Each OTI and each NVOCC based outside the USA must submit proof of financial responsibility to the FMC in form of a OTI Bond: (PDF) before its license is issued and first tariff is published. CFR-46, Part 515 provides full details of these requirements. Most OTIs and NVOCCs meet this requirement through the filing of a government surety bond by a qualified surety, or through participation in a group bond. If you are applying for the OTI license to operate as both an NVOCC and as an ocean freight forwarder two separate bonds are required. FMC bonding requirements as of May 1, 1999 are as follows:

• OTI-Ocean Freight Forwarders:   US $50,000 plus US $10,000 per U.S. branch office.
• OTI-NVOCCs:   US $75,000 plus US $10,000 per U.S. branch office.
• NVOCCs outside the USA:   US $150,000 without any branch office bonding requirement.

We are not insurance agents. We provide the FMC's required document, Form FMC-48, as a convenience, but your insurer must complete it. Each bond must be signed by qualified insurer and by an officer of your company. Here at DPI we need a copy of your bond for our record keeping, and to attach it to your OTI license application, or registration for an FMC organization number. Also, complete bond information must be referenced in rule no. 24 of your FMC tariff. Any change to an NVOCC bond must be reflected in the tariff.

Bonding Resources

We are often asked to recommend an insurance agent or surety who is qualified to handle the FMC bonding requirements. We recommend you contact Avalon Risk Management, Inc. or Roanoke Trade Services, Inc. who maintain offices in key US cities, and a worldwide network of agents. If your organization is based in Asia, we recommend you contact Mr. Caesar Tsui, of Risk Management Insurance Brokerage (RMIB), in Hong Kong.

One of the best values for bonding available is Avalon's "FIATA Group Bond." This unique programme enables FIATA members and affiliate members to obtain FMC bonding at the lowest possible cost. Roanoke Trade and RMIB also offer similar bonding for FIATA affiliates.

For more information on FIATA, we suggest you view their web site. In the USA, affiliate membership is extended to members of the  Transport Intermediaries Association (TIA). A complete list of national associations affiliated with FIATA including complete contact information is available at the FIATA web site.