Freight Broker Surety Bond and Bonded Transportation - Know the Difference

In today’s world of logistics and freight transportation, you’ll often encounter terms such as “bonded carrier” or “freight broker bond”.

The first thing you should know is that these are not the same thing!

Therefore, if you want to confidently navigate the freight transportation industry, you’ll need to learn what a bonded carrier means, when it’s used, and how it works.

Let’s start with the most important first…

What is the BMC-84 Freight Broker Bond

The BMC-84 freight broker bond is a type of surety bond required by the Federal Motor Carrier Safety Administration FMCSA.

In a nutshell, this bond acts as a safety net, protecting all parties involved in freight shipping!

Why Is BMC-84 Important?

Unlike an insurance policy, this isn’t coverage you buy for your own protection. It’s something you’re required to file with the FMCSA to legally operate. If a broker fails to pay a motor carrier for their services, the surety company behind the bond will step in, pay the claim, and then seek reimbursement from the broker.

That’s why credit score, financial history, and business reputation often affect how much you’ll pay for the bond.

There’s also an alternative to the BMC-84 called the BMC-85 trust fund, where you deposit the full $75,000 into a trust account. Most small and mid-sized brokers prefer the BMC-84 because it doesn’t tie up that kind of capital up front.

How Does a Freight Broker Surety Bond Work

A freight broker surety bond, also called “freight bond,” is very similar, but not quite a legal agreement or obligation towards the completion of something.

The three parties involved are:

• The freight broker
• The FMCSA
• The surety company

Therefore, when a broker applies for authority, this bond is filed with the FMCSA as proof of the financial responsibility. If the broker fails to pay or violates federal regulations, the carrier can file a claim against the bond. If the claim is valid, the bond company pays the affected party up to the bond amount, currently set at $75,000.

What Is Bonded Freight and Bonded Transportation

Well, bonded freight and bonded transportation are both critical aspects in the logistics services that provide ultimate protection for your freight. Both terms are targeting shipping services that are under strict control (external), when goods need to be moved without immediate duties.

Let’s first learn what is a bonded carrier!

What Is a Bonded Carrier

In short, a bonded carrier is a transportation company that is completely authorized to transport freight under customs supervision, typically without paying customs duties upfront.

These carriers are backed by a surety bond, ensuring that taxes and fees will be paid when the goods reach their final destination. This type of carrier is essential for moving goods that need to stay under customs protection until the necessary documentation or payments are completed.

Now you know what a bonded carrier is, so let’s move on to a shipment that carriers' bonding!

Bonded Shipment Meaning

In turn, a bonded shipment refers to freight that is under customs control during transit. This means that the freight (shipping process) is in bond and has not yet been paid for the duties.

So, these types of bonded shipments are most common in international trade, allowing freight to go through specialized hubs while deferred duties are paid. Therefore, if the shipment’s journey or paperwork isn’t fully complete, it remains under the “bond” until everything fully settles down.

Types of Bonded Freight Carriers

There are a few different types of bonded freight carriers, and each of them provides specific roles and duties in the shipping process.

Here are some raw examples of types of bonds and carriers:

• Ocean Carriers: These are large-scale ships moving freight across oceans (international freight shipping), with a bonded status, allowing goods to arrive at ports without duties paid.
• Trucking Freight: The bonded truckers can haul freight across borders while maintaining bond status, which ensures full compliance without being paid.
• Air Freight Carriers: These are planes that carry bonded freight, ensuring the items are stored under supervision until everything is settled.

Benefits of Using a Bonded Carrier for Your Freight Shipment

Well, by using a bonded carrier, you’re going to enjoy a few advantages for your long-distance shipments, especially in international hauls.

Let’s go over the most stand-out features of a bonded carrier:

Smooth Customs Clearance

Bonded carriers are authorized by customs to transport goods without immediate clearance. This means your cargo can keep moving — even if duties or documentation aren't yet finalized.

Deferred Duty Payments

By using a bonded transportation service, if you are an importer, you can easily delay the fees until the shipment has arrived at the final destination.

Fewer or No Delays at Ports

Since bonded carriers receive their approval to move the freight before the shipping starts, of course, under supervision, it’s less likely for the goods to be held up or delayed at borders.

High Security & Compliance

Bonded carriers must meet strict requirements set by the Federal Motor Carrier Safety Administration and customs authorities. This adds a layer of security and ensures your cargo is handled by trusted professionals.

Full Access to Bonded Hubs

Bonded freight can be stored in bonded warehouses without paying duties. This is ideal for shipments waiting for clearance or distribution instructions.

Complex Shipments Flexibility

If your cargo passes through multiple countries or customs zones, bonded carriers can navigate those transitions without delays, offering flexibility and legal protection every step of the way.

How To Become a Bonded Carrier

Now that you know the bonded carrier meaning, if you want to become a bonded carrier, you must apply to the U.S. Customs and Border Protection (CBP) and acquire your carrier bond.

This typically happens through a surety company.

The bond verifies that you fully comply with all the regulations and duties. However, you will also need shipping insurance, a motor carrier number, and compliance with the Federal Motor Carrier Safety Administration FMCSA to get approved. It’s quite slow and delicate.

Once approved, however, you'll be fully authorized to transport bonded cargo and participate in bonded transportation across borders.