission histories. |
| Omission or rollover by shipping line | Omission or rollover decisions made by the shipping line themselves. | Knowing the shipping line’s notification but failing to inform the cargo owner or propose alternatives. | Maintain shipping line notices, rebooking proposals, and cargo owner approvals. |
| Major system outage | External system failure itself. | Failing to verify alternative processing possibilities and causing delays in gate-out or customs clearance. | Record outage notifications, whether alternatives are possible, and recovery communications. |
Costs That May Be Charged to the Cargo Owner
Actual expenses arising from force majeure events may be allocated to the cargo owner. For example, if a port closure causes cargo to remain at the CFS, resulting in CFS storage fees, the freight forwarder is not automatically responsible for those costs.
Additionally, if alternative routing, urgent delivery, or arranging another shipping line is conducted at the cargo owner’s request to meet delivery deadlines, the resulting additional costs may be charged to the cargo owner.
It is important to confirm and approve cost estimates before arranging additional services. Even in urgent situations, it is necessary to document that "additional costs will be incurred," provide an "approximate amount," and record whether to proceed with the arrangements.
Decision Flow When Additional Costs Occur
When additional costs arise due to force majeure, organizing the process in the following order makes it easier to understand. Because situations can change rapidly under force majeure, speed is also critical. However, when proceeding with alternative arrangements that will incur costs, prior approval and documentation are extremely important.
| Step | Items to Confirm | Decision Points | Practical Response |
|---|---|---|---|
| 1. Verify Cause | Natural disasters, port closures, strikes, war, administrative regulations, suspension of shipping line operations, etc. | Is the direct cause outside the freight forwarder’s control? | Preserve official notices, shipping line notices, and port announcements. |
| 2. Identify Affected Process | Where in the chain was stopped: vessel operation, cargo handling, CFS operations, customs clearance, CY gate-out, delivery, or final delivery? | At which process stage will costs be incurred? | Clarify the current location of cargo and the point where operations stopped. |
| 3. Confirm Costs | Costs already incurred and forecasted costs. | Classify storage fees, Demurrage, Detention, re-dispatch costs, alternative transport expenses. | Check billing source, unit prices, date incurred, and free time allowances. |
| 4. Review Terms | Quotation conditions, contracts, force majeure clause, separate actual cost billing, delivery guarantee presence. | Is there a basis to additionally charge the shipper? | Review estimates, emails, and standard trading terms. |
| 5. Consider Alternatives | Options such as waiting, alternative route, different shipping line, air transfer, emergency delivery. | Is it necessary to pay additional costs to expedite? | Compare estimated costs, delivery time forecasts, and risks. |
| 6. Shipper Approval | Additional fees, estimated amounts, delivery estimates, and arrangement details. | Will the shipper approve the additional costs? | Keep records of approval via email or chat. |
| 7. Actual Cost Settlement | Details of actual costs incurred, billing source, reason for occurrence. | Do these align with quotation terms and approved contents? | Attach detailed statements and bill by item. |
Points to Clarify in Quotation Terms
To prevent disputes over additional costs caused by force majeure, it is necessary to clarify the following points in the quotation terms.
| Point to Clarify | Reason | Direction of Wording | Risk if Ambiguous |
|---|---|---|---|
| Delays caused by force majeure may be exempt from liability | To avoid unlimited liability for schedule delays. | Provide examples such as natural disasters, war, strikes, port closures. | May be misunderstood as a delivery date guarantee. |
| Actual costs incurred due to force majeure will be charged separately | Because storage fees and rebooking costs from third parties may be incurred. | Clearly state “actual costs charged separately,” “settled upon occurrence,” and “based on detailed invoices.” | May be argued to be included in the original freight charges. |
| Storage fees during port closures, strikes, or disasters will be charged separately | Because CFS, CY, and warehouse costs tend to arise. | Specify storage fees, Demurrage, and Detention fees explicitly. | Basis for claiming storage fees may be weakened. |
| Costs for alternative routes or emergency arrangements will be charged separately | Because cost structures differ from normal routes. | Provide examples such as alternative transport, different shipping lines, air transfer, and urgent delivery. | Approval of costs after alternative arrangements may lead to disputes. |
| Vessel schedules and planned delivery dates are not delivery guarantees | Because they are influenced by shipping lines, ports, customs, and weather. | Clearly state these are estimated dates and not guaranteed dates. | May face claims for delay damages or loss of sales. |
| The coverage under marine cargo insurance and cost responsibility are separate | Because cargo damage and additional costs are treated differently under insurance. | Include a statement that coverage depends on insurance terms and that delay damages may be excluded. | May be misunderstood as full coverage under insurance. |
Example Wording to Include in Quotations
It is important to clearly state the terms regarding force majeure and additional costs in quotations and emails. These wordings are not intended for one-sided exemption of liability due to force majeure. Their purpose is to organize in advance the costs and risks arising under force majeure between the cargo owner and the freight forwarder.
For these terms to function effectively, it is important that the cargo owner can understand the assumptions at the quotation stage, specific examples of additional costs are provided, the basis for actual cost settlement remains, and approval records exist when arranging alternatives.
| Scenario | Example Wording | Purpose of Wording | Practical Notes |
|---|---|---|---|
| Delay Due to Force Majeure | Delays caused by natural disasters, war, strikes, port closures, administrative regulations, suspension of shipping line or airline operations, or other causes beyond our control may be outside our scope of responsibility. | To clarify that delivery deadlines are not guaranteed. | Distinguish between scheduled date and guaranteed date. |
| Actual Costs Due to Force Majeure | Storage charges, Demurrage, Detention, re-dispatch costs, waiting charges, alternative transport costs, and additional claims from shipping lines, ports, or warehouses arising from force majeure or causes beyond our control may be invoiced separately at actual costs when incurred. | To explain third-party actual costs outside the initial quotation. | Retain detailed source of charges for invoicing. |
| Alternative Arrangements | If an alternative route, different shipping line, or urgent delivery is arranged due to vessel delays, port closures, strikes, etc., we will provide a cost estimate in advance and proceed only after your approval. | To obtain approval before incurring additional costs. | Keep approval records via email or chat even in emergencies. |
| Non-Guarantee of Delivery Deadline | The scheduled vessel, flight, or delivery dates may change due to operational status, port conditions, customs clearance, inspection, weather, or other factors. Unless specifically agreed otherwise, no delivery deadline is guaranteed. | To prevent claims for delay damages or lost profits. | Avoid expressions like “must arrive by” during sales explanations. |
| Relation to Insurance | Even if cargo damage occurs due to force majeure, coverage under marine cargo insurance depends on the insurance terms. Please check the insurance conditions regarding delay damages, war risks, strike risks, and other hazards. | To avoid misunderstandings that all damages are covered by cargo insurance. | Confirm ICC (A)/(B)/(C), War Clauses, and Strikes Clauses. |
| Actual Cost Settlement | Additional charges from shipping lines, ports, CFS, warehouse companies, delivery companies, local agents, etc., may be settled at actual cost based on detailed invoices. | To clarify the assumption of passing third-party charges to the cargo owner. | Attach detailed invoices and reasons for costs incurred. |
Relation to Delivery Delays
Force majeure also raises issues related to delivery delays. If the cargo owner has committed to a delivery date with their buyer or factory, delays in delivery caused by port closures or vessel schedule delays require the cargo owner to manage their relationship with the trading partner.
However, freight forwarder quotations usually do not guarantee the delivery date itself. Since vessel schedules and port operations are influenced by external factors, it is important at the quotation stage not to confuse the "planned date" with the "guaranteed date."
For cargo where delivery timing is critically important, it is necessary to confirm not only the usual transportation quotation but also options such as air transshipment, alternative shipping lines, contingency schedules, insurance coverage, and cost allocation in case of delays in advance.
Relationship with Cargo Insurance
When damage occurs to cargo due to force majeure, it is necessary to verify whether this damage is covered by cargo insurance. However, not all damages caused by force majeure are automatically covered.
Cargo insurance generally covers accidental damage to cargo caused by external events. On the other hand, losses due to delay itself, loss of sales opportunities, production line shutdowns, and penalties from delivery destinations are often not covered by standard cargo insurance policies.
Additionally, war risks and strike risks may be included under standard conditions or may require special coverage or endorsements such as War Clauses or Strikes Clauses. Since insurance terms vary in how they handle war, strikes, riots, terrorism, piracy, and similar risks, confirming the coverage conditions is necessary.
| Issue | Points to Check | Notes | Practical Measures |
|---|---|---|---|
| Cargo Damage | Whether physical damage, wet damage, or loss has occurred. | Confirm if the cause of damage is covered. | Gather photos, Survey Report, Invoice, and Packing List. |
| Delay Losses | Whether losses from delayed delivery such as lost sales, penalties, or operational losses are involved. | Usually not covered under standard cargo insurance. | Confirm whether delivery deadlines are guaranteed and check insurance terms. |
| War Risks | Whether war, conflict, capture, mines, or route blockades are involved. | Check for the presence of War Clauses. | Check coverage terms, applicable transit sections, and excluded regions. |
| Strike Risks | Whether strikes, riots, labor disputes, terrorism, etc. are involved. | Confirm if Strikes Clauses are included. | Review insurance policy, endorsements, and covered risks. |
| ICC (A)/(B)/(C) | Extent of cargo damage covered under basic conditions. | Coverage scope varies depending on the terms. | Confirm if war and strike risks are treated separately. |
| Additional Costs | Whether storage fees, rearrangement costs, or substitute transport costs have arisen. | Such costs are not necessarily covered by cargo insurance itself. | Separate cargo damage from cost losses for clarity. |
Issues covered by cargo insurance and those for which the freight forwarder bears costs or responsibility should be organized separately.
Common Practical Issues
In matters of force majeure and additional costs, the main points of dispute tend to be less about the cause itself and more about subsequent explanations, approvals, records, and the presence or absence of detailed cost breakdowns.
| Case | Common Issues | Documents to Check | Practical Measures |
|---|---|---|---|
| CFS gate-out was stopped for several days due to a typhoon | Storage charges at the CFS accrue despite no one's fault. | Port closure information, CFS storage charge details, quotation terms, records of contact with shipper | Separate explanation of the disaster cause and actual cost occurrence. |
| Additional re-dispatch costs occurred due to a port strike | If trucks were already arranged, cancellation fees or re-dispatch costs occur. | Strike notice, dispatch records, cancellation policies, shipper approval | Record the timing of awareness and notification. |
| Shipping line changed the route due to conflict | Additional surcharges and arrival delays occur. | Shipping line notification, surcharge advisories, alternative route estimates, insurance terms | Confirm war risk, alternative transport, and shipper approval. |
| Customs clearance delayed due to changes in government regulations | Storage fees, inspection costs, and additional document fees are incurred. | Government agency notices, customs clearance records, document submission history, storage fee details | Distinguish between regulatory changes and document advisory omissions. |
| Main vessel skipped port; arranged an alternative route | Re-booking fees, alternative transport costs, and delivery appointment change fees are incurred. | Shipping line notification, booking history, alternative proposals, shipper approval emails | Present cost estimates before arranging alternatives. |
| Major system failure delayed gate-out | Delays in customs clearance, gate-out, and delivery cause storage fees and re-dispatch costs. | Failure notifications, customs records, gate-out records, delivery company invoices | Confirm feasibility of alternative processing and restoration time. |
| Urgently arranged alternative air transport | Whether the shipper approved the costs becomes a key issue. | Alternative transport quotes, email approvals, delivery deadline requests, billing details | Maintain approval records even in emergencies. |
| Delay damages were not covered by marine cargo insurance | Shippers may claim unpaid damages from the freight forwarder. | Insurance terms, exclusion reasons, quotation terms, existence of delivery guarantees | Separate confirmation of insurance exclusions and the freight forwarder's responsibility. |
Four-Column Decision Checklist
When additional costs arise due to force majeure, freight forwarders need to sequentially confirm the cause, process, costs, insurance, approvals, and billing details.
| Confirmation Stage | Party to Confirm With | Items to Confirm | Actions If Issues Arise |
|---|---|---|---|
| Upon Occurrence of Force Majeure Event | Shipping line, port, CFS, local agent, government agencies | What happened, date of occurrence, scope of impact, estimated recovery | Save notifications and announcements, and promptly inform the cargo owner. |
| When Confirming Cargo Location | CFS, CY, warehouse, delivery company, local agent | Current cargo location, possibility to gate out, start date of storage, free time available | Verify earliest gate-out date and the date when charges begin to apply. |
| When Confirming Additional Costs | Shipping line, CFS, warehouse, delivery company | Storage fees, Demurrage, Detention, re-dispatch costs, waiting charges | Obtain detailed billing and reason for charges from the invoicing party. |
| When Confirming Quotation Terms | Sales representative, operations staff, cargo owner | Separate actual costs, force majeure exemptions, non-guarantee of delivery dates, approval procedures for additional costs | If terms are unclear, carefully explain the costs incurred in this case. |
| When Considering Alternative Arrangements | Cargo owner, shipping line, airline, delivery company, local agent | Alternative routes, different shipping line, air transshipment, urgent delivery, rough cost estimates | Make arrangements only after obtaining cargo owner approval. |
| When Confirming Cargo Insurance | Cargo owner, insurance company, insurance agent | Cargo damage, delay damage, War Clauses, Strikes Clauses, ICC terms | Separate insurance coverage from cost bearing clearly. |
| At Billing | Cargo owner, billing party, internal accounting | Cost details, cause of occurrence, approval records, consistency with quotation terms | Explain each item and attach supporting documentation. |
| When Troubles Arise | Cargo owner, internal management, insurance company, experts | Discussion of liability and actual cost responsibility, delays in notification, presence or absence of approvals, insurance coverage | Separate force majeure causes from internal handling issues for clarification. |
Comparison Table of Freight Forwarder Involvement Scope
It is necessary to distinguish what the freight forwarder can support during force majeure events from what should not be definitively concluded. During force majeure, providing information, presenting options, recording approvals, and organizing actual cost details become especially important.
| Category | Support Easily Provided | What Should Not Be Definitely Concluded | Practical Response |
|---|---|---|---|
| Cause Confirmation | Can collect port notifications, shipping line notices, official information, and local agent information. | Definitively concluding legally that the situation constitutes force majeure. | Separate fact-based information from contractual clause interpretation. |
| Cost Estimate Organization | Can organize forecasts of storage fees, Demurrage, Detention, and re-routing costs. | Definitively conclude that additional costs will always be borne by the cargo owner. | Check quotation conditions, approval records, and details from billing sources. |
| Alternative Proposal Presentation | Can compare alternative routes, different shipping lines, air forwarding, and urgent delivery options. | Guaranteeing that alternatives will always meet delivery deadlines. | Indicate costs, estimated lead times, and risks together. |
| Cargo Insurance Confirmation | Can support incident notification to insurers, checking insurance terms, and organizing necessary documentation. | Definitively conclude that insurance claims will always be paid or always denied. | Wait for the insurance company’s decision. |
| Explanation to Cargo Owner | Can explain what happened, which process is halted, and what costs have incurred. | Ending the explanation simply with "It’s force majeure, so it can’t be helped." | Explain causes, impacts, costs, and options separately. |
| Billing Process | Can organize billing source details, reasons for occurrence, and approval records. | Charging as actual cost settlement without supporting evidence. | Attach details, notifications, and approval records. |
| Liability Organization | Can distinguish between force majeure causes and issues in the company’s own response. | Immediately concluding that there is no problem on the company’s side because it is force majeure. | Verify if there were delays in communication, mishandling of arrangements, or insufficient explanations. |
Scenario 1: Port Gate-Out Stopped Due to Typhoon
Shortly after the arrival of imported LCL cargo at the port, port operations and CFS gate-out were suspended due to the impact of a typhoon. The cargo remained inside the CFS, resulting in several days of storage charges.
The cargo owner claimed, “Since the typhoon is nobody’s fault, storage fees should not be charged.” However, the cargo was actually stored at the CFS, and storage charges were incurred. While the freight forwarder is not responsible for the typhoon itself, how the actual costs arising from the CFS are settled is a separate matter.
If the quotation specifies that “storage charges arising from natural disasters, port closures, etc., are charged separately based on actual costs,” the freight forwarder can more easily justify the additional charges.
Scenario 2: Additional Re-dispatch Costs Due to a Port Strike
For import cargo, a port strike occurred on the scheduled CFS gate-out date, making it impossible to dispatch the cargo. The freight forwarder had arranged a truck with a subcontracted carrier, but since dispatch could not be completed that day, cancellation fees and re-dispatch costs were incurred.
The strike itself is outside the freight forwarder’s control. However, if the truck was already arranged, re-dispatch costs may realistically arise.
In this case, it is necessary to confirm when the strike information was obtained, whether the truck cancellation was still possible, at what point the shipper was notified, and whether the estimate terms separately specify actual costs for re-dispatch costs.
Scenario 3: Route Change Due to Conflict
Due to escalating conflict or piracy risks, the shipping line avoided the usual route and selected a detour. As a result, arrival was delayed, and additional fuel costs as well as war risk-related surcharges were incurred.
In this case, the route change was a safety decision by the shipping line and a consequence of the international situation, beyond the freight forwarder's control. If the shipping line imposes additional surcharges, these may be passed on as actual costs according to the quotation terms.
However, the freight forwarder must explain the additional surcharges, expected delays, and availability of alternative routes to the shipper. The shipper should confirm whether they wish to accept the extra cost to proceed via an alternative route.
Scenario 4: Customs Clearance Halted Due to Changes in Administrative Regulations
For imported cargo, just before arrival, inspection requirements for specific items were strengthened or the enforcement of import regulations was changed, causing customs clearance procedures to stop. Submission of additional documents was required, and the cargo remained in a bonded warehouse, resulting in storage fees and extra document preparation costs.
The change in administrative regulations itself is not the responsibility of the freight forwarder. However, the freight forwarder needs to inform the cargo owner about the additional document requirements, explain the authorities' demands, and provide an estimate of the expected storage fees.
On the other hand, if the freight forwarder received requests for additional documents from the authorities but delayed notifying the cargo owner, the issue may not be the regulatory change itself but rather the delayed response.
Scenario 5: Case of Arranging an Alternative Route Due to Vessel Skipping a Port
A shipping line may skip a scheduled port of call due to port congestion or operational reasons, resulting in cargo being discharged at an alternative port. In such cases, additional costs may arise for forwarding from the alternative port to the original delivery location, rebooking fees, and delivery appointment change fees.
While the skipping of a port by the shipping line is often outside the freight forwarder’s control, it is important to communicate with the cargo owner, provide alternative options, and explain the estimated additional costs. In particular, when arranging an alternative route, the cost estimate and revised delivery schedule should be presented, and approval from the cargo owner must be obtained before proceeding.
Scenario 6: Delays in Customs Clearance and Gate-Out Due to System Failure
Large-scale system failures can delay customs declaration, gate-out reservations, shipping line document processing, and warehouse operations. In such cases, cargo cannot be gated out, resulting in storage charges, re-dispatch costs, and document reissuance fees.
Even if the system failure itself is caused by external factors, it is important to consider whether alternative processing was possible, whether appropriate communication was made with the cargo owner, and whether the expected restoration timeline was explained. It is essential to keep records of failure notifications, availability of alternative processing, gate-out logs, and re-dispatch records.
Scenario 7: Cases Where Delay Damages Are Not Covered by Cargo Insurance
Even if delivery is delayed due to port closures or vessel delays, and the shipper incurs penalties from their buyers, standard cargo insurance does not necessarily cover delay damages.
In such cases, shippers may claim that the freight forwarder should bear the costs if insurance does not pay. However, it is important to separately verify the exclusions under cargo insurance and the freight forwarder’s liability for damages. The presence or absence of delivery guarantees, the wording in quotes or contracts, force majeure grounds, delay exemptions, and communication with the shipper should all be carefully reviewed.
Practical Organization Method
When additional costs arise due to force majeure, the first step is to identify the cause. Confirm what the direct cause is, such as natural disasters, port closures, strikes, war, administrative regulations, or suspension of shipping line operations.
Next, determine which stage of the process is affected. Distinguish whether the issue is occurring at vessel operation, cargo handling, CFS operations, customs clearance, CY gate-out, inland delivery, or final delivery.
Then, organize the incurred costs by category. Separate storage fees, Demurrage, Detention, re-dispatch costs, alternative transport costs, document fees, etc., and confirm how these are treated under the quotation terms.
When arranging alternative routes or emergency measures, it is important to explain cost estimates, delivery time expectations, and risks to the cargo owner, and obtain approval before proceeding. Especially in force majeure situations, maintaining records helps prevent future disputes.
Summary
Force majeure and additional costs are practical issues that must always be clarified in freight forwarder quotation terms. Due to natural disasters, war, port closures, strikes, administrative regulations, and other factors, charges not included in the original quotation—such as storage fees, rebooking costs, Demurrage, Detention, and alternative transportation expenses—may occur.
Force majeure can be an issue in denying or limiting the freight forwarder's liability for damages. However, the actual expenses incurred due to force majeure do not simply disappear.
In freight forwarder practice, it is important not to treat force majeure solely as a ground for exemption but to clarify what happened, which process was halted, what costs arose, and who should approve and bear those costs.
Shippers should also confirm at the quotation stage how cost responsibility is handled during force majeure, the treatment of delivery delays, the coverage scope of marine cargo insurance, and the approval procedures for alternative arrangements.
Marine cargo insurance conditions can vary significantly beyond the premium. For choosing coverage conditions and interpreting policy clauses, please consult specialized insurance companies or agents.
