Any U.S. company that acts as an NVOCC or ocean freight forwarder needs a license from the Federal Maritime Commission, proof of financial responsibility and, for NVOCCs, a published tariff. Here is what 46 CFR parts 515 and 520 require and how the pieces fit together.
The FMC uses ocean transportation intermediary (OTI) as the umbrella term for two businesses. An ocean freight forwarder, in the United States, dispatches shipments from the U.S. via a common carrier, books or arranges space for them on behalf of shippers, and processes the documentation. A non-vessel-operating common carrier (NVOCC) is a common carrier that does not operate the vessels that carry the cargo and is a shipper in its relationship with the ocean carrier. In plain terms, an NVOCC issues its own bills of lading and takes carrier responsibility toward its customers, while buying space from vessel operators.
The distinction matters because the bond amount, and in practice the paperwork, differ. Many companies hold both authorities. For the documents an NVOCC issues and files once it is licensed, see our guides on the house vs master bill of lading and on ACE AMS manifest filing.
Under 46 CFR 515.3, no person in the United States may advertise, hold itself out or act as an OTI unless it holds a valid FMC license. A person is “in the United States” if it is resident in, or incorporated or established under the laws of, the United States. That covers advertising, not just operating: a website offering NVOCC services is holding out.
Foreign-based NVOCCs have two options. They can register with the FMC as a foreign-based unlicensed NVOCC, using Form FMC-65, or they can obtain a license by opening an unincorporated branch office that is resident in the United States and qualified to do business where it is located.
Eligibility starts with the qualifying individual (QI). Under 46 CFR 515.11, the QI must have at least three years of OTI experience in the United States and the necessary character to provide OTI services. Who can be the QI depends on the business form: the owner of a sole proprietorship, an active managing partner of a partnership, an active officer of a corporation, or a member or manager of an LLC.
On character, the FMC may look at violations of shipping or trade laws, operating as an OTI without a license, felonies and misdemeanors, undischarged bankruptcies, tax liens and judgments, and the status of TWIC credentials or customs broker licenses, among other things.
The application itself is Form FMC-18, “Application for a License as an Ocean Transportation Intermediary”, filed through the FMC's online system. The FMC suggests completing its paper worksheet first, and the license fee is paid after all parts of the application are submitted (FMC: Apply for a license or request a foreign registration).
No one may act as an OTI without furnishing a bond, proof of insurance or other surety in the form and amount the FMC sets. The amounts in 46 CFR 515.21 are:
| Type of OTI | Financial responsibility | Notes |
|---|---|---|
| Ocean freight forwarder (U.S.) | $50,000 | Licensed by the FMC. |
| NVOCC (U.S.) | $75,000 | Licensed by the FMC. |
| Foreign-based NVOCC, licensed | $75,000 | Requires a U.S. branch; the FMC says the bond rider should list the qualifying branch address. |
| Foreign-based NVOCC, registered (unlicensed) | $150,000 | Registers on Form FMC-65; strictly responsible for its employees and agents. |
The bond covers the OTI's transportation-related activities. Groups or associations of OTIs can also provide group coverage; in that case the group's financial responsibility equals the lesser of the individual amounts for each member or $3,000,000 in aggregate. Where several companies use a common trade name, each needs its own proof of financial responsibility.
Licensing is not the end. The FMC states that all NVOCCs operating in the U.S. trades are required to publish a tariff. Under 46 CFR 520.3, common carriers must keep open for public inspection, in automated tariff systems, tariffs showing all rates, charges, classifications, rules and practices on their routes. Most NVOCCs use a tariff publisher, which the rule allows.
Most NVOCC pricing today does not live in the published rate tariff. The FMC exempts NVOCCs from rate publication for negotiated rate arrangements that meet 46 CFR 532.5. An NRA must be in writing, name the parties and their representatives, and be agreed by both sides before the NVOCC receives the cargo. A shipper can accept by signing, by written communication including e-mail, or by booking after receiving the terms, if the NRA includes the specific acceptance language the rule requires in bold capital letters.
The NRA must state the rate, the shipments it applies to and whether surcharges, accessorials or ocean carrier general rate increases apply. Amendments after the first shipment is received apply only to shipments not yet received. Your rules tariff still has to be published, and surcharges referenced from it are fixed for the life of the NRA unless it is amended.
Most licensing delays and compliance problems for new OTIs come from a few avoidable mistakes:
Licensing is a one-time project; staying compliant is daily work. The FMC asks licensees to report changes to the information in their last application within 30 days, and to file a new Form FMC-18 for changes such as a new qualifying individual, a new company name or business structure, or added NVOCC or forwarder authority.
Operationally, the risk is drift between what you agreed, what you published and what you invoiced. Keeping quotes, contracts, NRAs and rating in one system helps. GDZ-ISIS for NVOCCs, for example, rates bills of lading automatically against the tariff by line, port, commodity, equipment type and charge, and compares them with the original quotation. If you are setting up a new NVOCC, talk to GDZ about the systems side once your license and bond are in motion.
Yes, if you are in the United States. 46 CFR 515.3 says no person in the U.S. may advertise, hold itself out or act as an OTI without a valid FMC license. Foreign-based NVOCCs can register instead, or obtain a license through a U.S. branch.
46 CFR 515.21 sets financial responsibility at $75,000 for an NVOCC, $50,000 for an ocean freight forwarder and $150,000 for a registered foreign-based NVOCC. Proof is most often a surety bond.
At least three years of ocean transportation intermediary experience in the United States, plus the necessary character. The QI must be an owner, partner, officer, or LLC member or manager, depending on the business form.
Yes. The FMC says all NVOCCs in the U.S. trades must publish a tariff, and 46 CFR 520.3(f) says failing to maintain one results in license revocation. Rates in qualifying negotiated rate arrangements are exempt from rate publication.
A new rate or change that increases a shipper's cost cannot take effect earlier than 30 calendar days after publication. Decreases can take effect on publication.