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Thanks for the information here. Insurance company has the bond but doesn't insist I get one. Good cash grab.
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Compliance with US Rules for Load Brokers
- Thread starter loaders
- Start date
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Not quite sure what you mean by, "insurance company has the bond but doesn't insist I get one". The insurance company, provided they are versed in transportation, will know exactly what you require. It is not up to the insurance company to "insist" that you get a bond, that is the role of the FMCSA. In regards to it being a cash grab, I think of it this way, I have never had a fire in my home, nor do I expect to have one, however I do still purchase fire insurance every year. Again, a thorough read of the regulations will show that if you engage in the arranging of interstate transportation on vehicles other than your own, you need a property brokers registration, or MC#. Interstate transportation is any traffic that originates in one state and travels to another, including that which might for a portion of the trip, travel through a foreign country. Also including traffic that originates or terminates in a foreign country.
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In order to get an MC#, you have to have your $75k surety bond. With out that MC#, you'll never get anything hauled in the US, from the US or to the US. No US company or factoring company will allow business with you without that MC# and most Canadian carriers loading to go to or from the US will ask for your MC# as well.
It's not a cash grab, it's meant to stop the fly-by-night brokers who open their doors, grab the money and run and then do it again 6 months later.
It's not a cash grab, it's meant to stop the fly-by-night brokers who open their doors, grab the money and run and then do it again 6 months later.
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I do wonder if the open up, collect and close up shop was a larger issue south of the border than here (Canada) based on the paranoia. We do so little domestic US business that we just pay by credit card (that certainly is never refused).
I haven't had one Canadian carrier ask for our Surety Bond information. Maybe they worry I'll ask for theirs if they are doing any furtherance provider work, etc.
Keep well,
Mike
side note - remember those who have less than you, visit your local food bank before Easter. We used to have everyone bring in food but now we all just give cash, the food bank gets better deals than people do and can buy way more with the same money than we can.
I haven't had one Canadian carrier ask for our Surety Bond information. Maybe they worry I'll ask for theirs if they are doing any furtherance provider work, etc.
Keep well,
Mike
side note - remember those who have less than you, visit your local food bank before Easter. We used to have everyone bring in food but now we all just give cash, the food bank gets better deals than people do and can buy way more with the same money than we can.
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I have had quite a few Canadian carriers ask me. It's not every Can/US shipment but a fair amount. I find it mostly happens in ON and BC, everywhere else people don't really seem to care. We have it on our credit sheet now so nobody has to even ask though.
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We do the same JRod. People you have been dealing with for years and have established a record of payment with, may not ask, but when dealing with a new supplier, I find it demonstrates your commitment to your chosen profession and your adherence to the standards and rules of the industry.
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The Federal Motor Carrier Safety Administration will publish a notice in the Federal Register March 31, 2015, denying a request for exemption from the $75,000 minimum bond requirement now in place for freight-forwarders and brokers. The request, from the Association of Independent Property Brokers and Agents, sought an exemption for the entire universe of forwarders and brokers, not a single broker.
While FMCSA concluded it did not have the authority to grant such a wide exemption (a claim AIPBA disputes), the agency also went on to note that exempting brokers and forwarders from the bond requirement would, “most critically,” the agency wrote, not be “in the public interest” and thus outside the bounds of appropriate action.
Related
Another take on broker bond increase: TIA says impact on brokers, industry will be minimal
The dropping numbers of brokers in FMCSA's database doesn't tell the whole story, says a TIA rep, and the impact of the broker bond increase ...
In essence, FMCSA agreed with arguments in commentary against the exemption put forward by the Owner-Operator Independent Drivers Association, the Transportation Intermediaries Association and others. “Granting an exemption to all brokers and freight forwarders would flout a clear and recent congressional directive and statement of the public interest,” the agency noted.
Related
Broker group continues push against bond increase, files for exemption for all brokers
AIPBA has filed an application with FMCSA asking it to exempt all brokers from the increase. The group has also been fighting the bond increase ...
OOIDA’s commentary on the exemption application argued in favor of the status quo on the $75,000 bond on grounds not only of its need to discourage fraudulent middlemen from operating in the freight marketplace but of the benefits it provides to the efficiency of the freight marketplace. “Part of the efficiency of the current transportation marketplace is that brokers match motor carriers available to haul freight and shippers needing to move freight,” OOIDA wrote in its comments of the “parties who do not have an ongoing relationship, but who might make mutually beneficial connections on a load-by-load basis. This efficiency in the marketplace is increased greatly when motor carriers feel comfortable taking loads from brokers who they do [not] know.”
Related
Beefing Up the Bond
Small brokers oppose proposed regs to increase the minimum bond to $100,000 and add other owner-operator protection.
James Lamb, president of the AIPBA business league, noted his fight against the broker bond’s rise, from $10,000 to $75,000 with the MAP-21 highway bill in 2012, would duly continue. “We have faith in the judicial system and are confident that justice will ultimately be served,” he noted in a statement responding to the denial.
Two federal court proceedings challenging the bond, he explained, would now move forward, “albeit very slowly, through the federal courts.”
While FMCSA concluded it did not have the authority to grant such a wide exemption (a claim AIPBA disputes), the agency also went on to note that exempting brokers and forwarders from the bond requirement would, “most critically,” the agency wrote, not be “in the public interest” and thus outside the bounds of appropriate action.
Related
Another take on broker bond increase: TIA says impact on brokers, industry will be minimal
The dropping numbers of brokers in FMCSA's database doesn't tell the whole story, says a TIA rep, and the impact of the broker bond increase ...
In essence, FMCSA agreed with arguments in commentary against the exemption put forward by the Owner-Operator Independent Drivers Association, the Transportation Intermediaries Association and others. “Granting an exemption to all brokers and freight forwarders would flout a clear and recent congressional directive and statement of the public interest,” the agency noted.
Related
Broker group continues push against bond increase, files for exemption for all brokers
AIPBA has filed an application with FMCSA asking it to exempt all brokers from the increase. The group has also been fighting the bond increase ...
OOIDA’s commentary on the exemption application argued in favor of the status quo on the $75,000 bond on grounds not only of its need to discourage fraudulent middlemen from operating in the freight marketplace but of the benefits it provides to the efficiency of the freight marketplace. “Part of the efficiency of the current transportation marketplace is that brokers match motor carriers available to haul freight and shippers needing to move freight,” OOIDA wrote in its comments of the “parties who do not have an ongoing relationship, but who might make mutually beneficial connections on a load-by-load basis. This efficiency in the marketplace is increased greatly when motor carriers feel comfortable taking loads from brokers who they do [not] know.”
Related
Beefing Up the Bond
Small brokers oppose proposed regs to increase the minimum bond to $100,000 and add other owner-operator protection.
James Lamb, president of the AIPBA business league, noted his fight against the broker bond’s rise, from $10,000 to $75,000 with the MAP-21 highway bill in 2012, would duly continue. “We have faith in the judicial system and are confident that justice will ultimately be served,” he noted in a statement responding to the denial.
Two federal court proceedings challenging the bond, he explained, would now move forward, “albeit very slowly, through the federal courts.”
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Another increase? I honestly hope that this doesn't go through. It's not quite the $65k jump we had last time but for us smaller brokers, getting that $75k was hard enough. We actually abide by the rules but without physical assets like a fully owned office or some sort of fleet, showing finances to cover the the required assets is difficult.
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No, they have a special provision for brokers.. says so on the form.. for freight brokers with zero trucks the fee is $75.00US this year. On the form it specifically asks if you're a freight broker and if you answer yes you skip to the last part of the form and pay. If not paying on line they recommend certain states like MI and IN where Canadian brokers can remit their payment.
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The penalty is $10 000 PER ORDER tendered.
https://www.gpo.gov/fdsys/pkg/PLAW-112publ141/pdf/PLAW-112publ141.pdf
It's on page 378.
I'll hold my comments on where laws are applicable as that topic has been beaten to death around here.
Happy Friday,
Mike
https://www.gpo.gov/fdsys/pkg/PLAW-112publ141/pdf/PLAW-112publ141.pdf
It's on page 378.
I'll hold my comments on where laws are applicable as that topic has been beaten to death around here.
Happy Friday,
Mike