...
Question 1: What is the minimum level of financial security that a broker or freight forwarder must maintain on file with FMCSA?
Guidance: Beginning October 1, 2013, all FMCSA regulated brokers and freight forwarders must obtain and file with FMCSA a surety bond or trust fund agreement in the amount of $75,000.
Question 2: If my surety bonding company or trustee previously filed Forms BMC-84 or BMC-85, do I need to file a new one reflecting the new $75,000 minimum financial security requirement?
Guidance: Yes. All brokers and freight forwarders subject to FMCSA jurisdiction must file new BMC-84 or BMC-85 forms reflecting the new minimum financial security amount of $75,000 as of October 1, 2013. FMCSA will develop new BMC forms for use by surety bonding companies and trust fund institutions in advance of the October 1, 2013, deadline.
Question 3: My company has both broker and freight forwarder authority. Is one $75,000 bond or trust fund sufficient or do I need 2 separate bonds/trust funds?
Guidance: One $75,000 bond or trust fund is sufficient as long as the legal entity holding the authorities is the same. Your company will need to file separate BMC-84/BMC-85 forms for the broker and freight forwarder operations. However, the underlying bond or trust fund can be the same for both operations. If your broker and freight forwarder operations are conducted under separate but affiliated companies, each entity must have a separate bond or trust fund.
Question 4: Will existing surety bonds be cancelled and replaced by the new surety bonds? Alternatively, will the existing surety bonds remain in place and be revised by rider or endorsement?
Guidance: Pursuant to 49 CFR 387.307(a), a surety bond “for the full limits of liability prescribed” must be in effect before FMCSA will issue property broker or household goods broker operating authority. Riders/endorsements are a permissible means of complying with the new $75,000 financial responsibility requirement, provided that a new BMC-84 form for the full limits of liability is on file with FMCSA.
Question 5: May I use group surety bonds or trust funds to satisfy FMCSA's financial responsibility requirement?
Guidance: No. Although FMCSA is authorized, pursuant to 49 U.S.C. 13906(b) and (c), to accept group financial security products to meet property broker and freight forwarder financial responsibility requirements on the condition that those products otherwise meet the requirements set forth in 49 U.S.C. 13906 and 49 CFR part 387, the Agency is not required to accept these group financial security products. At this time, FMCSA is considering the enforcement implications of group sureties as well as the effect on small entities and new entrants. FMCSA is committed to reexamining this issue as part of its enforcement phase-in plan described under section C, FMCSA Implementation and Enforcement Timelines, below.