PART 506 -- CIVIL MONETARY
PENALTY INFLATION ADJUSTMENT

Sec.

506.1 Scope and purpose.

506.2 Definitions.

506.3 Civil Monetary Penalty Inflation Adjustment.

506.4 Cost of Living Adjustments of Civil Monetary Penalties.

506.5 Application of Increase to Violations.

Authority: 28 U.S.C. § 2461

Source: 61 FR 52704, October 8, 1996, unless otherwise noted.

§ 506.1 Scope and purpose.

The purpose of this Part is to establish a mechanism for the regular adjustment for inflation of civil monetary penalties and to adjust such penalties in conformity with the Federal Civil Penalties Inflation Adjustment Act of 1990, 46 U.S.C. 2461, as amended by the Debt Collection Improvement Act of 1996, P. Law 104-134, April 26, 1996, in order to maintain the deterrent effect of civil monetary penalties and to promote compliance with the law.

§ 506.2 Definitions.

(a) "Commission" means the Federal Maritime Commission.

(b) "Civil Monetary Penalty" means any penalty, fine, or other sanction that

(1)(i) is for a specific monetary amount as provided by Federal law; or

(ii) has a maximum amount provided by Federal law; and

(2) is assessed or enforced by the Commission pursuant to Federal law; and

(3) is assessed or enforced pursuant to an adminstrative proceeding or a civil action in the Federal Courts.

(c) "Consumer Price Index" means the Consumer Price Index for all urban consumers published by the Department of Labor.

§ 506.3 Civil Monetary Penalty Inflation Adjustment.

The Commission shall, not later than October 23, 1996, and at least once every 4 years thereafter --

(a) by regulation adjust each civil monetary penalty provided by law within the jurisdiction of the Commission by the inflation adjustment described in section 506.4 of this Part; and

(b) publish each such regulation in the Federal Register.

§ 506.4 Cost of Living Adjustments of Civil Monetary Penalties.

(a) The inflation adjustment under section 506.3 of this Part shall be determined by increasing the maximum civil monetary penalty for each civil monetary penalty by the cost-of-living adjustment. Any increase determined under this subsection shall be rounded to the nearest:

(1) multiple of $10 in the case of penalties less than or equal to $100;

(2) multiple of $100 in the case of penalties greater than $100 but less than or equal to $1,000;

(3) multiple of $1,000 in the case of penalties greater than $1,000 but less than or equal to $10,000;

(4) multiple of $5,000 in the case of penalties greater than $10,000 but less than or equal to $100,000;

(5) multiple of $10,000 in the case of penalties greater than $100,000 but less than or equal to $200,000; and

(6) multiple of $25,000 in the case of penalties greater than $200,000.

(b) For purposes of paragraph (a) of this section, the term 'cost-of-living adjustment' means the percentage (if any) for each civil monetary penalty by which the Consumer Price Index for the month of June of the calendar year preceding the adjustment, exceeds the Consumer Price Index for the month of June of the calendar year in which the amount of such civil monetary penalty was last set or adjusted pursuant to law.

(c) Limitation on Initial Adjustment. The first adjustment of civil monetary penalty pursuant to section 506.3 of this Part may not exceed 10 percent of such penalty.

(d) Inflation Adjustment. Maximum Civil Monetary Penalties within the jurisdiction of the Federal Maritime Commission are adjusted for inflation as follows:

United States Code Citation	Civil Monetary Penalty description	Current maximum penalty amount	New adjusted maximum penalty amount
46 U.S.C. app. sec. 817d	Failure to establish financial responsibility for death or injury	5,500 220	6,000 2201
46 U.S.C. app. sec. 817e	Failure to establish financial responsibility for non-performance of transportation	5,500 220	6,000 2201
46 U.S.C. app. sec. 876	Failure to provide required reports, etc. -- Merchant Marine Act of 1920	5,500	6,000
46 U.S.C. app. sec. 876	Adverse shipping conditions/Merchant Marine Act of 1920	1,100,000	1,175,000
46 U.S.C. app. sec. 876	Operating after tariff or service contract suspension/Merchant Marine Act of 1920	55,000	60,000
46 U.S.C. app. sec. 1710a	Adverse impact on U.S. carriers by foreign shipping practices	1,100,000	1,175,000
46 U.S.C. app. sec. 1712	Operating in foreign commerce after tariff suspension	55,000	60,000
46 U.S.C. app. sec. 1712	Knowing and willful violation/Shipping Act of 1984 or Commission regulation or order	27,500	30,000
46 U.S.C. app. sec. 1712	Violation of Shipping Act of 1984, Commission regulation or order, not knowing or willful	5,500	6,000
31 U.S.C. sec. 3802(a)(1)	Program Fraud Civil Remedies Act/giving false statement	5,500	6,000
31 U.S.C. sec. 3802(a)(2)	Program Fraud Civil Remedies Act/giving false statement	5,500	6,000

1/ Application of the statutory rounding resulted in no increase to these penalties.

[64 FR 23545, May 3, 1999; 65 FR 49741, August 15, 2000]

§ 506.5 Application of Increase to Violations

Any increase in a civil monetary penalty under this Part shall apply only to violations which occur after the date the increase takes effect.

Last Update: August 15, 2000