On September 5, the Federal Motor Carrier Safety Administration (FMCSA) issued a notice regarding the enforcement of certain provisions of the Moving Ahead for Progress in the 21st Century Act (MAP-21).
One of the provisions of MAP-21 requires that all freight brokers and freight forwarders have a $75,000 surety bond or trust fund by Oct. 1, 2013. This is an increase from the current requirement of $10,000. Regarding enforcement of this provision, the agency announced:
FMCSA will be providing a 60-day phase-in period beginning October 1, 2013, to allow the industry to complete all necessary filings. Beginning November 1, 2013, FMCSA will mail notifications to all brokers and freight forwarders that have not met the $75,000 minimum financial security requirement. FMCSA will provide 30 days advance notice before revoking the freight forwarder and broker operating authority registrations.
Posting on DAT Load Boards
Although the FMCSA will phase in enforcement of the $75,000 bond/trust, it’s still important for brokers to secure the bond and maintain their operating authority. Surety bond providers may experience a surge in the coming weeks, so you don’t want to wait until the last minute.
It has always been DAT’s policy that brokers must have operating authority from the FMCSA in order to post loads on our load boards. That policy will remain unchanged. Maintaining your operating authority will allow you to continue to post loads on our system.
Bond for DAT customers
If you have not yet obtained a $75,000 bond, we can help. Recently we enlisted the assistance of a very reputable surety bond provider, Integro Insurance Brokers, to offer a special surety bond for DAT customers. For customers who qualify, Integro is offering a very competitive premium, with rates starting as low as $3,000. No collateral or financial statements are required.
With this bond, there are no program initiation fees and DAT does not receive any compensation for promoting this program. It is, however, a way we can keep our customers compliant while offering an A-rated bond with minimal documentation required. For more information, visit DAT.com/bonds, which links you to the Integro application.
Motor carriers who broker loads
Another provision of MAP-21 requires motor carriers that occasionally broker loads to obtain operating authority as brokers from the FMCSA. Regarding this provision, the agency says:
FMCSA will phase in its enforcement of the broker registration requirements for motor carriers that also broker loads. During the first phase-in period, FMCSA will accept complaints regarding unregistered brokerage activities of motor carriers through our National Consumer Complaint Database. FMCSA will work with industry groups to use this complaint information and other data to ascertain the extent of the unlicensed broker population subset within the motor carrier industry. The agency will then work toward developing a comprehensive enforcement program.
The FMCSA concludes its notice with a message to carriers:
FMCSA strongly encourages all motor carriers not to accept loads from unregistered brokers or freight forwarders, as these entities might not have the financial security mandated by MAP-21. FMCSA also notes that motor carriers brokering loads without properly registering with FMCSA as brokers may be subject to private civil actions pursuant to 49 U.S.C. 14707.
For more information, you can read the complete text of the FMCSA notice, which includes a good question-and-answer section about both the registration and bond requirements.