[Code of Federal Regulations]
[Title 49, Volume 4]
[Revised as of October 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 49CFR387.307]

[Page 1066-1067]
 
                        TITLE 49--TRANSPORTATION
 
                      DEPARTMENT OF TRANSPORTATION
 
PART 387_MINIMUM LEVELS OF FINANCIAL RESPONSIBILITY FOR MOTOR 
CARRIERS--Table of Contents
 
Subpart C_Surety Bonds and Policies of Insurance for Motor Carriers and 
                            Property Brokers
 
Sec. 387.307  Property broker surety bond or trust fund.

    (a) Security. A property broker must have a surety bond or trust 
fund in effect for $10,000. The FMCSA will not issue a property broker 
license until a surety bond or trust fund for the full

[[Page 1067]]

limits of liability prescribed herein is in effect. The broker license 
shall remain valid or effective only as long as a surety bond or trust 
fund remains in effect and shall ensure the financial responsibility of 
the broker.
    (b) Evidence of Security. Evidence of a surety bond must be filed 
using the FMCSA's prescribed Form BMC 84. Evidence of a trust fund with 
a financial institution must be filed using the FMCSA's prescribed Form 
BMC 85. The surety bond or the trust fund shall ensure the financial 
responsibility of the broker by providing for payments to shippers or 
motor carriers if the broker fails to carry out its contracts, 
agreements, or arrangements for the supplying of transportation by 
authorized motor carriers.
    (c) Financial Institution--when used in this section and in forms 
prescribed under this section, where not otherwise distinctly expressed 
or manifestly incompatible with the intent thereof, shall mean--Each 
agent, agency, branch or office within the United States of any person, 
as defined by the ICC Termination Act, doing business in one or more of 
the capacities listed below:
    (1) An insured bank (as defined in section 3(h) of the Federal 
Deposit Insurance Act (12 U.S.C. 1813(h));
    (2) A commercial bank or trust company;
    (3) An agency or branch of a foreign bank in the United States;
    (4) An insured institution (as defined in section 401(a) of the 
National Housing Act (12 U.S.C. 1724(a));
    (5) A thrift institution (savings bank, building and loan 
association, credit union, industrial bank or other);
    (6) An insurance company;
    (7) A loan or finance company; or
    (8) A person subject to supervision by any state or federal bank 
supervisory authority.
    (d) Forms and Procedures--(1) Forms for broker surety bonds and 
trust agreements. Form BMC-84 broker surety bond will be filed with the 
FMCSA for the full security limits under subsection (a); or Form BMC-85 
broker trust fund agreement will be filed with the FMCSA for the full 
security limits under paragraph (a) of this section.
    (2) Broker surety bonds and trust fund agreements in effect 
continuously. Surety bonds and trust fund agreements shall specify that 
coverage thereunder will remain in effect continuously until terminated 
as herein provided.
    (i) Cancellation notice. The surety bond and the trust fund 
agreement may be cancelled as only upon 30 days' written notice to the 
FMCSA, on prescribed Form BMC 36, by the principal or surety for the 
surety bond, and on prescribed Form BMC 85, by the trustor/broker or 
trustee for the trust fund agreement. The notice period commences upon 
the actual receipt of the notice at the FMCSA's Washington, DC office.
    (ii) Termination by replacement. Broker surety bonds or trust fund 
agreements which have been accepted by the FMCSA under these rules may 
be replaced by other surety bonds or trust fund agreements, and the 
liability of the retiring surety or trustee under such surety bond or 
trust fund agreements shall be considered as having terminated as of the 
effective date of the replacement surety bond or trust fund agreement. 
However, such termination shall not affect the liability of the surety 
or the trustee hereunder for the payment of any damages arising as the 
result of contracts, agreements or arrangements made by the broker for 
the supplying of transportation prior to the date such termination 
becomes effective.
    (3) Filing and copies. Broker surety bonds and trust fund agreements 
must be filed with the FMCSA in duplicate.

[53 FR 10396, Mar. 31, 1988]