What is Non-Vessel Operating Common Carrier?
A non-vessel operating common carrier (NVOCC) is, under 46 U.S.C. 40102, a common carrier that does not operate the vessels by which the ocean transportation is provided and is a shipper in its relationship with an ocean common carrier. It holds itself out to the public, issues its own house bills of lading and accepts carrier responsibility towards its customers, while buying space from vessel operators. In the US, NVOCCs and ocean freight forwarders together form the category of ocean transportation intermediaries (OTIs), regulated by the Federal Maritime Commission under 46 CFR part 515. NVOCCs based in the US must be licensed, while NVOCCs based outside the US can choose either a license or a registration. NVOCCs must publish their rates in a public tariff, and may use NVOCC rate arrangements or negotiated service arrangements as permitted by FMC rules.
Why it matters for forwarders
Financial responsibility is a condition of operating in US trades: $75,000 for a licensed NVOCC and $150,000 for a foreign-based registered NVOCC, compared with $50,000 for an ocean freight forwarder, with sureties filing Form FMC-48. A license requires a qualifying individual with at least three years of OTI experience in the United States, and foreign registrations (Form FMC-65) must be renewed every three years. Under 46 CFR 515.27, ocean carriers must obtain proof that an NVOCC has a published tariff and financial responsibility before accepting its cargo, so a lapse can stop bookings. As carriers, NVOCCs are subject to the FMC's demurrage and detention billing rules, cargo claims and US advance manifest obligations for their house bills. Forwarders acting as NVOCCs in other countries face different licensing schemes, so check local rules wherever house bills are issued.