FMC Begins Proceedings to Revoke OTI Licenses of 8 Entities (Due to Their Surety Losing Treasury Certification, Etc.)
The Federal Maritime Commission (FMC) has begun proceedings to revoke the ocean transportation intermediary (OTI) licenses of 8 entities as a result of their failure to replace their OTI surety bonds with a valid bond issued by a surety company currently certified by the Treasury Department (Treasury).
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Entities Must Obtain New OTI Bonds as Current Surety Company is Not Certified
According to the FMC, in June 2003, the Treasury terminated the Certificate of Authority issued to American Motorists Insurance Company, which had qualified that company as an acceptable surety on Federal bonds. The FMC explains that once this occurs, bonds that are continuous in nature remain valid and effective for the purposes issued, but may no longer be renewed.
Therefore, the FMC states that commencing on the anniversary date of such termination, OTI's holding surety bonds issued by American Motorists Insurance Company were obligated to replace their OTI surety bond with a valid bond issued by a surety company currently certified by Treasury.
Following direct notice to the affected parties and an extended period to bring themselves into compliance, the FMC states that it appears that the following 8 OTIs no longer meet the requirements for demonstrating financial responsibility imposed by Section 19 of the Shipping Act:
| Organization Number | Name |
|---|---|
| 004278 | Cambell & Gardiner, Inc. |
| 008727 | Ken Lehat & Associates, Inc. |
| 015494 | Ocean Transportation Services, LLC |
| 011405 | Interfreight, Inc. |
| 016391 | Caribbean American Shipping Corp. |
| 008751 | Ford International Forwarding, Inc. |
| 016817 | Independence Shipping Lines, Ltd. |
| 017387 | S & B International Freight Forwarders, Inc. |
The FMC is ordering them, among other things, to show cause why it should not revoke their OTI licenses and order them to cease and desist from operation as OTIs in the foreign trade of the U.S.
(The FMC explains that each OTI must establish its financial responsibility by furnishing the FMC a surety bond, evidence of insurance, or evidence of guaranty to provide coverage for damages, reparations or penalties arising from the OTI's transportation-related activities. In the case of surety bonds, applicable regulations specify that such bonds must be issued by a surety company found acceptable by the Treasury Secretary.)
FMC sources indicate that organization numbers are assigned to identify entities and in some cases they are the same as the entity's license number while in other cases they are different.
-affidavits of fact and memoranda of law are to be filed by respondents and any intervenors in support of the respondents no later than April 17, 2006.
-BOE and any intervenors in opposition to respondents shall file reply affidavits and memoranda of law no later than May 17, 2006.
-rebuttal affidavits and memoranda of law shall be filed by respondents and intervenors in support by no later than June 1, 2006.
-requests for evidentiary hearings or oral arguments shall be filed no later than May 17, 2006.
-FMC shall make its final decision in this proceeding by October 31, 2006.
FMC Order to Show Cause (D/N 06-04, dated 03/10/06) available at http://www.fmc.gov/file.asp?F=10E48371F844455ABF437C4EB146F4E5%2Epdf&N=06%2D04ShowCauseOrder%2Epdf&C=docket_activity
FMC closed meeting on this issue (FR Pub 03/03/06) available at http://a257.g.akamaitech.net/7/257/2422/01jan20061800/edocket.access.gpo.gov/2006/pdf/06-2093.pdf