Inside
this issue:
Obtaining the proper coverage in the
event of ocean carrier insolvency
Increased limitations on IATA air
waybills effective Dec. 30, 2009
FMC ruling allows OTIs to use
unlicensed agents
Commercial bankruptcies continue as
U.S. moves out of a recession
FMCSA proposes higher UCR fees and
reviews HOS
|
FMC
ruling allows OTIs to use unlicensed agents
The Federal Maritime Commission (FMC) has
issued an order affirming that it is lawful for a licensed
ocean transportation intermediary (OTI) to engage unlicensed
persons to act as their agents to perform OTI services.
The order reverses an FMC ruling from 2008, which stated
that “only licensed persons are permitted to provide OTI
services to the public.” The FMC’s initial position on the
issue was announced in our
April 2008 Special Quest.
The issue began in 2006, when a Texas-based OTI sought the
use of unlicensed agents to perform OTI services on behalf
of licensed OTIs in the United States, which was not
permitted under FMC regulations. The company proposed having
agents provide ocean transportation services on its behalf
and in its name. These would include typical OTI services
such as: marketing, booking cargo with ocean carriers,
preparing shipping documents, issuing house bills of lading,
accepting import cargo shipments for consignees and
arranging for delivery of cargo for export shipments.
After the FMC denied the OTI’s request, a Florida-based OTI
petitioned the U.S. Court of Appeals for the District of
Columbia Circuit to review the FMC’s order. The appeals
court overturned the FMC ruling, saying that the plain
language of the Shipping Act requires OTIs to have licenses,
but agents of such companies are not included. If an agent
is not holding itself out as an OTI in its own right, it
does not require a license. The court’s decision may be
viewed
here.
In line with the decision, the FMC granted a new declaratory
order allowing the use of unlicensed agents, which may be
viewed in full
here.
Avalon remains committed to providing the highest level of
service to our clients and will keep you apprised of
governmental changes impacting your business. We are a
leading provider of U.S. Customs bonds and other surety and
insurance products for customs brokers and transportation
providers. |
