Operating Authority
The term 'operating authority' refers to the legal right of a motor carrier to operate a commercial motor vehicle across the U.S. for the following purposes:
- Transportation of goods and/or passengers in exchange for a fee or other compensation.
- Transportation of goods across intra-state borders, inter-state lines, or national boundaries.
- Arrangement of goods or passengers.
- Storage of goods moved in inter-state commerce.
- Common Contract Or Broker Authority - MC
- Mexican Domiciled Authority - MX
- Freight Forwarder Authority - FF
The operating authority (MC/MX/FF) numbers are also known as docket numbers.
Determine Whether You Need Operating Authority Or Not
To determine whether you need an operating authority or not, you must answer the following questions:
- Are you a private carrier?
- Are you available for hire to haul exempt commodities (goods not regulated by the government)?
- Do you operate exclusively in a federally-designated zone exempt from any inter-state authority?
If "Yes," you do not need operating authority. However, if you do not fall into any of these categories, you will be classified as an entity involved in inter-state commerce; therefore, you will need operating authority.
NOTE: If you deal with hazardous materials, you need operating authority regardless of where you travel across the U.S..
If your cargo crosses state lines, whether loaded on your trucks or not, you are engaged in inter-state commerce.
Motor Carrier (MC) Number
An MC Number is mandatory if you engage in inter-state commerce (i.e., crossing state lines and transporting property). The following are required to have inter-state operating authority (an MC Number) in addition to a DOT Number:
a) Businesses that transport passengers in inter-state commerce for a fee or other compensation - could be direct or indirect.
b) Suppose the transport involves federally-regulated commodities owned by others or require arranging transport for a fee or other compensation in inter-state commerce - in that case, you need an MC Number.
An MC Number identifies a carrier transporting regulated commodities for hire in inter-state commerce. This number is mandatory and relates to items changed from their natural state and/or are regulated commodities by the Federal Motor Carrier Safety Administration (FMCSA)..
Mexican Carrier (MX) Number
"MX" is a prefix for a motor carrier that is owned or controlled by a citizen of Mexico. Specifically, this number refers to a person domiciled in Mexico.
The operating authority (MC/FF/MX Number) is also known as docket numbers.
According to the FMCSA, "Mexico-domiciled motor carrier that enters the U.S. must have an FMCSA-assigned MX Number, a valid FMCSA Certificate of Registration for commercial-zone operations, or long-haul Provisional or Standard Operating Authority Registration, and a U.S. DOT Number regardless of the distance traveled into the U.S."
The MX Number is also assigned to brokers and inter-state for-hire motor carriers that apply for operating authority. The time it takes to obtain an MX Number varies depending on when the application is submitted. It also depends on how the application originated. Be sure to refer to the guidelines enlisted per the Unified Registration System (URS) under Commercial Zone Authority.
Freight Forwarder (FF) Number
An FF Number is issued to Freight Forwarders, whereas brokers and carriers are issued MC Numbers. Since Freight Forwarders cannot transport freight from one state to another, there is no provision for Freight Forwarders to obtain single state registration.
Freight forwarders are responsible for arranging the transportation of goods by FMCSA-licensed carriers. Therefore, Freight forwarders issue bills of lading to shippers and are accountable for the loss of or damage to the goods. Freight Forwarders are required to register with FMCSA. When the FMCSA Operating Authority grants permission to a Freight Forwarder to arrange for inter-state or foreign commerce, an FF Number is issued. Forwarders must register with the Federal Highway Administration (FHWA) by filing a Form OP-1 (FF).
Broker Authority
A broker authority is for an individual, partnership, or corporation that arranges the transportation of belongings to others by using an authorized Motor Carrier (MC) Number.
Types of Broker Authority:
- Brokers of Property(excluding household goods) - Transportation of belongings to others using an authorized Motor Carrier (MC) Number.
- Brokers of Household Goods - Transportation of household goods (personal items and property used at home) to others by using an authorized Motor Carrier (MC) Number.
Things to keep in mind while obtaining Broker Authority:
- An active motor carrier (MC) number.
- A Form BMC-84 (Broker Surety Bond) or Form BMC-85 (Trust Fund Agreement) of $75,000.
- A Form BOC-3 (Designation of Process Agents).
Note: A broker does not assume responsibility for the property and never takes possession.
Mexican Certificate of Registration
Mexican Certificate Registration allows every Mexico-domiciled public motor carrier and private motor carrier to transport freight in commerce from Mexico within a 20-mile radius of the U.S. border.
Below are the forms to be completed to obtain the U.S. DOT Number and operating authority registration:
- The first step is to get a U.S. DOT Number - Form MCS-150 and Instructions–Motor Carrier Identification Report.
- The applicant must complete the OP-2 Application to operate within the commercial zone and Form OP-1 (MX) to conduct operations beyond the commercial zone at the Unified Registration System (URS).
Note: This form is not to be filed if a business is domiciled in the U.S. and the owner or person who controls the business is a Mexican citizen.
Revocation of Operating Authority
Revocation of operating authority means when an existing motor carrier, broker, or freight forwarder is no longer in operation.
When an individual, partnership, or corporation has suspended its operations and they no longer want to be an operator, they can opt-in for voluntary revocation.
Understanding Which Operating Authority Suits You
The type of authority required depends on your category (as shown from the following list):
- Motor Carrier Authority for household goods.
- Broker Of Property except for household goods.
- Broker Of Household Goods.
- United States-Based Enterprise Carrier Of International Cargo (household goods not included).
- FF (Freight Forwarder) Authority.
- Motor Passenger Carrier Authority.
- Non-North American Domiciled Motor Carriers.
The Difference Between Inter-state And Intra-state Operating Authority
When you operate a commercial vehicle in the U.S., you require inter-state operating authority. Operating authority gives you a legal right to do business, transport, or arrange to transport goods and/or passengers. The Federal Motor Carrier Safety Administration (FMCSA) administers the inter-state operating authority (your MC Number).
Intrastate operating authority is your legal right to operate commercial vehicles to transport goods and passengers within intra-state borders.
Remember, each state has different rules and regulations concerning intra-state transportation. If you are working within a state, you need proper registration for your U.S. DOT Number or your intra-state operating authority.
If you are operating without operating authority or beyond the scope of your authority, you could be forced out of service by the FMSCA and be subject to fines.
Applying For Your MC Number
Applying for a new MC Number may take twenty business days to complete. Once you have applied for the MC Number and completed the process, you will be published in the federal registry.
To successfully obtain your MC Number, you must complete additional requirements, such as filing your BOC-3 (Blanket of Coverage) process agent designation, surety bond, insurance, and more.
You are granted at least eighty business days to comply with these requirements. Failure to do so may result in dismissal of your application, and you may have to pay an additional amount for another MC Number or operating authority. The best way is to contact a third-party service provider or agency to quickly help you obtain your MC Number.