OTI Bonds (Ocean Transportation Intermediaries)

Posted on: October 1st, 2013 • In Bonds

Companies that operate as ocean freight forwarders and Non-Vessel Operator Common Carriers (NVOCC) are required to be licensed as an OTI. This guarantees that the contractual relationships between shippers and carriers will be fulfilled. The OTI collects the transportation charges from the shipper for payment to the carrier. The bond is in place to help guarantee those payments are made.

Freight Forwarder Bond (FMC)

Freight forwarders arrange the transportation of goods for importers and exporters with truckers and shipping lines for NVOCCs. Companies that utilize this bond are responsible for arranging for the transportation by common carriers (shipping lines, rail companies, trucks) on behalf of importers and exporters.

The Freight Forwarder bond amount is currently set at $50,000.

Non-Vessel Operator Common Carrier (NVOCC)

Companies that utilize this bond are responsible for the packing, lading and transporting shipping containers directly with an ocean common carrier. The NVOCC acts as a common carrier and issues a bill of lading to the shipper. The NVOCC then, in turn, ships the container with a common carrier.

For domestic NVOCCs, the bond amount is currently set at $75,000.00 and $150,000.00 for foreign NVOCCs.

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