.
The Quest
Inside this issue:

Help us with our Hurricane Sandy relief efforts; Risk management tips to help your business

What you need to know about the 2012 Transportation Bill

NVOCC China rider increase effective Nov. 23

New provisions regarding legal disputes for freight forwarders in China

New Jersey seeks to ban companies classifying truck drivers as independent contractors

Customs brokers face increased liability risks under food safety act

CARB Update: Clarification of regulations applicability to customs brokers, freight forwarders and NVOCCs nationwide; new SmartWay regulations

CBP updates ACEopedia
(click here to access)


                    


NVOCC China rider increase effective Nov. 23

Effective Nov. 23, the Federal Maritime Commission will amend its regulations regarding the amount of the optional China rider for NVOCC bonds.

In 2003, China agreed to let U.S. licensed NVOCCs post a $21,000 bond rider to satisfy the requirement that an NVOCC post an 800,000 RMB cash deposit with a Chinese bank. This requirement applies to NVOCCs wishing to serve in the U.S.-China trade. The amount was intended to cover potential claims from the Chinese Ministry of Transport arising from violations of Chinaís maritime transportation regulations.

China asserts that because the exchange rate between the dollar and the RMB has risen about 21% since 2003, that the rider amount no longer corresponds with 800,000 RMB. The FMC has therefore increased the rider amount from $21,000 to $50,000. It is also important to note that now, if an NVOCC has an increased bond amount because of the existence of branch offices ($10,000 per branch), and their total bond amount equals or exceeds $125,000, their existing bond will satisfy the new requirement.

To view the original Federal Register amount in full, please visit http://www.gpo.gov/fdsys/pkg/FR-2012-08-28/html/2012-21095.htm
 

Avalonís Bond Underwriting department has already identified existing bondholders with China Riders that will need to be increased, and if you have an existing China Rider, your local Avalon office will be in contact with you accordingly. Our Centralized Bond Unit is also coordinating the submission of the increased riders to the FMC to ensure compliance with the deadline.


    
For more information, please contact your local Avalon office or Andriana Davis at (847) 700-8087 or at adavis@avalonrisk.com. A list of our offices may be found at www.avalonrisk.com/contact.html
             
       

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