Broker Carrier Agreement Template for the United States

A Broker Carrier Agreement is a legally binding contract that governs the relationship between freight brokers and motor carriers in the United States transportation industry. This document establishes the terms under which carriers will transport freight arranged by brokers, ensuring compliance with federal regulations while protecting both parties' interests. The agreement serves as the foundation for ongoing business relationships in interstate commerce, incorporating essential protections required by federal motor carrier regulations.

When do you need this document?

You need a Broker Carrier Agreement whenever establishing a new relationship between a licensed freight broker and motor carrier for ongoing transportation services. This includes situations where brokers regularly tender loads to specific carriers, when carriers seek to join a broker's preferred carrier network, or when formalizing previously informal arrangements. The agreement is also essential when carriers provide specialized services requiring specific terms, such as temperature-controlled transportation or hazardous materials handling. Additionally, you'll need this document to comply with FMCSA recordkeeping requirements and to establish clear liability frameworks before the first load is tendered.

Key legal considerations

Several critical legal elements must be addressed in your Broker Carrier Agreement. Insurance requirements are paramount, with carriers typically required to maintain minimum liability coverage levels and name brokers as additional insureds. The agreement must clearly define payment terms, including when payment is due and procedures for resolving billing disputes. Liability allocation clauses are crucial for determining responsibility in case of cargo damage, loss, or delays. You should also include compliance certifications ensuring the carrier maintains proper operating authority, drug and alcohol testing programs, and safety ratings. Indemnification provisions protect both parties from third-party claims, while termination clauses establish procedures for ending the relationship while protecting ongoing shipments.

Legal requirements in United States

Under United States federal law, Broker Carrier Agreements must comply with Federal Motor Carrier Regulations found in 49 CFR Part 371. Brokers must maintain copies of agreements with all contracted carriers as part of their required records, and these documents must be available for FMCSA inspection. The agreement must verify that carriers possess valid operating authority under 49 USC §13904 and maintain required insurance levels. MAP-21 requirements mandate that brokers ensure carriers meet federal safety standards and maintain current safety ratings. Vehicle leasing regulations under 49 CFR Part 376 may apply if the arrangement involves equipment interchange. Additionally, the agreement must incorporate federal safety regulations from 49 CFR Part 390, ensuring carriers comply with hours of service, drug testing, and vehicle maintenance requirements that affect interstate commerce operations.