This rule includes provisions such as the suspension of operating authority if financial security drops below $75,000. While the Owner-Operator Independent Drivers Association (OOIDA) views this rule as a positive step, it advocates for further measures to ensure fairness in the broker-carrier relationship.

OOIDA submitted a petition for reconsideration in December to enhance the rule’s effectiveness. Despite OOIDA’s requests, FMCSA has informed the association that it will continue to enforce the finalized rule, which came into effect in January. The agency justified its decision by stating that OOIDA’s proposals were beyond the scope of this specific rule, though it acknowledged ongoing efforts to address broker-related issues.

FMCSA’s final rule aims to streamline broker and freight forwarder financial responsibility by:

• Limiting acceptable asset types in trusts
• Establishing procedures for immediate operating authority suspension if financial security falls short
• Defining financial failure or insolvency criteria

It also introduces civil penalties for surety and trust fund violations and outlines a process for their suspension in cases of non-compliance.

In its petition, OOIDA urged for the inclusion of broker knowledge and experience provisions, an annual report on broker fraud, a seven-day claims investigation period, and public disclosure of broker financial insolvency.

“We believe various modifications can improve the economic health of the broker/motor carrier component of the transportation industry,” OOIDA wrote. “Additionally, small-business motor carriers who rely upon brokers will be spared financial loss from both brokers and ineffective bonds or trusts under these suggested amendments. This will result in safe, experienced motor carriers staying in business along with a more transparent process for both industry stakeholders and general consumers.”

The FMCSA did reject most of these requests.

“Thus, the agency will not be making any changes to the rule based on these requests,” FMCSA wrote. “Regarding your request to implement a seven-day claims investigation period, FMCSA believes a full and fair investigation of each claim is necessary. While many investigations take seven days or less, there may be instances in which a surety provider requires additional time. Thus, the agency decided not to place a time limitation on the claims investigation process and declines to reconsider this provision.”

However, it seems to be addressing these concerns in other ways. FMCSA has indicated a willingness to consider displaying broker financial insolvency information on its Safety and Fitness Electronic Records (SAFER) page, although it believes such action should not be mandated.

Additionally, the agency has granted petitions from both OOIDA and the Transportation Intermediaries Association (TIA) to address broker-related issues. TIA’s petition, submitted in June last year, dealt with implementing and enforcing existing experience and training requirements for brokers and freight forwarders. While FMCSA granted this petition, the rulemaking process hasn’t started. Similarly, OOIDA’s petition, aimed at enhancing broker transparency, is expected to initiate the rulemaking process in the coming fall, following FMCSA’s delay in action since the association’s petition in 2020.

Source: Land Line

The post Broker Final Rule Remains as FMCSA Plans Other Rulemakings appeared first on Truck Drivers USA.

Although the official notice of approval has yet to appear in the Federal Register, FMCSA closed the petition for rulemaking and notified TIA of its approval in a letter dated March 11.

TIA originally petitioned the agency in June 2023, urging the implementation and enforcement of existing provisions regarding experience and training prerequisites for brokers and freight forwarders entering the market. This call for action stems from a specific provision within the Moving Ahead for Progress in the 21st Century Act, enacted in 2012.

That provision said that, “a broker or freight forwarder must employ as an officer an individual who has three years of relevant experience or provides the Secretary of Transportation with satisfactory evidence of the individual’s knowledge of related rules, regulations and industry practices.”

“Unfortunately, incidents of fraud have only increased over the past decade, culminating in a plague of fraud in 2023,” TIA wrote. “Today’s marketplace remains filled with fraudulent entities and criminal actors who sully the marketplace at the expense of all regulated entities and ultimately impose an estimated $800 million per year upon American consumers.”

Highlighting concerns over the proliferation of unscrupulous brokers, freight forwarders, and motor carriers, often referred to as “reincarnated” or “chameleon” entities, TIA underscored the need for rigorous enforcement, especially amid the market disruptions caused by the global pandemic.

“The U.S. Congress, through MAP-21, sought to address these concerns through the TIA-supported legislative language, but unfortunately and inexplicably, the agency has failed to implement several key provisions, including the experience or training requirement,” the group wrote. “At the very least, these requirements could help to mitigate rampant fraud by criminals who are entering the marketplace on a regular basis with hundreds of different authorities.”

To obtain operating authority from FMCSA, TIA recommends that brokers either employ individuals with relevant experience or select candidates who have completed an FMCSA-certified course from an accredited institution. The suggested course duration ranges from 30 to 90 hours and can be completed online or in person.

“TIA urges the agency to take immediate action regarding this petition,” the group wrote. “The actions requested will strengthen the registration process of brokers and freight forwarders and weed out bad actors. These changes will improve safety throughout the supply chain by barring criminal and otherwise irresponsible actors from the marketplace.”

Source: Land Line

The post Broker Training Petition Granted by FMCSA appeared first on Truck Drivers USA.