FMC to implement new final rule for OTI Oversight
The Federal Maritime Commission, under the 2018 Frank LoBiondo Coast Guard Authorization Act, will now hold increased authority over licensed Ocean Transportation Intermediaries (OTIs), including freight forwarders and non-vessel-operating common carriers (NVOs). The Final Rule includes following points:
- Persons who hold themselves as OTIs must be licensed with FMC and meet certain financial responsibility requirements.
- It does not include a person performing OTI services on behalf of an OTI for which it is a disclosed agent.
- Prohibition on Carriers knowingly or willfully handling cargo for OTIs that do not meet financial responsibility requirements.
- The comments submitted to FMC regarding filed ocean common carrier and Marine Terminal Operator Agreements to be kept confidential.
However, the final rule must still be reviewed by the Office of Information and Regulatory Affairs before it can be published in the Federal Register. It is expected to be published in the Federal Register and made effective in 30 days following publication.
Another new final rule on “Licensing, Registration, Financial Responsibility Requirements and General Duties for Ocean Transportation Intermediaries” took effect from 16th December 2019. The Key changes include:
- The NVO must have the required bond, insurance and other form of surety along with Form FMC-1 (Published Tariff Location) before obtaining NVO license from FMC.
- Applicants employing officers, managers or members from an OTI whose license was revoked or denied within the previous three years are subject to direct commission review.
- Applicants previously determined to be unqualified to provide OTI services are subject to direct commission review.
- Clarification on eligibility to be a qualified individual when partnerships are involved.
- The initial renewal of an OTI license can take place no sooner than one year and no later than four years from issuance. All subsequent renewals will take place on regular three-year intervals.
- All application forms (FMC-18) are now filed electronically.