Illegal Brokering

Jul 29, 2013 at 08:29 AM CST
TransportTopics.com By David Dwinell, Owner, LoadTraining.com In less than 90 days, the new highway law — MAP-21 — is to be enforced in the United States. Here is what our companies are doing to comply. • To all shipping clients: Starting Oct. 1, it is illegal for a motor carrier working with your company to take possession of your freight for “brokering” purposes. Motor carriers are now limited to hauling your load alone, in their own tractor and trailer. This means that the trucker to whom you tendered the load is the only one who can come and load your cargo. If another trucker shows up, you must make out a new bill of lading in that carrier’s name and MC number [Operating Authority] and pay only that carrier. If you are tendering your loads to a broker or logistics company, your bill of lading can be made out only in the actual hauling carrier’s name. Brokers or logistics companies cannot be in possession of your cargo. Failure to comply with the new regulations means two things could happen to your company: It may be subject to the Federal Motor Carrier Safety Administration fine that the illegally brokering motor carrier pays, not to exceed $10,000. Or, your company may have to pay twice for the same act of transporting your load — or both. • To all motor carrier clients: Starting Oct. 1, it is illegal to take possession of your shipper’s cargo for brokering purposes. If you don’t have power and a trailer for that load, you cannot take possession. Only your brokerage can solicit the shipper for the arrangement of transportation, and only your brokerage can invoice that shipper for that move. All motor carriers, even the largest in the nation, can take possession of freight only with their equipment, which may include owner-operators. Every form of “truck brokering” is outlawed. The only brokering allowed after Oct. 1 is licensed property brokering by your own separate brokering company established for brokering with a separate MC number, different company name, Federal Employer Identification Number (FEIN), address and phones, etc. Your motor company is barred from “brokering” as you knew it in the past. • To all our brokering and brokering agent clients: Starting Oct. 1, it is illegal to take a load from another broker or a trucking company. You can arrange transportation only for a shipper, as defined, including forwarders, customs brokers and others named in MAP-21 who are in possession of cargo. Double brokering is prohibited, and the penalty shall not exceed $10,000, if discovered. You must take steps to ensure that the motor carrier you brokered the load to is the one that shows up for the cargo tendered. You are a “shipper” by law, not a carrier, and are subject to failure-to-comply stipulations of the shipper listed above. You can solicit shippers only to “arrange” transportation. You cannot be in possession of that cargo. You cannot insure that cargo, except contingently. You cannot be a party to the BOL as a carrier. You cannot take a beneficial interest in that cargo. Everyone knows that the brokering taking place today, i.e., truck brokering, will not be in conformance with MAP-21. The question is: How will everyone react if and when the new law is enforced? I know of two states actively researching MAP-21 as a new source of much-needed revenue. Is everyone ready to change the way they broker freight? David Dwinell Owner LoadTraining.com Phoenix Taxation Fairness View Original Article

Jul 29, 2013 at 08:29 AM CST

TransportTopics.com By David Dwinell, Owner, LoadTraining.com In less than 90 days, the new highway law — MAP-21 — is to be enforced in the United States. Here is what our companies are doing to comply. • To all shipping clients: Starting Oct. 1, it is illegal for a motor carrier working with your company to take possession of your freight for “brokering” purposes. Motor carriers are now limited to hauling your load alone, in their own tractor and trailer. This means that the trucker to whom you tendered the load is the only one who can come and load your cargo. If another trucker shows up, you must make out a new bill of lading in that carrier’s name and MC number [Operating Authority] and pay only that carrier. If you are tendering your loads to a broker or logistics company, your bill of lading can be made out only in the actual hauling carrier’s name. Brokers or logistics companies cannot be in possession of your cargo. Failure to comply with the new regulations means two things could happen to your company: It may be subject to the Federal Motor Carrier Safety Administration fine that the illegally brokering motor carrier pays, not to exceed $10,000. Or, your company may have to pay twice for the same act of transporting your load — or both. • To all motor carrier clients: Starting Oct. 1, it is illegal to take possession of your shipper’s cargo for brokering purposes. If you don’t have power and a trailer for that load, you cannot take possession. Only your brokerage can solicit the shipper for the arrangement of transportation, and only your brokerage can invoice that shipper for that move. All motor carriers, even the largest in the nation, can take possession of freight only with their equipment, which may include owner-operators. Every form of “truck brokering” is outlawed. The only brokering allowed after Oct. 1 is licensed property brokering by your own separate brokering company established for brokering with a separate MC number, different company name, Federal Employer Identification Number (FEIN), address and phones, etc. Your motor company is barred from “brokering” as you knew it in the past. • To all our brokering and brokering agent clients: Starting Oct. 1, it is illegal to take a load from another broker or a trucking company. You can arrange transportation only for a shipper, as defined, including forwarders, customs brokers and others named in MAP-21 who are in possession of cargo. Double brokering is prohibited, and the penalty shall not exceed $10,000, if discovered. You must take steps to ensure that the motor carrier you brokered the load to is the one that shows up for the cargo tendered. You are a “shipper” by law, not a carrier, and are subject to failure-to-comply stipulations of the shipper listed above. You can solicit shippers only to “arrange” transportation. You cannot be in possession of that cargo. You cannot insure that cargo, except contingently. You cannot be a party to the BOL as a carrier. You cannot take a beneficial interest in that cargo. Everyone knows that the brokering taking place today, i.e., truck brokering, will not be in conformance with MAP-21. The question is: How will everyone react if and when the new law is enforced? I know of two states actively researching MAP-21 as a new source of much-needed revenue. Is everyone ready to change the way they broker freight? David Dwinell Owner LoadTraining.com Phoenix Taxation Fairness

View Original Article