We Give Up!
California Delays Part of CTC Program Again
The Federal Motor Carrier Safety Administration (FMCSA) has issued a Notice of Proposed Rulemaking (NPRM) to change the financial responsibility requirements of brokers and freight forwarders. The changes are intended to benefit motor carriers.
Federal law requires brokers and freight forwarders to maintain “assets readily available” in the amount of $75,000 to meet obligations to motor carriers. Brokers and freight forwarders often meet the financial security requirement through surety bonds or trust funds administered by others, termed “financial responsibility providers.”
When a broker or freight forwarder improperly withholds payment for services from a motor carrier, the trucking company can submit claims to the financial responsibility provider backing the surety or trust fund. If the total claims from all carriers exceed the $75,000 figure, the financial responsibility provider may seek assistance from a court in an interpleader action. The court would decide share of the $75,000 each claimant receives.
FMCSA states that the percentage of unscrupulous brokers is small but acknowledges that procedures for recovering damages from such brokers are slow and tedious. To minimize claims and expedite the process, the NPRM would:
The NPRM would allow three years for brokers, freight forwarders and their financial backers to make the proposed changes. Make comments on the NPRM, due by March 6, 2023.
California Delays Part of CTC Program Again
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