FMC Moves Closer to New Rules for Intermediaries

FMC Moves Closer to New Rules for Intermediaries

The Federal Maritime Commission voted 3-2 to move forward with changes to rules governing non-vessel-operating common carriers and freight forwarders.

The proposed new rules would require licensed ocean transportation intermediaries to renew their licenses every two years, and require NVOs based in other countries to have a U.S. presence that is staffed full-time.

The FMC voted for an advanced notice of proposed rulemaking that will be published in the Federal Register, starting a 60-day notice and comment period preceding the publication of the final rule.

New qualifications for OTI licensing would include three years of “relevant and diverse” experience with a licensed OTI. The FMC would be empowered to review a qualifying individual’s character at any time and disqualify anyone found to have violated shipping laws, to have operated while unlicensed or to have been suspended from the Transportation Worker Identification Credential.

The proposed reforms also would change rules under which parties seek payment from an OTI’s bond, insurance, or surety. Carriers and marine terminals would have to submit notices to the FMC of claims that may result in court action and judgments. The FMC would then post these notices on its Web site, with the disclaimer that not all posted claims have merit.

Commissioner Doyle, who voted with Commissioner Richard Lidinsky and FMC Chairman Cordero to move forward with the reforms, said the proposal may be adjusted during the notice and comment period. Commissioners Rebecca Dye and Khouri voted against moving forward with the proposal.

Dye and Khouri said the reforms would increase compliance costs in the absence of a clearly defined harm. Dye advocated harmonizing the OTI rules with the MAP-21 transportation bill, which regulates motor carriers and brokers of transportation services. MAP-21 requires brokers to renew their registration every five years, and requires $75,000 proof of financial responsibility.