The Federal Motor Carrier Safety Administration is moving closer to settling a controversy over how to define truck brokers while also clarifying the level of financial penalties for unauthorized brokerages.
In a notice scheduled to be published in the federal register on Friday, FMCSA is asking the public for responses to a series of questions “to inform future guidance on the definitions of broker and bona fide agents,” the agency stated.
“Over the past decade, FMCSA has received numerous inquiries and several petitions related to the definition of a broker. FMCSA is aware that there is significant stakeholder interest” in how FMCSA enforces unauthorized brokerages, it noted.
Part of the problem is that there are differences in the definition of a broker in different sections of federal regulations. In addition, because the responsibilities of truck brokers and freight dispatchers sometimes overlap, there is a question as to whether a dispatch service is acting as a licensed broker without proper authority.
For example, FMCSA points out in its information request that some dispatch services cite federal regulation 49 CFR 371.2(b) as the reason they do not get an FMCSA brokerage authority registration. The section states that bona fide agents are “persons who are part of the normal organization of a motor carrier and perform duties under the carrier’s directions pursuant to a preexisting agreement which provides for a continuing relationship, precluding the exercise of discretion on the part of the agent in allocating traffic between the carrier and others.”
But some dispatch services interpret this regulation, FMCSA notes, “as allowing them to represent more than one carrier yet not obtain broker operating authority registration. Others interpret this regulation to argue that a dispatch service can only represent one carrier without obtaining broker authority.”
FMCSA stated that its new guidance is required by law to “take into consideration the extent to which technology has changed the nature of freight brokerage, the role of bona fide agents and other aspects of the freight transportation industry.”
Additionally, FMCSA must, at a minimum:
Questions for which FMCSA is seeking responses include:
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