FMC Bonds

Companies located in the United States can be licensed and required to provide the $50,000 Freight Forwarder and/or $75,000 NVOCC bond.  ONLY companies located outside of the United States will obtain the $150,000 Foreign NVOCC bond.  The FMC will not accept the $150,000 Foreign NVOCC bond from a Domestic company.

Domestic OTI’s applying for the $50,000 Freight Forwarder and $75,000 NVOCC bonds should be licensed before getting a bond.  There is no advantage to getting the bond before being licensed and able to operate, and you should coordinate directly with the FMC or a company that specializes in assisting with the licensing process, but International Sureties does not provide those services.

NVOCCs wishing to serve in the U.S.-China trade may file Optional Rider for Additional NVOCC Financial Responsibility, to meet the Chinese government’s financial responsibility requirements. This rider adds an additional $50,000 to the NVOCC bond to make their bonded total $125,000. The rider amount is available to pay fines and penalties for activities in the U.S.-China trades imposed by the Chinese government. This rider is accepted as a convenience to U.S. NVOCCs and any questions about the NVOCC requirements of the Chinese government should be directed to that government. The Optional Rider for Additional NVOCC Financial Responsibility is filed by rider to Form FMC-48 or Form FMC-69. If the underlying bond is cancelled, the rider is cancelled with the bond. The rider may be cancelled independent of the bond.

The bond ensures the OTI will faithfully perform its duties and manage funds, and is open to claims from any and all persons, including the FMC itself, for damages arising out of its ocean-transportation related activities.  More specifically, the bond protects “any and all persons who have obtained a judgment or a settlement made pursuant to a claim under 46 CFR § 515.23 for damages against the Principal arising from its transportation-related activities or order of reparation issued pursuant to section 11 of the Shipping Act, and the Federal Maritime Commission for any penalty assessed against the Principal pursuant to section 13 of the Shipping Act.”