II 

111TH CONGRESS 

2D SESSION S. 3483 

To amend section 139 of title 49, United States Code, to increase the 

effectiveness of Federal oversight of motor carriers, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JUNE 14, 2010 

Ms. SNOWE (for herself and Ms. KLOBUCHAR) introduced the following bill; 

which was read twice and referred to the Committee on Commerce, 

Science, and Transportation 

A BILL 

To amend section 139 of title 49, United States Code, to 

increase the effectiveness of Federal oversight of motor 

carriers, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Motor Carrier Protec5 tion Act of 2010’’. 

6 SEC. 2. REGISTRATION REQUIREMENTS. 

7 (a) IN GENERAL.— 


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1 (1) ANNUAL REGISTRATION FEE.—Each freight 

2 forwarder or freight broker that registers under 

3 chapter 139 of title 49, United States Code, shall— 

4 (A) pay an annual registration renewal fee 

5 in an amount to be determined by the Sec6 retary; 

7 (B) provide updated information for each 

8 registration; and 

9 (C) submit proof that the registrant is in 

10 compliance with the applicable surety and in11 surance requirements under such chapter 139. 

12 (2) USE OF FEES.—All new fees collected by 

13 the Secretary as a result of the new licensing re14 quirements under this Act and the amendments 

15 made by this Act shall be used to administer and en16 force the registration and related requirements 

17 under chapter 139 of title 49, United States Code. 

18 (3) CONSEQUENCE OF NONCOMPLIANCE.—Not 

19 later than 30 days after the date on which a broker, 

20 freight forwarder, or motor carrier fails to comply 

21 with this subsection, such entity shall be listed as in22 active on all relevant Department of Transportation 

23 Internet websites. 

24 (b) AMENDMENTS.—Section 13901 of title 49, 

25 United States Code, is amended— 


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1 (1) by striking ‘‘A person’’ and inserting the 

2 following: 

3 ‘‘(a) IN GENERAL.—A person’’; and 

4 (2) by adding at the end the following: 

5 ‘‘(b) REGISTRATION NUMBERS.— 

6 ‘‘(1) IN GENERAL.—If the Administrator of the 

7 Federal Motor Carrier Administration registers a 

8 person under this chapter for 1 or more activities or 

9 services, including motor carrier, freight forwarder, 

10 or broker activities or services, the Administrator 

11 shall issue a distinctive registration number to the 

12 person for each such activity or service for which the 

13 person is registered. 

14 ‘‘(2) ACTIVITY OR SERVICE TYPE INDICATOR.— 

15 Each number issued under paragraph (1) shall in16 clude an indicator of the type of activity or service 

17 for which the registration number is issued, includ18 ing whether the registration number is issued for 

19 registration of a motor carrier, freight forwarder, or 

20 broker activity or service. 

21 ‘‘(c) AUTHORITY.—For each shipment for which a 

22 registered person seeks compensation, the registered per23 son shall specify, in writing, the operating authority under 

24 which it is providing the services required.’’. 


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1 SEC. 3. REGISTRATION OF MOTOR CARRIERS. 

2 Section 13902 of title 49, United States Code, is 

3 amended— 

4 (1) in subsection (a)— 

5 (A) in paragraph (1), by inserting ‘‘using 

6 vehicles the motor carrier owns or leases’’ after 

7 ‘‘motor carrier’’; and 

8 (B) by adding at the end the following: 

9 ‘‘(6) SEPARATE REGISTRATION REQUIRED.—A 

10 motor carrier may not broker transportation services 

11 unless the motor carrier has registered as a broker 

12 under this chapter.’’; and 

13 (2) in subsection (f), by adding at the end the 

14 following: 

15 ‘‘(4) INSURANCE REQUIREMENTS.—A motor 

16 carrier registered under this section shall maintain 

17 insurance for property damage required under sec18 tion 13906(a)(4) for all shipments transported 

19 under its operating authority.’’. 

20 SEC. 4. REGISTRATION AND SECURITY OF FREIGHT FOR21 WARDERS AND BROKERS. 

22 (a) IN GENERAL.— 

23 (1) AMENDMENT.—Chapter 139 of title 49, 

24 United States Code, is amended by striking sections 

25 13903 and 13904 and inserting the following: 


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1 ‘‘§ 13903. Registration of freight forwarders and bro2 kers 

3 ‘‘(a) IN GENERAL.—A person may not act as a 

4 freight forwarder by providing service subject to the juris5 diction under subchapter III of chapter 135 or as a broker 

6 unless the person holds a freight forwarder’s permit or 

7 a broker’s license, as the case may be, issued by the Fed8 eral Motor Carrier Safety Administration. 

9 ‘‘(b) ISSUANCE OF PERMIT OR LICENSE.— 

10 ‘‘(1) ELIGIBILITY REQUIREMENTS.—The Ad11 ministrator of the Federal Motor Carrier Safety Ad12 ministration shall issue a freight forwarder’s permit 

13 or broker’s license to any person that the Adminis14 tration determines— 

15 ‘‘(A) to be qualified by experience and 

16 character to act as a freight forwarder or 

17 broker, respectively; and 

18 ‘‘(B) to be fit, willing, and able to provide 

19 the service and to comply with this part and ap20 plicable regulations of the Secretary. 

21 ‘‘(2) DURATION.—The permit or license issued 

22 under paragraph (1) shall remain in effect only as 

23 long as the freight forwarder or broker is in compli24 ance with section 13904. 

25 ‘‘(c) REGISTRATION AS MOTOR CARRIER RE26 QUIRED.— 


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1 ‘‘(1) FREIGHT FORWARDERS.—A freight for2 warder may not provide transportation as a motor 

3 carrier unless the freight forwarder— 

4 ‘‘(A) has registered separately to provide 

5 transportation as a motor carrier; and 

6 ‘‘(B) has met all the requirements under 

7 this chapter applicable to motor carriers. 

8 ‘‘(2) BROKERS.—A broker may not provide 

9 transportation as a motor carrier unless the 

10 broker— 

11 ‘‘(A) has registered separately to provide 

12 transportation as a motor carrier; and 

13 ‘‘(B) has met all of the requirements under 

14 this chapter applicable to motor carriers. 

15 ‘‘(d) REGISTRATION AS FREIGHT FORWARDER OR

16 BROKER REQUIRED.—A motor carrier registered under 

17 this chapter— 

18 ‘‘(1) may only provide transportation of prop19 erty with motor vehicles owned or leased by the 

20 motor carrier; and 

21 ‘‘(2) may not arrange such transportation un22 less the motor carrier has obtained a separate 

23 freight forwarder’s permit or broker’s license under 

24 this section. 


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1 ‘‘§ 13904. Security of freight forwarders and brokers 

2 ‘‘(a) REQUIREMENTS.— 

3 ‘‘(1) IN GENERAL.—A person may not act as a 

4 freight forwarder or broker unless the person fur5 nishes a bond, proof of trust fund, or other surety, 

6 or combination of such sureties, in a form and 

7 amount, and from a provider, determined by the Ad8 ministrator of the Federal Motor Carrier Safety Ad9 ministration to be adequate to insure financial re10 sponsibility. 

11 ‘‘(2) STANDARDS.—The Administrator may au12 thorize the use of a group bond, trust fund, or other 

13 surety, or combination of such securities that meet 

14 the cash and legal requirements under section 

15 13904(d). The Administrator may not accept proof 

16 of security from any person whose surety or surety 

17 provider does not meet the standards established by 

18 the Administrator, by regulation. Bonds issued 

19 under this section may only be offered by a bonding 

20 company that has been approved by the Secretary of 

21 the Treasury. 

22 ‘‘(b) SCOPE OF FINANCIAL RESPONSIBILITY.—A 

23 bond, trust fund, or other surety obtained under this sec24 tion shall be available to pay any claim against a freight 

25 forwarder or broker arising from its failure to pay freight 


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1 charges in its contracts, agreements, or arrangements for 

2 transportation subject to regulation under this chapter— 

3 ‘‘(1) with the consent of the insured freight for4 warder or broker, subject to review by the surety 

5 company; 

6 ‘‘(2) if the claim is deemed valid by the surety 

7 company after the freight forwarder or broker has 

8 failed to respond to adequate notice to address the 

9 validity of the claim; or 

10 ‘‘(3) if the claimant made a reasonable attempt 

11 to resolve the claim under paragraphs (1) and (2), 

12 but the claim was not resolved within a reasonable 

13 period of time. 

14 ‘‘(c) FREIGHT FORWARDER INSURANCE.— 

15 ‘‘(1) IN GENERAL.—The Administrator of the 

16 Federal Motor Carrier Safety Administration may 

17 not register a person as a freight forwarder under 

18 section 13903 unless the person files with the Ad19 ministrator a bond, insurance policy, or other type 

20 of security, in accordance with the standards estab21 lished by the Administrator under this section. 

22 ‘‘(2) LIABILITY INSURANCE.—A security filed 

23 under paragraph (1) shall be sufficient to pay an 

24 amount, not to exceed the amount of the security, 

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1 warder for bodily injury to, or death of, an indi2 vidual, or loss of, or damage to, property (other than 

3 property referred to in paragraph (3)), resulting 

4 from the negligent operation, maintenance, or use of 

5 motor vehicles by, or under the direction and control 

6 of, the freight forwarder when providing transfer, 

7 collection, or delivery service under this part. 

8 ‘‘(3) CARGO INSURANCE.—The Administrator 

9 may require a registered freight forwarder to file 

10 with the Administrator a bond, insurance policy, or 

11 other type of security approved by the Secretary, 

12 that will pay an amount, not to exceed the amount 

13 of the security, for loss of, or damage to, property 

14 for which the freight forwarder provides service. 

15 ‘‘(d) ADDITIONAL REQUIREMENTS.— 

16 ‘‘(1) REISSUANCE OF LICENSES AND PER17 MITS.—Not later than 4 years after the date of the 

18 enactment of the Motor Carrier Protection Act of 

19 2010, freight forwarders and brokers shall acquire 

20 new licenses and permits from the Federal Motor 

21 Carrier Safety Administration that are subject to 

22 the terms and conditions under this subsection. Such 

23 licenses and permits shall expire 5 years after the 

24 date of issuance and may be renewed as provided 

25 under this chapter. 


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1 ‘‘(2) EXPERIENCE OR TRAINING REQUIRE2 MENT.—Each freight forwarder and broker shall em3 ploy, as an officer, an individual who— 

4 ‘‘(A) has at least 3 years of relevant expe5 rience; or 

6 ‘‘(B) provides the Administrator with satis7 factory evidence of certified training. 

8 ‘‘(3) ONLINE.—The Administrator shall make 

9 information on permits, licenses, and financial secu10 rity publicly available online, including— 

11 ‘‘(A) the names and addresses of the prin12 cipals of each entity holding a permit or license; 

13 and 

14 ‘‘(B) the electronic address of its surety 

15 for the submission of claims. 

16 ‘‘(4) MINIMUM FINANCIAL SECURITY.—Each 

17 freight forwarder and broker shall provide financial 

18 security of at least $100,000, regardless of the num19 ber of branch offices or sales agents of such entities. 

20 ‘‘(5) SPECIFIC PERFORMANCE STANDARDS.— 

21 The Administrator shall set specific performance 

22 standards for bonds or other acceptable surety, in23 cluding requirements that— 

24 ‘‘(A) at least $10,000 be deposited with 

25 the surety in cash; 


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1 ‘‘(B) the balance of the surety amount con2 sists of assets readily available to pay valid 

3 claims without resort to personal guarantees or 

4 collection of pledged accounts receivable; and 

5 ‘‘(C) the surety is ultimately financially re6 sponsible for any failure to make the required 

7 payments. 

8 ‘‘(6) NOTICE TO CANCEL.—If a surety required 

9 under this subsection is canceled— 

10 ‘‘(A) the holder of the surety shall provide 

11 electronic notification to the Administrator of 

12 such cancellation not later than 30 days before 

13 the effective date of such cancellation; and 

14 ‘‘(B) the Administrator shall immediately 

15 post such notification on its public website. 

16 ‘‘(7) SUSPENSION.—The Administrator shall 

17 immediately suspend the registration of a freight 

18 forwarder or broker if its available security falls 

19 below the amount required under this subsection. 

20 ‘‘(8) PAYMENT OF CLAIMS.—If a registered 

21 freight forwarder or broker experiences financial 

22 failure or insolvency, the freight forwarder’s or bro23 ker’s surety shall— 


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1 ‘‘(A) submit a notice to cancel the surety 

2 to the Administrator in accordance with para3 graph (6); 

4 ‘‘(B) publicly advertise for claims for 60 

5 days beginning on the date of publication by the 

6 Administrator of the notice to cancel the surety; 

7 and 

8 ‘‘(C) pay, not later than 30 days after the 

9 expiration of the 60-day period for submission 

10 of claims— 

11 ‘‘(i) all uncontested claims received 

12 during such period; or 

13 ‘‘(ii) a pro rata share of such claims 

14 if the total amount of such claims exceeds 

15 the financial security available. 

16 ‘‘(9) LIST OF CLAIMS PAID.—Each surety under 

17 this subsection shall— 

18 ‘‘(A) publish, on the surety’s website, a list 

19 of the claims paid by the surety immediately 

20 upon payment; and 

21 ‘‘(B) immediately submit a copy of such 

22 list to the Administrator. 

23 ‘‘(10) PENALTIES.— 


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1 ‘‘(A) IN GENERAL.—Any surety that fails 

2 to comply with the requirements under this sub3 section— 

4 ‘‘(i) shall be liable to the United 

5 States Government for a civil penalty in an 

6 amount not to exceed $10,000; and 

7 ‘‘(ii) shall be ineligible to offer broker 

8 and forwarder security under this chapter. 

9 ‘‘(B) WILFUL VIOLATIONS.—Any surety 

10 that knowingly and willfully violates the posting 

11 and notification requirements under this sub12 section shall be held financially liable for all 

13 valid claims submitted against the broker or 

14 forwarder involved, regardless of the amount of 

15 the security. 

16 ‘‘(11) DEDUCTION OF COSTS PROHIBITED.— 

17 The amount of the financial security required under 

18 this subsection may not be reduced by deducting at19 torney’s fees or administrative costs. 

20 ‘‘(12) AUDIT.—Claim payments by sureties 

21 shall be annually audited by a public accounting 

22 firm. The results of such audits shall be made pub23 licly available on the surety’s website.’’. 

24 (2) RULEMAKING.—Not later than 270 days 

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1 ministrator of the Federal Motor Carrier Safety Ad2 ministration shall issue regulations to enforce the re3 quirements under section 13904(d) of title 49, 

4 United States Code, as added by paragraph (1). 

5 (3) EFFECTIVE DATE.—Section 13904(d) of 

6 title 49, United States Code, as added by paragraph 

7 (1), shall take effect on the date that is 270 days 

8 after the date of the enactment of this Act. 

9 (b) CLERICAL AMENDMENTS.—The table of sections 

10 for chapter 139 of title 49, United States Code, is amend11 ed— 

12 (1) by striking the item relating to section 

13 13903 and inserting the following: 

‘‘Sec. 13903. Registration of freight forwarders and brokers.’’; 

14 and 

15 (2) by striking the item relating to section 

16 13904 and inserting the following: 

‘‘Sec. 13904. Security of freight forwarders and brokers.’’. 

17 SEC. 5. REVIEW. 

18 (a) REVIEW BY INSPECTOR GENERAL.—Not later 

19 than 15 months after the date of the enactment of this 

20 subsection, the Inspector General of the Department of 

21 Transportation shall— 

22 (1) review the regulations and enforcement 

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1 ministration under section 13904(d) of title 49, 

2 United States Code, as added by section 4(a); and 

3 (2) make any recommendations to the Secretary 

4 of Transportation that may be necessary to improve 

5 the enforcement of such regulations. 

6 (b) SECURITY AND INSURANCE AMOUNT ASSESS7 MENT.—Every 5 years, the Administrator of the Federal 

8 Motor Carrier Safety Administration shall review, with 

9 public notice and comment, the amount of the security and 

10 insurance required under section 13904 of title 49, United 

11 States Code, to determine whether such amounts are suffi12 cient to provide adequate financial security. 

13 SEC. 6. UNLAWFUL BROKERAGE ACTIVITIES. 

14 (a) IN GENERAL.—Chapter 149 of title 49, United 

15 States Code, is amended by adding at the end the fol16 lowing: 

17 ‘‘§ 14916. Unlawful brokerage activities 

18 ‘‘(a) PROHIBITED ACTIVITIES.—Any person that acts 

19 as a broker, other than a non-vessel-operating common 

20 carrier (as defined in section 40102(16) of title 46), or 

21 an ocean freight forwarder providing brokerage as part of 

22 an international through movement involving ocean trans23 portation between the United States and a foreign port, 

24 is prohibited from providing interstate brokerage services 

25 as a broker unless that person— 


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1 ‘‘(1) is registered under, and in compliance 

2 with, section 13903; and 

3 ‘‘(2) has satisfied the financial security require4 ments under section 13904. 

5 ‘‘(b) CIVIL PENALTIES AND PRIVATE CAUSE OF AC6 TION.—Any person who knowingly authorizes, consents to, 

7 or permits, directly or indirectly, either alone or in con8 junction with any other person, a violation of subsection 

9 (a) is liable— 

10 ‘‘(1) to the United States Government for a 

11 civil penalty in an amount not to exceed $10,000 for 

12 each violation; and 

13 ‘‘(2) to the injured party for all valid claims in14 curred without regard to amount. 

15 ‘‘(c) LIABLE PARTIES.—The liability for civil pen16 alties and for claims under this section for unauthorized 

17 brokering shall apply, jointly and severally— 

18 ‘‘(1) to any corporate entity or partnership in19 volved; and 

20 ‘‘(2) to the individual officers, directors, and 

21 principals of such entities.’’. 

22 (b) CLERICAL AMENDMENT.—The table of sections 

23 for chapter 149 of title 49, United States Code, is amend24 ed by adding at the end the following: 

‘‘Sec. 14916. Unlawful brokerage activities.’’. 

Æ 


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