Making sure that brokers are compliant with financial responsibility requirements and have some skin in the game is something OOIDA supports. The Federal Motor Carrier Safety Administration delaying the deadline to comply with the new final rule gives the Association pause.
The Owner-Operator Independent Drivers Association represents more than 150,000 members in all 50 states – making it the largest trade association supporting small-business truckers and professional truck drivers. The relationship between trucking and brokers is something OOIDA is very familiar with and has tried to change for years.
FMCSA issued the final rule regarding broker and freight forwarder financial responsibility in November 2023. The rule takes several steps to improve broker security regulations, including the suspension of operating authority if the available financial security falls below $75,000.
Specifically, the rule aims to:
- Limit the asset types that can be maintained in broker or freight forwarder trusts to cash, treasury bonds and irrevocable letters of credit issued by a federally insured depository institution
- Establish procedures and requirements for the immediate suspension of broker and freight forwarder operating authority registration if the available financial security falls below $75,000
- Clarify when a broker or freight forwarder is in financial failure or insolvency and establish related requirements
- Amend FMCSA regulations to add civil penalties for surety and trust fund violations of the regulations and to establish a process for the suspension of sureties and trusts in the event of noncompliance with the regulations
FMCSA proposed delaying the compliance date of its broker financial responsibility rule until 2026.
In a notice of proposed rulemaking that published in the Federal Register on Nov. 4, the agency said it plans to move the compliance date from Jan. 16, 2025 to Jan. 16, 2026, when its new registration system may be ready.
OOIDA disagrees
In comments filed by OOIDA on Tuesday, Nov. 19, the Association made it clear a delay is unacceptable.
“We alerted FMCSA nearly a year ago that ‘the Unified Registration System remains a work in progress and there have been numerous problems with URS rollout historically.’ We mentioned skepticism about the final rule providing sufficient time to complete the URS rulemaking process before the January 2025 compliance date for the Immediate Suspension of Broker/Freight Forwarder Operating Authority provision. We are disappointed these warnings proved accurate,” the comments state.
They go on to say: “Delaying this aspect of the rulemaking will allow brokers to continue stealing transportation services in excess of the bond amount. This is simply unacceptable, as freight fraud remains commonplace within the industry.”
FMCSA blames the need for the proposed delay on the updating of the Federal Registration System. OOIDA isn’t holding out much hope that the necessary updates to that system will happen in time for the 2026 proposed compliance deadline.
“There are no assurances that the updated Federal Registration System (FRS) will be completed by the newly proposed Jan.16, 2026 compliance date. We acknowledge that significant progress has been made on the FRS over the past year and that the system will potentially reduce rampant freight fraud. However, the agency has only provided a general 2025 timeframe for rolling out the new registration system in phases,” the comments state.
Find another way
Rather than sit around and wait for systems to come online, OOIDA is pressing the agency for a workaround.
The Association’s comments outline possible temporary and/or alternative ways to implement the following provisions of the Broker and Freight Forwarder Financial Responsibility Final Rule beginning in January 2025 as intended:
- Immediate suspension of broker/freight forwarder operating authority. When a broker or freight forwarder’s available financial security falls below $75,000, FMCSA shall suspend its operating authority registration.
- Surety or trust responsibilities in cases of broker/freight forwarder financial failure or insolvency. If a surety/trustee becomes aware that a broker or freight forwarder is experiencing financial failure or insolvency, it must notify FMCSA and initiate cancellation of the financial responsibility.
- Enforcement authority and penalties for financial responsibility providers who do not comply with the regulations.
“Congress enacted these policies over 12 years ago, establishing new financial security requirements and oversight for brokers/freight forwarders. The agency should not waste any more time before they are put into practice,” the comments state.
More time to comment
FMCSA also announced that it would tack on an additional week to the original comment period on the proposed compliance delay. Click here to comment. LL
Senior Editor Mark Schremmer contributed to this report.
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