The Motor Carrier Protection Act of 2010 (Senate Bill S. 3483) was introduced and referred to the Senate Committee on Commerce, Science and Transportation on June 14, 2010. If passed, Part 139 of Title 49 of the United States Code would be amended to add more regulation and oversight of transportation brokers and freight forwarders, with the purported goal of protecting smaller carriers from fraudulent or abusive brokers.
The bill imposes a number of new requirements on carriers, brokers and forwarders. Among other things, the bill:
- Increases the broker bond from $10,000 to $100,000 and applies the bonding requirement to freight forwarders;
- Clarifies that trucking companies must have broker authority or freight forwarder authority in addition to their motor carrier authority to arrange freight through another carrier for compensation; and
- Creates an annual operating authority renewal requirement for brokers and freight forwarders; and requires the FMCSA to revoke operating authority that is not renewed annually.
The full text of the bill can be viewed at: http://www.govtrack.us/congress/billtext.xpd?bill=s111-3483.
Today the United States Supreme Court ruled that the Carmack Amendment does not apply to the inland rail portion of international, multimodal import shipments moving under through bills of lading (i.e., those covering both the ocean and inland portions of transport in a single document) and that the forum selection clause contained in the bills is enforceable. The bills designated COGSA (the Carriage of Goods by Sea Act) as the law governing the carriers’ responsibility for cargo loss and damage claims during the entire shipment; contained a “Himalaya Clause,” which extends the bills’ defenses and liability limitations to subcontractors; and designated a Tokyo court as the venue for any dispute. The 6-3 decision was issued in the companion cases of
Union Pacific Railroad Company v. Regal-Beloit Corporation and
Kawasaki Kisen Kaisha v. Regal-Beloit Corporation.
The United States Supreme Court is set to hear argument on March 24, 2010 in the companion cases of Union Pacific Railroad Company v. Regal-Beloit Corporation and Kawasaki Kisen Kaisha v. Regal-Beloit Corporation. The issue before the Court is whether the Carmack Amendment to the Interstate Commerce Act (49 U.S.C. § 11706 for rail carriers and § 14706 for motor carriers) applies to the inland rail portion of an international, multimodal import shipment governed by a “through” bill of lading (i.e., a bill of lading that covers the shipment from origin to destination), where the bill designated the Carriage of Goods by Sea Act, 46 U.S.C. § 30701 et seq., as the law to govern the carriers’ responsibility for cargo loss and damage claims during the entire shipment.
COGSA governs the rights and liabilities of parties to an international maritime bill of lading; and allows parties to extend COGSA liability terms by contract for the entire carriage - including any inland leg of the journey. The Carmack Amendment supplies the default liability regime for rail and motor carrier transportation within the United States. The Interstate Commerce Act authorizes both common carriers and contract carriers to contract out of Carmack's default rules (49 U.S.C. § 10709). The question presented to the Court, therefore, is how to reconcile the potentially conflicting statutory frameworks under the facts of the cases.
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