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FMC Bond

(Federal Maritime Commission Bond)

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A Freight Forwarder is engaged in the business of dispatching shipments on behalf of others, in order to facilitate shipment by a common carrier. Freight Forwarders commonly handle most of the freight arrangements on behalf of their shipping customers. Freight Forwarders generally charge fees for the services performed on behalf of their customers.

The Ocean Shipping Reform Act of 1998 requires all OTI's to provide proof of financial responsibility to secure their obligations to the Federal Maritime Commission as well as to third parties for their transportation related activities as an OTI. The most common instrument of financial responsibility is a surety bond. The FMC Form 48 is posted in the amount of $50,000 for Freight Forwarders. Freight Forwarders can have additional branch offices added to their bond. Each additional branch or location will require the bond amount to be increased in $10,000 increments.

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