canadian freight brokers
- Thread starter Jaydee
- Start date
30
If a Canadian freight broker engages in cross border freight shipments between Canada and the US, or engages in inter state freight shipments within the US, they must be registered with FMCSA. Where they have their business registered does not have any bearing on the requirement to register with FMCSA. No, it is not optional, however enforcement is non existent and many Canadian freight brokers ignore the requirement. Dealing with such a non compliant broker however, negates a carrier’s ability to claim against the brokers surety bond, which is a mandatory provision of FMCSA registration..
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I find this ironic... after claiming on a bond for the first time, I heard back the following:
"Both loads were picked up in Michigan and delivered to a location in Canada, thus making it an international load. Per Title 49 USC §13501, international freight is outside the jurisdiction of the FMCSA and not covered by the surety bond. This claim is denied upon those grounds."
So to confirm, a surety bond is REQUIRED to broker U.S. to Canada shipments, but carriers of such shipments CANNOT claim against a surety bond. Thanks FMCSA!
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Receiving an initial negative response from any insurance company seems to be their standard procedure unfortunately. However I am sure with the right amount of persuation a different outcome is entirely possible. There are many carriers on this site who have been successful in claiming against a brokers surety bond.
So, Title 49 USC13501 states (as per Cornell Law School, https://www.law.cornell.edu/uscode/text/49/13501) the below snippet.
The sticky one is letter (E) where it says, 'to the extent the transportation is in the United States'.
It's quite a stretch for the surety to claim that line negates the requirement to pay under the FMCSA brokerage authority because at some point it is not in the US.
However, I have had a surety claim that freight originating in another foreign country with a destination to the US is not under the jurisdiction of the 'Secretary and the Board' and is not valid. This is the exact opposite of (E) and since it is specifically mentioned the one way but not the other it can be interpreted that only freight originating in the US is applicable.
We need a lawyer to challenge it or get a ruling.
The sticky one is letter (E) where it says, 'to the extent the transportation is in the United States'.
It's quite a stretch for the surety to claim that line negates the requirement to pay under the FMCSA brokerage authority because at some point it is not in the US.
However, I have had a surety claim that freight originating in another foreign country with a destination to the US is not under the jurisdiction of the 'Secretary and the Board' and is not valid. This is the exact opposite of (E) and since it is specifically mentioned the one way but not the other it can be interpreted that only freight originating in the US is applicable.
We need a lawyer to challenge it or get a ruling.
30
That 75k bond has another issue now gee sure glad we are all protected by it. Feeling all warm and fuzzy on this ice pellets and rainy day knowing we have 75K to split among us all if a broker goes down for 2-3 million.. Give it teeth or get rid of it.. Won't even by a new pick up but we are supposed to be secure because a broker has it. LMAO. Sorry your getting your chain yanked but really not shocked by it.
