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Operating authority is the legal license that allows a carrier or broker to transact freight in interstate commerce. The federal regulator issues several types, and carriers can hold one or more at the same time. This guide explains what each type allows, when revocation matters, and how to read authority history during verification.
The federal regulator issues four primary types of operating authority: Common Carrier (for-hire, general public), Contract Carrier (for-hire, specific shippers under contract), Broker (arranges transportation, does not own equipment), and Freight Forwarder (consolidates and re-ships freight). A motor carrier can hold both Common and Contract authority. A Broker holding only Broker authority cannot legally haul freight. Status must be 'active' for any authority to be valid for tender.
A Common Carrier ("Authorized For Hire" in regulatory terminology) is a motor carrier authorized to haul freight for the general public, at published or negotiated rates, on terms that are generally available to any shipper. Most truckload carriers brokers work with hold Common Carrier authority.
Key implications: Common Carriers must accept any reasonable load offer (in theory), publish their rates upon request, and operate under a "duty of care" that is higher than a private hauler. In practice, most modern Common Carriers operate under one-off rate confirmations rather than published tariffs — but the regulatory framework still applies.
A Contract Carrier is a motor carrier authorized to haul freight only for shippers with whom they have a continuing contract. The carrier-shipper relationship is the basis of the authority — without a contract, a Contract Carrier has no business basis for hauling that shipper's freight.
Many large carriers hold both Common and Contract authority. Contract authority gives them flexibility on dedicated lanes (where they negotiate with a specific shipper) while Common authority lets them pick up backhauls and spot freight from any source.
For day-to-day tendering, it usually does not. If the carrier holds either Common or Contract authority (or both) and is active, you are clear to tender. The distinction matters more for shippers — a Contract Carrier without a written contract with that shipper is technically outside their authority.
Freight Forwarders accept freight, consolidate it, and re-ship it under their own bill of lading. They differ from brokers in that they take legal possession of the freight (a broker never does). Freight Forwarders typically operate at scale — consolidation centers, warehouse hubs, and multi-stop distribution.
Most truckload brokers will encounter Freight Forwarders rarely. The FF authority is more common in LTL and parcel logistics, where consolidation is a core part of the business model.
The federal regulator can take authority away for several reasons. The vocabulary matters:
A carrier in "OUT-OF-SERVICE" status is not legally allowed to haul. Authority being "active" with a populated OOS date does not save them. If you see an OOS flag, do not tender.
Yes, in theory. Some larger logistics companies hold Common, Contract, and Broker authority simultaneously, with Freight Forwarder authority added if they operate consolidation hubs. Each authority is a separate federal filing with its own insurance/bond requirements.
Yes. Anyone arranging the transportation of regulated freight in interstate commerce for compensation must hold Broker authority. Operating as an unlicensed broker is the underlying federal violation in many double-brokering enforcement cases.
Federal application fees are modest (~$300 for Motor Carrier authority, similar for Broker). The total cost is higher when you add the surety bond ($75,000 face value, typically 1-3% premium for brokers) and required insurance for motor carriers ($750,000 liability minimum). Total first-year cost for a Broker is typically several thousand dollars.
Usually yes, depending on the reason for revocation. Insurance-lapse revocations can be reinstated by re-filing insurance and paying any back fees. Safety-driven revocations may require a Compliance Review or Corrective Action Plan. Reinstatement does not always restore the original MC number's history — and the timing of reinstatement is one of the strongest signals in identity-flip fraud detection.
Registration (USDOT number) covers safety — every commercial motor carrier subject to federal safety regulation gets one, regardless of for-hire vs private status. Authority (MC, FF, Broker) covers commercial activity — only for-hire interstate operations of regulated freight need it. A private fleet hauling its own goods has a USDOT but does not need an MC.
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