[Federal Register Volume 65, Number 101 (Wednesday, May 24, 2000)]
[Rules and Regulations]
[Pages 33479-33480]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-13088]


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FEDERAL MARITIME COMMISSION

46 CFR Part 515, 545

[Docket No. 00-06]


Interpretations and Statements of Policy Regarding Ocean 
Transportation Intermediaries

AGENCY: Federal Maritime Commission.

ACTION: Interpretive rule.

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SUMMARY: The Federal Maritime Commission amends its regulations for 
interpretive statements of policy to interpret a section of its 
regulations regarding ocean transportation intermediaries to clarify 
the claim settlement procedures.

DATES: This rule is effective June 23, 2000.

FOR FURTHER INFORMATION CONTACT: Thomas Panebianco, General Counsel, 
Federal Maritime Commission, 800 North Capitol St. NW, Room 1018, 
Washington, DC 20573-0001; (202) 523-5740.

SUPPLEMENTARY INFORMATION: On March 8, 1999, the Federal Maritime 
Commission published a final rule and interim final rule to add new 
regulations at 46 CFR part 515 to implement changes made by the Ocean 
Shipping Reform Act of 1998 (``OSRA''), Public Law 105-258, 112 Stat. 
1902, to the Shipping Act of 1984 (``Shipping Act''), 46 U.S.C. app. 
1701 et seq., relating to ocean transportation intermediaries 
(``OTIs''). 64 FR 11156-11183. Section 515.23(b) sets forth the claim 
settlement procedure for claimants seeking to pursue a claim against an 
OTI. The Interpretive Rule seeks to clarify the Commission's intention 
with respect to this procedure, as there have been reported 
misunderstandings in the industry as to the responsibilities inherent 
in this requirement.
    Section 515.23(b)(1) sets forth the claim settlement procedures and 
provides, in part, that:

    If a party does not file a complaint with the Commission 
pursuant to section 11 of the Act, but otherwise seeks to pursue a 
claim against an ocean transportation intermediary bond, insurance 
or other surety for damages arising from its transportation-related 
activities, it shall attempt to resolve its claim with the financial 
responsibility provider prior to seeking payment on any judgment for 
damages obtained.

It is the Commission's intention that a claimant seeking to settle a 
claim in accordance with this section should promptly provide to the 
financial responsibility provider all documents and information 
relating to and supporting its claim for the purpose of evaluating the 
validity and subject matter of the claim. The information relevant to 
the claim settlement procedure includes documents such as bills of 
lading, as well as the existence of pending court claims or judgments 
obtained.
    In addition, the financial responsibility provider is allowed to 
evaluate the validity of the claim during the settlement process in 
Sec. 515.23(b)(1). However, if the parties do not reach a settlement of 
the claim, the financial responsibility provider, in accordance with 
section 19 of the Shipping Act, 46 U.S.C. app. 1718 (1999), and 46 CFR 
515.23(b)(2), must pay on a final judgment and may only inquire into 
the extent that the damages claimed arise from the transportation-
related activities of the OTI, under section 3(17) of the Shipping Act, 
46 U.S.C. app. 1702(17).
    Furthermore, if settlement of the claim is not reached, the 
financial responsibility provider may not unilaterally reduce the 
amount awarded in a final court judgment; Congress has determined that, 
at that point, a financial responsibility provider must pay on a final 
judgment for damages arising from the transportation-related activities 
of the OTI, and the Commission cannot nullify that statutory 
requirement. However, the financial responsibility provider and the 
claimant are not precluded from mutually agreeing to compromise the 
amount awarded in a final judgment. In the event that the financial 
responsibility provider believes that a judgment against its OTI bond 
principal was obtained fraudulently, or that the claim underlying the 
judgment is itself fraudulent, the financial responsibility provider is 
not precluded from challenging a judgment if permitted in the 
jurisdiction where it was obtained.

[[Page 33480]]

Relevant Federal Rules That May Duplicate, Overlap, or Conflict 
With the New Rule.

    The Commission is not aware of any other federal rules that 
duplicate, overlap, or conflict with the final rulemaking.

List of Subjects

46 CFR Part 515

    Exports, Freight, Freight forwarders, Maritime carriers, Non-
vessel-operating common carriers, Ocean transportation intermediaries, 
Licensing requirements, Financial responsibility requirements, 
Reporting and recordkeeping requirements.

46 CFR Part 545

    Antitrust, Exports, Freight forwarders, Maritime carriers, Non-
vessel-operating common carriers, Ocean transportation intermediaries, 
Licensing requirements, Financial responsibility requirements, 
Reporting and recordkeeping requirements.

    For the reasons stated in the preamble, the Federal Maritime 
Commission amends 46 CFR chapter IV, subchapter B, as set forth below:

PART 515--LICENSING, FINANCIAL RESPONSIBILITY REQUIREMENTS, AND 
GENERAL DUTIES FOR OCEAN TRANSPORTATION INTERMEDIARIES

    1. The authority citation for part 515 continues to read as 
follows:

    Authority: 5 U.S.C. 553, 31 U.S.C. 9701; 46 U.S.C. app. 1702, 
1707, 1709, 1710, 1712, 1714, 1716, and 1718; Pub. L. 105-383, 112 
Stat. 3411; 21 U.S.C. 862.

    2. In Sec. 515.23, revise the introductory text to read as follows:


Sec. 515.23  Claims against an ocean transportation intermediary.

    The Commission or another party may seek payment from the bond, 
insurance, or other surety that is obtained by an ocean transportation 
intermediary pursuant to this section. (See also Sec. 545.3 of this 
chapter.)
* * * * *

PART 545--INTERPRETATIONS AND STATEMENTS OF POLICY

    1. The authority citation for part 545 is revised to read as 
follows:

    Authority: 5 U.S.C. 553; 46 U.S.C. app. 1706, 1707, 1709, 1716, 
and 1718; Pub. L. 105-383, 112 Stat. 3411; 46 CFR 515.23.

    2. Add Sec. 545.3 to read as follows:


Sec. 545.3  Interpretation of Sec. 515.23(b) of this chapter--Payment 
pursuant to a claim against an ocean transportation intermediary.

    A claimant seeking to settle a claim in accordance with 
Sec. 515.23(b)(1) of this chapter should promptly provide to the 
financial responsibility provider all documents and information 
relating to and supporting its claim for the purpose of evaluating the 
validity and subject matter of the claim.

    By the Commission.
Bryant L. VanBrakle,
Secretary.
[FR Doc. 00-13088 Filed 5-23-00; 8:45 am]
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