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Have a question? +1 815-826-6324 (815-8-BondAI) phil@AmericasSuretyBonds.com
Army Veteran Owned | Expert Surety Bonds Since 2004
No one can act as a steamship agent at the Port of Mobile without an Alabama State Port Authority license, and the license does not issue without the $25,000 bond. A surety bond keeps that $25,000 in your operating account instead of tied up in a letter of credit or cash deposit.
The Alabama State Port Authority requires every steamship agent to hold a Port Authority license, and Item 221 of its General Cargo / Intermodal Tariff 1-E requires a $25,000 performance bond in favor of the Authority with the application. The license runs January 1 through December 31, costs $600 to obtain and $300 a year to renew, and also requires $1,000,000 in general liability insurance, a City of Mobile business license and a staffed office in the Mobile metropolitan area.
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Item 221 of the Alabama State Port Authority's General Cargo / Intermodal Tariff 1-E says no person, firm, corporation or other business entity may operate as or carry on the business of a steamship agent until it holds a license issued by the Port Authority. The application must include a performance bond of $25,000 in favor of the Authority. The tariff also accepts a surety bond or letter of credit, and a surety bond is usually the option that ties up the least capital.
The bond is one of several items. The tariff requires proof of insurance under Item 244, with Commercial General Liability set at $1,000,000 for steamship agents, a copy of a valid City of Mobile business license, and a local office within the Mobile metropolitan area staffed full time. The license fee is $600 for an original application and $300 for each annual renewal.
The bond secures the agent's obligations to the Port Authority under its tariffs. That matters because agents carry real exposure at Mobile. Under Item 224, an agent that submits a berth application agrees to be separately bound and ultimately liable for the charges incurred. Item 222 sets Port Authority invoices as payable in full within 21 calendar days, and where the Authority requires a deposit, performance bond or letter of credit for credit, the amount is fixed by the Authority and never less than $25,000. An agent that runs more than 60 days in arrears can be removed from all credit lists until it furnishes a specific performance bond acceptable to the Treasurer, issued by a corporate surety authorized to do business in Alabama.
Licenses run on the calendar year, January 1 through December 31. Renewal requests must be submitted in writing at least 30 days before expiration. A license that is not renewed expires at midnight December 31, so the bond should stay in force without a gap across the renewal. The Authority can revoke or refuse to renew for failure to follow the tariffs, failure to pay promptly, false or misleading information, neglect of duty or incompetence. A licensee has 10 working days from written notice to file a protest and request an appeal hearing.
The premium is an annual charge on the $25,000 bond amount. The surety sets it from the agency's financial strength, the owners' credit and its payment history with the port.
For questions on Tariff 1-E, the Port Authority lists 251.441.7236.
Every license runs January 1 through December 31. Submit your renewal in writing at least 30 days before it expires. If you miss it, the license lapses automatically at midnight December 31.
$600 for the original application and $300 for each annual renewal under Item 221 of Tariff 1-E.
Yes. Item 221 accepts a performance bond, surety bond or letter of credit for the $25,000. A letter of credit usually ties up a bank line for the full amount, while a surety bond costs an annual premium.
Yes. Under Item 224, an agent that submits a berth application agrees to be separately bound and ultimately liable for payment of the charges incurred. That exposure is part of why the Port Authority requires the bond.
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