How is demurrage calculated? Chargeable days equal the total days a container is held minus the free-time allowance, and the charge is calculated by applying the relevant daily rate to those chargeable days.
The practical complexity comes from tiered tariffs because the daily price normally rises as the overstay continues.
Quick Answer
The basic formula is: chargeable days = total days held – free time, and demurrage charge = chargeable days x the applicable daily rate. Free time generally starts when the container is discharged from the vessel and made available for pickup, not when the vessel arrives or berths. At Jebel Ali, carriers commonly allow around 5 to 7 free days, depending on the carrier, contract, and container type. Indicative UAE tariffs have shown around AED 15 to AED 25 per day for the first days after free time, rising through tiers to AED 120 to AED 150 or more after around three weeks.
A 40-foot container generally costs more than a 20-foot container. Refrigerated and dangerous goods carry premium rates. Detention uses a similar formula but runs on a separate clock after the container leaves the terminal, with its own free time and daily rates.
About Faris Raian
Faris Raian is the Founder, Managing Partner, and Senior Legal Consultant at Leaders Advocates. He brings more than 15 years of experience across commercial, corporate, real estate, family, and criminal law in UAE courts, with experience relevant to commercial shipping charges, carrier contracts, and maritime-adjacent disputes.
How Is Demurrage Calculated Using the Core Formula?
Chargeable days = Total days held – Free time
Demurrage charge = Chargeable days x Daily rate
The formula is simple, but the applicable daily rate is normally tiered rather than flat, so later days cost more than earlier days.
Received a Demurrage Bill That Looks Too High?
Demurrage charges depend on the discharge date, free-time allowance, tariff tiers, container type, and the daily rates actually agreed. Get the calculation and supporting shipping documents reviewed before accepting or disputing the amount.
When Does Free Time Start?
Free time generally starts from the day the container is discharged from the vessel and made available for pickup. It does not generally start from the vessel’s arrival or berthing date.
At Jebel Ali, carriers commonly provide around 5 to 7 free days, although the exact allowance depends on the carrier, contract, and container type.
A Worked Jebel Ali Example
Assume a standard container receives 5 free days and remains at the terminal for 15 days in total. The following bands are illustrative only because actual carrier tariffs vary.
• Free time, days 1 to 5: 5 days at AED 0.
• Tier 1, days 6 to 10: 5 days at approximately AED 30 to AED 50 per day.
• Tier 2, days 11 to 15: 5 days at approximately AED 60 to AED 100 per day.
The total is 5 days at the lower tier plus 5 days at the higher tier. It is materially more than multiplying all 10 chargeable days by a single starting rate because the later days cost more.
Indicative Tiered Rates
Indicative UAE port tariffs have shown roughly AED 15 to AED 25 per day during the first few days after free time. Rates then rise through progressively higher bands and commonly reach AED 120 to AED 150 or more per day after around three weeks.
Rates can be higher for larger 40-foot containers.
What Affects the Rate?
• Container size: a 40-foot container generally costs more per day than a 20-foot container.
• Cargo type: refrigerated and dangerous goods carry premium rates because of additional handling and risk.
• Weekends and public holidays: some tariffs count working days toward free time while others count every calendar day.
• Combined or separate free time: some contracts combine demurrage and detention allowances, while others use separate clocks.
Demurrage and Detention Use Separate Clocks
Demurrage runs while the loaded container remains inside the port or terminal. Detention runs after the container leaves the terminal until the empty unit is returned to the carrier.
A single shipment can incur both charges on two different clocks with different free-time allowances and rate structures.
Disputing a demurrage bill? Faris Raian and the team at Leaders Advocates can check the discharge date, free-time clause, tariff tiers, container type, daily rates, and separate detention exposure.
Unsure How Your Demurrage Charges Were Calculated?
A tiered tariff can make the final amount significantly higher than a simple daily-rate calculation. Have the free days, chargeable period, applicable rate bands, weekends, holidays, and container details checked against the relevant terms.
Common Mistakes
• Starting free time from the vessel’s arrival rather than container discharge and availability.
• Applying one flat rate to every overstay day when the tariff is tiered.
• Assuming weekends and holidays are excluded without checking the specific carrier contract.
Relevant Legal Services
A Maritime Lawyer in Dubai can assess the shipping charge. A Contract Lawyer in Dubai can review free time and tariff wording, while a Litigation Lawyer in Dubai can assist if the bill becomes a formal dispute.
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Conclusion
How is demurrage calculatedin the UAE? The formula uses chargeable days and daily rates, but the final cost depends on discharge timing, free time, tiered bands, container and cargo type, calendar rules, and any separate detention clock.
Disputing Demurrage or Detention Charges in the UAE?
Demurrage and detention can run on separate clocks with different free-time allowances and daily rates. A UAE maritime lawyer can review the carrier terms, container timeline, invoices, and supporting records to assess the disputed charges.
