Truckers need to be louder on broker transparency petition
October 30, 2020
The Federal Motor Carrier Safety Administration hosted a listening session to get feedback about petitions calling for more broker transparency. Truckers showed up, but not enough.
During the broker transparency listening session, a few dozen people spoke out either for or against two petitions calling for stricter enforcement of existing broker transparency regulations. Several truckers called in and voiced their concerns with brokers. However, brokers showed up in greater numbers.
To be fair, the broker transparency listening session was more conducive for the brokers. It’s not easy for people driving a truck hundreds of miles to sit in on a federal listening session. Meanwhile, all of the brokers are sitting at a desk with all the time in the world to call in.
The broker transparency listening session was just one way to get your voice heard.
Truckers can and should submit comments by going to Regulations.gov, entering the docket number FMCSA-2020-0150 in the “Keyword” block and clicking “Search.” From there, click on the “Comment Now!” button. Additionally, FMCSA recommends that you include your name, email address, or phone number in the body of your document. The deadline is Nov. 18. As of Oct. 30, about 1,200 comments were on the docket
Comments submitted by truckers during the broker listening session were all unique, while all the brokers kept regurgitating the same talking points. It’s always good to know what others are saying. Below are some comments that were made during the broker transparency listening session.
Truckers’ broker transparency comments
“(The federal regulation) is designed to promote transparency, which promotes free market competition. The notion here is visibility, and we’re dealing with transactions when an intermediary exists in a typical transaction between two parties. Obviously, both parties know what they’re transacting to. But when you insert an intermediary, you create the opportunity for one of those parties to be in the dark. And that’s what (the federal regulation) tries to deal with, to make sure that all the parties to the transaction have all of the information.”
“One: Broker transparency requirements of (the federal regulation) should be made nonwaivable, and their required information should be required to be produced to the prospective driver before the load is booked. I believe this is how (the federal regulation) already reads, but that should be clarified/enforced. Two: Double brokering rules should be enacted to prohibit the act of double brokering where loads are brokered from one broker to another before reaching the drivers.”
“This affects all people. When the carrier does not know the rate the shipper pays, then we do not know how to properly negotiate the rate. Almost all the time we end up grossly shorted and the shippers are grossly overcharged. We do have the right to accept or not accept the load. However, the brokers are bullies. If you ask too many questions you will be blackballed and put on a ‘do not use’ list.”
“Those of us, like myself, in the industry, we have heard, we have seen, we have experienced the double brokering, the false quotes, the inflated prices from the broker to the shipper and by the time we get it. This federal regulation was meant to protect the trucker, the shipper and the end-user, who is the consumer.”
“These brokers have become like what we are experiencing with bad police standing out among the good police. They are rude when asked for transparency of rates and blackball you from booking future business. Yes, we have a choice to choose a different broker. But it must be a mandate for broker transparency, for bad brokers in this business. It has been proven with speaking with some shippers that carriers are highly unpaid due to lack of transparency.”
“I don’t think there’s one (broker) that would enter a real estate agreement with their real estate broker without knowing how much they’re selling their house for, how much the broker’s getting and how much the person is buying the house. That’s all disclosed. We all expected that when dealing with those kind of things.”
“Congress has expressed a manifest desire to allow parties to broker a transaction to waive rights, including the right to contract out of disclosure requirements. This was done in part to protect against disclosure of rates, to bolster the concept of freedom of contract and the free marketplace. Again, in 2016, Congress enacted the Federal Defense Trade Secrets Act to protect and preserve trade secrets.”
“If the broker is forced to share the right information to the carrier, it will perilously affect the shipper, which will also affect the broker and ultimately affect the carrier. Without the shipper, a carrier is not needed.”
“A vendor should not have the legal right to see the contracts of its customers. The freight broker carrier interaction is a free market transaction based completely on supply and demand. No broker forces a carrier to take a load. Carriers are free to pursue their own customers and/or avoid using brokers altogether.”
“While allowing carriers to see the pricing brokers receive on loads sounds reasonable, is it really? Do we get to see what retailers pay for their products? The carrier has the final say on what they will haul a load for. The dollar amount the broker receives for their services and dealings with the shipper is frankly none of the carrier’s business. The carrier can source and find their own shippers if they choose. This is what free enterprise is all about.”
“Rates in the spot market are already incredibly transparent. Transportation services providers like Truckstops provide real time visibility to both capacity demand and pricing. This is more transparency than 49 CFR 371.3 was ever designated to generate. This transparency gives carriers more than enough to assess current market rates without having to dive into specifics on the growth of gross margin on a load-by-load basis. Carriers may choose to accept the rate or move on to another load.”
“The notion that a vendor has the legal right to see the contracts of his customer is unheard of and unreasonable to the extreme. Like all forms of free market commerce, no broker is forcing any carrier to take any loads. It is always the choice of any carriers to try to find shipping customers of their own. Carriers have options in the supply chain, options to choose their broker and options to opt out of utilizing a broker altogether.” LL