What is an Iowa Federal Maritime Commission Bond?
This licensure requirement is a proof of financial responsibility that every licensed or license applicant Ocean Transportation Intermediaries (OTI) such as an Ocean Freight Forwarder (OFF) or a Non-Vessel-Operating Common Carrier (NVOCC) needs to submit.
The surety bond is mandated by the Federal Maritime Commission, in line with The Shipping Act of 1984.
An Ocean Freight Forwarder (OFF) is an individual that manages freight shipments imported to the U.S; dispatches shipments from the U.S. to international destinations via an ocean carrier; and tracks the movement of a shipment and prepares the documentation.
A Non-Vessel-Operating Common Carrier (NVOCC), on the other hand, is a common carrier that does not own or operate its own vessels. An NVOCC is also a shipper in its relationship with an ocean common carrier involved in cargo movement.
What is the Iowa Federal Maritime Commission Bond amount?
Individual OTI Bond Amount
$50,000 – Ocean Freight Forwarder (OFF)
$75,000 – an individual operating in the U.S. as a Non-Vessel-Operating Common Carrier (NVOCC)
$150,000 – registered NVOCC whose primary place of business is outside the U.S.
Group OTI Bond Amount
For group Ocean Transportation Intermediaries, the surety bond amount will be up to $3,000,000. In addition, each group shall:
- Notify the Commission and provide documentation of its desire to participate
- Provide a list that contains each member of the group, the corresponding surety bond, and that claims will be permitted for each.
- Provide a copy of the financial responsibility coverage to the Commission.
Individuals under the same common trade name should furnish a surety bond separately.
Federal military and civilian household goods require different surety bonds.
An additional $21,000 should be added to the bond amount for Optional Rider for Additional NVOCC Financial Responsibility. These are the NVOCCs who intend to be included in the U.S.-China trade.
The Office of Passenger Vessels and Information Processing (OPVIP) will be the one responsible for reviewing and processing the submitted surety bond.
What are the surety bond conditions?
- The bond should be issued by a surety bond company that is recognized by the U.S. Department of Treasury such as Surety Bond Authority
- The principal shall comply with the provisions of the Shipping Act of 1984, the Coast Guard Authorization Act of 1998, and all other applicable rules.
- The principal shall pay for any valid claims resulting from the principal’s transportation-related activity misconduct.
- The bond will remain valid until canceled. In the case of cancellation, a 30-day notice is required.
How do I get this type of bond?
First, you must submit a bond application.
We will ask you a couple of important information needed for the underwriting process such as your financial history, job performance history, and credit score.
After those were evaluated, we will issue the bond and send it to you right away.
Need more information? CALL us today!