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Freight Brokers, Freight Forwarders, NVOCCs and Indirect Air Carriers: Negotiating with Transportation Intermediaries in the U.S. and Canada by Land, Sea or Air

Negotiating the Pertinent Provisions of Logistics Agreements

Recording of a 90-minute CLE webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
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Conducted on Thursday, November 12, 2020

Recorded event now available

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This CLE course will focus on the difference between transportation intermediaries that merely arrange for transportation (sometimes referred to as an agency model), and those that take responsibility for the transportation (sometimes referred to as a principal model), and how counsel can address the concerns that each type of arrangement has related to other actors in the supply chain in each primary mode of transportation in the U.S. and Canada. The panel will discuss the key provisions of each type of agreement and provide best practices on negotiating and drafting to insulate clients from risk and mitigate vulnerabilities due to disruptions.


The global supply chain and worldwide movement of goods has created a growing number of actors in the international transportation field. In addition to shippers and carriers, additional stakeholders have arisen as necessary middlemen to get products to market. The names of these entities vary by country and by mode of transportation, as do the regulations and default liability rules. Counsel advising clients with respect to contracts with transportation intermediaries must understand the distinctions and legal implications under a wide array of federal, provincial, state, and international transportation laws and negotiate the specific contracts that comply with these myriad rules while effectively allocating risk and reducing liability exposure.

“Principal” transportation intermediaries (those that take responsibility for the transportation even if they do not perform the services themselves) may both negotiate the delivery of goods between shippers and recipients and take possession of those products, sometimes solely in transport and, at other times, to store until another segment of travel can be arranged. In arranging transportation with a “principal” transportation intermediary, it is important to clarify what liabilities and functions are or are not assumed and what is necessary for adequate insurance coverage. Such intermediaries have the added potential responsibility of negotiating customs clearance of the goods in their possession and must be aware of the risks associated with those duties.

Counsel for “Agent” transportation intermediaries (those that merely arrange transportation with third party providers) must ensure that their clients are acting solely as third-party negotiators and not inadvertently creating liability for the goods in question. Sometimes such intermediaries elect to take on such liability, but this should be a point of negotiation not carelessness. These contracts should stress the importance of indemnity/hold harmless provisions, as well as the need for potentially more than the minimum insurance requirement provisions to cover reasonably foreseeable losses. Risk of non-payment to a carrier (or the prospect of double payment by the shipper) is typically greater, and vetting of parties to the transaction is important.

Understanding the allocation of liability between the different parties in a transportation agreement, the nature of the intermediary's role, and the necessary insurance is part of the foundation of creating enforceable contracts. Counsel should also consider other essential provisions, including service rates, payment terms, damages, best efforts, force majeure, confidentiality, and more.

Listen as our authoritative panel of transportation attorneys explains best practices for drafting freight forwarder and freight broker contracts and when each should be used. The panel will provide strategies for counsel to avoid common contracting pitfalls when negotiating terms to minimize the risk of loss, damage, or non-delivery of commercial goods.



  1. Transportation intermediary as “agent”: definitions and distinctions in the U.S. and Canada
  2. Transportation intermediary as “principal”: definitions and distinctions in the U.S. and Canada
  3. Transportation by mode in the U.S. and Canada with both types of intermediaries:
    1. Truck (U.S. and Canada)
    2. Rail (U.S. and Canada)
    3. Ocean (U.S. and Canada)
    4. Air (U.S. and Canada)
  4. Discussion will include key provisions such as:
    1. Limitation of Liability
    2. Insurance
    3. Consistency between the contract and shipping documents – bills of lading, waybills, receipts
    4. Consistency between the shipper-intermediary contract and the intermediary-carrier contract
    5. Retention of goods and warehousing
    6. Limitation or extension possessory lien rights
    7. Damages – limitations and exclusions
    8. Rates and payment terms
    9. Minimum volume commitments
    10. Delay provisions and Key Performance Indicators (KPIs)
    11. Disputes resolution, choice of law and forum
    12. Special arrangements for high-value shipments or for commodities that require special handling
    13. Force majeure
    14. Best efforts
    15. Key regulatory provisions
    16. Claims handling procedures


The panel will review these and other priority issues:

  • The key distinctions legally and practically between types of transportation intermediaries
  • How federal, state, provincial and international laws govern contracts with transportation intermediaries
  • What are the critical provisions that counsel should carefully negotiate when drafting logistics agreements?
  • How can insurance, as well as contracting strategies, be used to mitigate risk?


Cavanaugh, J. Michael
J. Michael Cavanaugh

Holland & Knight

Mr. Cavanaugh co-chairs Holland & Knight's Energy Team. His practice includes representation of clients in...  |  Read More

Hearn, M. Gordon
M. Gordon Hearn

Fernandes Hearn

Mr. Hearn represents international and domestic interests involved in the transportation, supply chain and distribution...  |  Read More

Rice, Jameson
Jameson B. Rice

Holland & Knight

Mr. Rice focuses his practice primarily on matters pertaining to the transportation industry, with experience in rail,...  |  Read More

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