Summary of Proposed Federal Rules for Freight Brokers

Motor Carrier Protection Act of 2010
Summary of Major Provisions, excerpted from the web site of Senator Olympia Snowe

  • Increases the broker bond from $10,000 to $100,000 and applies the bonding requirement to freight forwarders.
  • Establishes stricter requirements for entities seeking broker/forwarder authority as well as specific guidelines from FMCSA’s review of authority applicants and applications.
  • Establishes strict penalties for violations including unlimited liability for freight charges for brokerage activities without a license or bond. Authorizes private damages remedies against companies who violate FMCSA regulations.
  • Establishes an annual registration requirement to renew broker/forwarder operating authority and generate revenue for FMCSA enforcement. Requires FMCSA to revoke operating authority that is not renewed annually.
  • Establishes strict regulations on bond providers and the manner in which bonds are administered.
  • Clarifies that motor carriers must have a broker’s or forwarder’s license and bond to put freight on another carrier for compensation.
  • Requires separate registration numbers per authority, and that whatever authority is used in a transaction must be stated in writing.

Note: Both the Transportation Intermediaries Association (TIA) and the Owner-Operators and Independent Drivers Association (OOIDA) have expressed support for the proposed legislation, according to an article that appeared in the Journal of Commerce on June 17, 2010.

Peggy Dorf

Peggy joined DAT in 2008 as a writer and market analyst. She was instrumental in developing DAT Trendlines, and she writes extensively about the impact of economic trends on companies and individuals in transportation and logistics. Peggy is a Certified Transportation Broker with decades of experience in technology marketing and an MBA from the Wharton School.