FMCSA BROKER AND FREIGHT FORWARDER PROPOSED RULEMAKING
February 17, 2023
On January 5, 2023, DOT’s Federal Motor Carrier Safety Administration (“FMCSA”) issued a proposed rulemaking seeking to address the issue of brokers and sureties who fail to timely pay claims brought by motor carriers and freight forwarders. FMCSA is proposing regulations in five areas including (1) assets readily available, meaning brokers/freight forwarders would be required to maintain trusts with at least $75,000 in assets; (2) immediate suspension of broker/freight forwarder’s operating authority, meaning whenever the assets in a trust fall below $75,000, FMCSA would issue a notice to the trust/surety to replenish funds in the account within seven days or face possible suspension; (3) surety/trust responsibility for financial failure or insolvency, under which the insolvency would be published and the surety/trust named on behalf of the broker/forwarder would be notified to initiate an immediate cancelation of financial responsibility; (4) enforcement authorization, under which FMCSA would provide notice of a suspension and provide 30 days for the broker/forwarder to respond, after which a final agency decision would be issued; and (5) entities available to provide trust funds, under which loan and finance companies would no longer be permitted to act as sureties or trustees.
FMCSA is seeking comment on the proposed rulemaking until March 6, 2023.
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com 202-659-6622) or Drew Derco (dderco@eckertseamans.com 202-659-6665).
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