The Federal Motor Carrier Safety Administration (FMCSA) has announced a proposal to push back the enforcement date of its broker financial security requirements to 2026.
This proposed rulemaking, which recently appeared in the Federal Register, suggests extending the compliance deadline from January 16, 2025, to January 16, 2026. The extension aims to coincide with the anticipated readiness of FMCSA’s updated registration system.
“This action is being proposed because FMCSA has determined that only its forthcoming online registration system will be used to accept filings and track notifications, and this functionality will not be added to its legacy systems,” the agency wrote in the notice. “As the new system is not expected to be available before Jan. 16, 2025, FMCSA proposed to extend the compliance date to provide regulated entities time to begin using and familiarizing themselves with the system before compliance is required.”
Overview of the Rule
The finalized regulations concerning broker and freight forwarder financial security were released by FMCSA in November 2023. These regulations aim to tighten security measures within the brokerage industry, notably suspending operating authority if financial security dips under $75,000.
Key aspects of the rule include:
- Restricting the types of assets that can be held in broker or freight forwarder trusts to cash, treasury bonds, and irrevocable letters of credit from federally insured institutions.
- Outlining the procedures for the immediate suspension of broker or freight forwarder operational authority should their financial security fall below the $75,000 threshold.
- Defining criteria for financial failure or insolvency among brokers and freight forwarders, and specifying the resultant obligations.
- Revising FMCSA regulations to introduce civil penalties for violations by sureties and trust funds, and establishing a suspension process for non-compliance.
Originally, brokers, sureties, and financial service providers were expected to adhere to these suspension protocols starting January 16, 2025, with additional rule components slated for 2026 implementation. The FMCSA now proposes a one-year deferment of the suspension rules.
Participating in the Commentary Process
Following publication in the Federal Register, there will be a 15-day window for public comments on the proposed delay. Interested parties can submit their feedback by visiting Regulations.gov and entering the docket number FMCSA-2024-0280.
Source: Land Line
