Broker issues must be addressed, OOIDA tells FMCSA

A lack of enforcement and broker transparency has led to an inequitable environment for motor carriers, the Owner-Operator Independent Drivers Association told FMCSA in a recent letter.

“We urge the agency to take substantive actions that will improve broker transparency, eliminate broker nonpayment of claims and crack down on ever-increasing double brokering practices,” OOIDA wrote in the March 16 letter to the Federal Motor Carrier Safety Administration. “Since the deregulation of the trucking industry, there has been a slow decay of fairness that was once the standard operating procedure between brokers and motor carriers. The agency must work to restore the fairness that is all too often absent in broker transactions.”

In 2020, OOIDA petitioned FMCSA to begin the rulemaking process for more transparency in transactions with brokers. The petition asks the agency:

• To require brokers to automatically provide an electronic copy of each transaction record within 48 hours after the contractual service has been completed.
• To explicitly prohibit brokers from including any provision that requires a carrier to waive their rights to access the transaction records.

Regulation CFR 371.3 already requires that brokers keep records of each transaction with a carrier and that each party to the transaction has a right to view these records.

OOIDA said the agency must not wait any longer to address a problem it has been telling the U.S. Department of Transportation about “for decades.” In addition, the Association submitted its petition nearly three years ago.

“It’s past time for FMCSA to grant the petition and promote broker transparency,” OOIDA wrote. “Not only will access to these documents protect the public by providing a marketplace in which each party behaves in a clear and transparent manner and will also give motor carriers better protections when there are claims or disagreements with brokers.”

Although FMCSA has not made a decision regarding OOIDA’s petition, the agency has issued a pair of notices regarding brokers.

In January, FMCSA published a notice of proposed rulemaking about modifications to broker and freight forwarder financial responsibility requirements. Prompted by 2012’s Moving Ahead for Progress in the 21st Century Act, FMCSA previously implemented a requirement to increase the financial security amount for brokers to $75,000.

FMCSA also published a notice last year asking for feedback regarding how brokers and bona fide agents should be defined to inform its guidance.

Earlier this month, FMCSA announced it will host a public listening session on broker issues on March 31 at the Mid-America Trucking Show in Louisville, Ky. The agency also extended the comment periods on both of its broker notices through April 6.

OOIDA is encouraging its members to comment on the broker financial responsibility notice.

“FMCSA has proposed modifications to broker and freight forwarder financial responsibility requirements,” OOIDA wrote to its more than 150,000 members. “The goal of this proposal is to crack down on brokers and other financial entities that let claims from motor carriers accrue against the minimum $75,000 broker bond. However, the processes outlined in the notice of proposed rulemaking that could help mitigate the need to initiate interpleader proceedings and alleviate the concern of broker non-payment of claims are not satisfactory to accomplish those objectives.”

Truckers who would like to comment can do so at the Fighting for Truckers website. LL