Laytime represents the allocated time frame for a vessel to perform cargo loading and discharge, while demurrage serves as compensation when the loading or discharge exceeds the laytime. Calculating laytime typically involves three key stages:

1. Establishing Commencement: Laytime begins following the valid submission of a Notice of Readiness (NOR). The NOR is considered valid if the vessel:

• has arrived at the agreed destination (a port, berth, or dock depending on the type of the charterparty) within the period of time agreed by the parties (laydays), and
• is ready for loading in all respects: both legal and physical (cargo spaces are ready for loading and discharge, vessel is properly equipped, all relevant documentation is in order and etc.)

2. Determining Duration: Laytime typically runs uninterrupted from commencement until cargo operations conclude or the laytime expires. There are different types of laytime, including:

• WIPON (Whether In Port Or Not)
• WIBON (Whether In Berth Or Not)
• WICCON (Whether Customs Cleared Or Not)
• WIFPON (Whether In Free Pratique Or Not)

3. Accounting for Interruptions: Certain exceptions can interrupt laytime based on specific clauses in the charterparty. Common interruptions include:

• Weather Conditions: Laytime doesn’t accrue during adverse weather periods when loading or discharge operations are impeded (e.g., “WWD” – Weather Working Day).
• Weekends and Holidays: Laytime may exclude Sundays and holidays (e.g., “SHEX” – Sundays and Holidays Excepted).
• Berth Shifting: Laytime can pause when a vessel shifts from one berth to another.
• Strikes: Industrial actions can also interrupt laytime.

Demurrage and Dispatch: If laytime expires before cargo operations conclude, the charterer typically pays demurrage. Conversely, if loading or discharge is completed more efficiently than the stipulated laytime, the ship owner may receive despatch as a reward. Demurrage rates are usually outlined in the contract, while despatch rates are often half of the demurrage rate or may not be specified at all.

Detention: When a vessel experiences delays post-loading or discharge, the charterer compensates for detention. Unlike demurrage, which has predefined rates, detention can encompass various damages related to delays after cargo operations’ completion.

Demurrage Claims: To claim demurrage, specific documents are generally required, including an invoice, timesheet, NOR, and a Statement of Facts. The charterparty or contract may impose additional document requirements. There is a limitation period for demurrage claims, often shortened to a maximum of 60 days by charterparty riders. Missing the deadline, even by a day, can render the claim time-barred.

Container Demurrage and Detention: In the context of container shipping, container demurrage applies after unloading. Consignees are expected to collect cargo and return cleaned containers within a specified free time. Container demurrage incurs fees for keeping containers at the port beyond the free time, charged per day with progressive rates for longer delays.