By David Shepardson

WASHINGTON (Reuters) - The company that built a Seattle amphibious "duck boat" that collided with a charter bus killing five international students in September 2015, has agreed to pay a fine of up to $1 million, the U.S. Transportation Department said on Tuesday.

Ride the Ducks International LLC (RTDI) also admitted it failed to comply with U.S. vehicle manufacturing rules because it had not registered with the government and agreed to follow rules governing safety related defects in future.

The National Transportation Safety Board in November blamed the crash on a front axle failure caused by a manufacturing error.


The collision increased scrutiny of the boat-buses, which have been involved in several deadly crashes. Four months earlier, an amphibious sightseeing vehicle in Philadelphia fatally struck a woman on a street. In 2010, two tourists were killed when a tugboat pushed a barge into a similar vehicle in Philadelphia. In April this year, a Boston Duck Tours bus struck and killed a woman in Boston.

National Highway Traffic Safety Administration chief Mark Rosekind said in a statement that the settlement "sends an important message that NHTSA will continue exercising its authority to protect the public’s safety with all vehicle manufacturers."

RTDI must obtain an outside consultant to advise the company on their legal responsibilities and to bring it into compliance with the requirements of auto safety law, according to the agreement. RTDI will pay $480,000 in civil penalties and spend $20,000 to ensure completion of the terms of the settlement. The company will owe up to $500,000 more for further violations.

RTDI issued a service bulletin in 2013 to address axle issues, but never issued a recall. The students killed in the Seattle crash were from Austria, Indonesia, Japan and China.

The company acknowledged in a statement that it "fell short of some federal standards required by NHTSA which were unknown to us at the time. We have worked collaboratively with NHTSA to understand their requirements and to improve these communications going forward."

The NTSB also faulted the tour company, Ride the Ducks of Seattle, for not ensuring proper maintenance. In May, state regulators fined the tour company $308,000.

In January, Ride the Ducks of Seattle resumed operation after agreeing to use new street routes and add a second staff member to each tour.

(Reporting by David Shepardson; Editing by Alan Crosby and Grant McCool)

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