FMC wants OTIs to obtain bonds faster
The U.S. Federal Maritime Commission is proposing to amend regulations governing the filing of proof of financial responsibility for ocean freight forwarders and non-vessel-operating common carriers.
So-called ocean transport intermediaries, or OTIs, would have to file proof of financial responsibility within 120 days instead of having up to two years after approval of an applicant’s license.
The FMC said the extended two-year period has created two areas of concern.
“First, this may be viewed as an opportunity by applicants who have been deemed approved but who have gone two years without procuring a surety bond to nonetheless commence providing OTI services,” the FMC explained. That would frustrate the goal of the regulation, which is to protect shippers, it added.
Second, “an applicant’s inability or unwillingness to procure a surety bond over the course of two years may be an indication of questionable financial integrity,” the commission said.
The FMC said it found half of recipients of OTI licenses in fiscal 2006 obtained surety bonds within 30 days and 87 percent within 120 days.
The commission said the proposed rule would not have a significant impact on a substantial number of small businesses.
The FMC is asking for comments on the proposed change by Aug. 27.
FMC wants OTIs to obtain bonds faster
