Issue link: https://read.dmtmag.com/i/183648
BROKER BASICS freight forwarder as defined by Congress; the entity must assemble or consolidate as well as break-bulk and distribute shipment. A decision that still stands today. To subcontract a load that the origin carrier will not transport at all, the origin carrier needs freight forwarder authority. However, only freight forwarders, as defined by Congress are subject to the ICA. Forwarders of car load (CL) and trailer load (TL) shipments are, by the same statute, exempt from regulation. So if TL and CL carriers are exempt, how and why do they need to register under the new law and does the status of freight forwarder even apply to them if they do register, since they are exempt by law. Confused? So is Congress, apparently. For Brokers… Motor carrier brokers were included in the MCA of 1932. For a significant period of time three different authorities were issued by the ICC (1) a "Certificate of Public Convenience & Necessity" (CPCN) for common carriage; (2) a "Permit" to contract carriers; and (3) a "License" to motor carrier brokers of property. "Deregulation" has blurred the legal and regulatory distinctions between the various players. It now appears that defense attorneys have been able to persuade judges and juries that holding an intermediary for a vehicle accident involving an "unfit" motor carrier is the responsibility of the federal government, not the party bringing shipper and carrier together for the benefit of both. However, pivotal to this new-found immunity is a significant caveat which states that the brokerage activity must be provided pursuant to the Interstate Commerce Act. Dealing with "unregulated" commodities or "unregulated" transportation entities removes the ICA's protective cloak. For all its mind-numbing complexities, MAP-21 does one important thing; it eliminates a motor carrier who has agreed to transport a shipment from claiming after a large loss that he was not a carrier but a broker for that particular shipment. By assigning unique identification numbers (in lieu of a motor carrier "license" in the older days), once again there will be a Berlin-type wall separating broker-arranged shipments from "subcontracted" shipments. As previously stated. MAP-21 contains insurance traps the size of sink-holes for unwary transportation entities. But the better you understand the law, the least likely you will be to tumble into the abyss. Robert Mucci of Wolpert Insurance Agency, Inc. in Worcester, MA is a Certified Insurance Councilor, Accredited Advisor in Insurance, a MA Licensed Insurance Advisor, a Certified Master Workers Compensation Advisor and a former Certified Public Accountant with PWc and Bain & Company, Inc. He has more than 25 years experience in the insurance industry specializing in commercial risk strategies. For additional information he can be reached at 508-459-4760 and robert@wolpert.com. For more OO information visit www.wolpert.com. / OWNER OPERATOR/ OCTOBER 2013 / / 54 OO 1013 broker basics.indd 3 9/6/13 2:12 PM