On November 16, 2022, the FMCSA released interim guidance effective immediately to provide clarification about the interpretation of the definitions of “broker” and “bona fide agents”. The interim guidance is in response to a mandate, passed on November 15, 2021, in the Infrastructure Investment and Jobs Act (IIJA). The IIJA mandate intends to prevent brokerage companies from unlawfully operating without proper FMCSA authority and aims to identify safety concerns arising from unlawful broker activities.
This may change the public’s understanding of what determines the need for broker authority without changing the original definition.
The FMCSA’s new list to determine whether a dispatch service should obtain broker authority includes:
- The dispatch service interacts or negotiates a shipment of freight directly with the shipper, or a representative of the shipper;
- The dispatch service accepts or takes compensation for a load from the broker, or factoring company, or is involved in any part of the monetary transaction between any of those entities;
- The dispatch service arranges for a shipment of freight for a motor carrier, with which there is no written legal contract with the motor carrier that meets the aforementioned criteria [details available on the Federal Register];
- The dispatch service accepts a shipment without a truck/carrier, then attempts to find a truck/carrier to move the shipment;
- The dispatch service is a named party on the shipping contract; or
- The dispatch service is soliciting to the open market of carriers for the purposes of transporting a freight shipment.
The public is encouraged to submit comments to the Federal Register by January 27th, 2023. at: https://www.regulations.gov/document/FMCSA-2022-0134-0090
In response to this interim guidance, the Transportation, Housing and Urban Development, and Related Agencies Appropriations Act of 2023 will require the FMCSA to finalize this interim guidance no later than June 16, 2023.
