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Information for New Brokers

How do I start a freight brokerage?

As you may know, a broker acts a middleman between the carrier and the shipper, helping each to find the other without having to undertake the search themselves. This can be a very good business, provided you comply with the rules and have a clear concept of how to operate successfully.

Freight broker activities are under the jurisdiction of the Federal Motor Carrier Safety Administration (FMCSA), successor to the Interstate Commerce Commission. The FMCSA defines a broker as “a person who, for compensation, arranges, or offers to arrange, the transportation of property by an authorized motor carrier”. You should read 49 C.F.R. Part 371; Brokers of Property, as this is where rules under brokers operate are located.

Step 1: To obtain your brokerage license you must file Form OP-1 with the Federal Motor Carrier Safety Administration (FMCSA) which requires a $300 filing fee. TIA's New Broker Kit has everything you need to get started. It contains the required FMCSA forms, plus modal contracts, TIA's fact filled Transportation Broker's Manual, a TIA Membership Directory, and information about membership. As a new service, TIA will file your BOC-3 (processing agents).

Step 2: If your license is granted, you will be required to post a $10,000 surety bond or trust fund before you can legally engage in brokerage. Here again, TIA can help with TIASurety, the Broker Trust run by Brokers which offers solutions and protections that brokers can’t get anywhere else.

Step 3: You will be required to provide process agent service in each state in which you operate except the one where you reside. Process agents are individuals who can accept legal documents on your behalf from a motor carrier or broker in your name. TIA can provide this service and please contact Tia Johnson at johnson@tianet.org for more information. If you purchase the New Broker Kit, this service is provided.

Step 4: Now you're ready to broker your first shipment, but the real hard work begins. TIA designed the New Broker Course with the top brokers and subject matter experts in the 3PL industry. This course will teach you everything you need to know. Topics cover insurance requirements, finance management, dispatch, and more. Plus, you'll get the New Broker Kit.