Registration of Brokers and Freight Forwarders of Non-Household Goods, 50115-50117 [E6-14064]
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Federal Register / Vol. 71, No. 164 / Thursday, August 24, 2006 / Notices
E. The development of highway
bridges and structures that will
withstand natural disasters;
F. The documentation and wide
dissemination of objective evaluations
of the performance and benefits of these
innovative designs, materials, and
construction methods;
G. The effective transfer of resulting
information and technology; and,
H. The development of improved
methods to detect bridge scour and
economical bridge foundation designs
that will withstand bridge scour.
Additional activities include
collection of project information,
documentation, promotion and wide
dissemination of objective evaluations
of the performance and benefits of these
innovative designs, materials, and
construction methods resulting from the
project studies.
Respondents: 50 State Departments of
Transportation, the District of Columbia
and Puerto Rico.
Frequency: Annual.
Estimated Average Burden per
Response: 1 hour.
Estimated Total Annual Burden
Hours: It is estimated that a total of 100
responses will be received to give us a
total annual burden of 100 hours.
Electronic Access: Internet users may
access all comments received by the
U.S. DOT Dockets, Room PL–401, by
using the universal resource locator
(URL): https://dms.dot.gov, 24 hours
each day, 365 days each year. Please
follow the instructions online for more
information and help.
Authority: The Paperwork Reduction Act
of 1995; 44 U.S.C. Chapter 35, as amended;
and 49 CFR 1.48.
Issued on: August 18, 2006.
James R. Kabel,
Chief, Management Programs and Analysis
Division.
[FR Doc. E6–14068 Filed 8–23–06; 8:45 am]
Federal-aid bridge construction and
bridge rehabilitation projects as required
by 23 U.S.C. 144(r).
DATES: This action is effective August
24, 2006.
ADDRESSES: The report will be posted on
the FHWA Web site at: https://
www.fhwa.dot.gov/bridge/britab.htm.
FOR FURTHER INFORMATION CONTACT: Ms.
Ann Shemaka, Office of Bridge
Technology, HIBT–30, (202) 366–2997,
or Mr. Thomas Everett, Office of Bridge
Technology, HIBT–30, (202) 366–4675,
Federal Highway Administration, 400
Seventh St., SW., Washington, DC
20590. Office hours are from 7:45 a.m.
to 4:15 p.m., e.t., Monday through
Friday, except Federal holidays.
SUPPLEMENTARY INFORMATION: On August
17, 2006, at 71 FR 47558, the FHWA
issued a notice announcing the
availability of a report describing
construction materials used in new
Federal-aid bridge construction and
bridge rehabilitation projects as required
by 23 U.S.C. 144(r). The address section
of that notice inadvertently referenced
an incorrect Web address to access the
report. The purpose of this notice is to
correct the Web address for the Annual
Materials Report on New Bridge
Construction and Rehabilitation. The
correct Web address for the report is:
https://www.fhwa.dot.gov/bridge/
britab.htm.
(Authority: 23 U.S.C. 144(r); Sec. 1114(f),
Pub. L. 109–59, 119 Stat. 1144.)
Issued on: August 21, 2006.
Frederick G. Wright, Jr.,
Federal Highway Executive Director.
[FR Doc. E6–14070 Filed 8–23–06; 8:45 am]
BILLING CODE 4910–22–P
DEPARTMENT OF TRANSPORTATION
BILLING CODE 4910–22–P
Federal Motor Carrier Safety
Administration
DEPARTMENT OF TRANSPORTATION
Registration of Brokers and Freight
Forwarders of Non-Household Goods
Federal Motor Carrier Safety
Administration (FMCSA), United States
Department of Transportation (DOT).
ACTION: Notice of determination.
AGENCY:
Federal Highway Administration
Annual Materials Report on New
Bridge Construction and Bridge
Rehabilitation
Federal Highway
Administration (FHWA), DOT.
ACTION: Notice; correction.
rmajette on PROD1PC67 with NOTICES1
AGENCY:
SUMMARY: This document corrects a
typographical error in the FHWA’s
notice published on August 17, 2006, at
71 FR 47558. The notice announced the
availability of a report describing
construction materials used in new
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SUMMARY: Section 4142 of the Safe,
Accountable, Flexible, Efficient
Transportation Equity Act: A Legacy for
Users (SAFETEA–LU), which was
enacted into law August 10, 2005,
authorizes the Secretary of
Transportation (Secretary) to register
brokers and freight forwarders of nonhousehold goods (otherwise known as
general commodities brokers and freight
forwarders) if the Secretary finds that
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50115
such registration is needed for the
protection of shippers. FMCSA, which
has been delegated authority to exercise
the Secretary’s functions and activities
regarding broker and freight forwarder
registration, is making a finding that
registration of brokers and freight
forwarders of non-household goods is
needed for the protection of shippers.
Accordingly, the Agency will continue
to register all general commodities
brokers and freight forwarders subject to
its jurisdiction.
FOR FURTHER INFORMATION CONTACT: Mr.
Michael J. Falk, Office of Chief Counsel,
202–366–0834; Federal Motor Carrier
Safety Administration, U.S. Department
of Transportation, 400 Seventh Street,
SW., Washington, DC 20590–0001.
SUPPLEMENTARY INFORMATION:
Background
FMCSA’s jurisdiction over interstate
property brokers is conferred by 49
U.S.C. 13501, which gives the Secretary
jurisdiction ‘‘over transportation by
motor carrier and the procurement of
that transportation’’ to the extent the
transportation is in interstate or foreign
commerce. FMCSA’s jurisdiction over
interstate freight forwarders is conferred
by 49 U.S.C. 13531, which gives the
Secretary jurisdiction ‘‘over service that
a freight forwarder undertakes to
provide, or is authorized or required
under [Part B of subtitile IV of title 49,
United States Code] to provide’’ to the
extent the transportation involved is in
interstate commerce.
Brokers and freight forwarders are
transportation intermediaries who
procure the services of motor carriers to
transport property. Brokers generally do
not handle the freight and do not
assume legal liability for cargo loss and
damage. On behalf of shippers, they
arrange for motor carriers to transport
individual shipments from origin to
destination. Freight forwarders assemble
small shipments into larger shipments,
tender them to motor carriers and
ensure that the larger shipment is
disassembled into smaller shipments
upon delivery. Freight forwarders may
take physical possession of the
shipment in carrying out these
functions.1 Freight forwarders issue
bills of lading and assume liability for
cargo loss and damage.
Brokers arranging for transportation of
property in interstate commerce were
first regulated by the Interstate
Commerce Commission (ICC) in 1935;
interstate freight forwarders were
regulated beginning in 1942. These
1 The statutory definitions of broker and freight
forwarder are codified at 49 U.S.C. 13102(2) and
13102(8), respectively.
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50116
Federal Register / Vol. 71, No. 164 / Thursday, August 24, 2006 / Notices
entities were required to obtain
operating authority from the ICC and
meet financial responsibility and other
regulatory requirements. The Surface
Freight Forwarder Deregulation Act of
1986, Pub. L. 99–521, deregulated
general commodities freight forwarders
by removing them from ICC licensing
jurisdiction. The 1986 Act was intended
to ‘‘enable freight forwarders which deal
with general commodities to compete
more effectively with other
transportation services and to improve
the financial health of the freight
forwarding industry’’.2 The 1986 Act
retained ICC jurisdiction over
household goods freight forwarders.
The ICC Termination Act (ICCTA) of
1995, Pub. L. 104–88, reinstated Federal
jurisdiction over general commodities
freight forwarders and required all
freight forwarders to register with DOT.
The Senate report accompanying the
legislation noted that since the 1986
Act, freight forwarders of shipments
other than household goods were not
required to obtain a license from the
ICC, but were required to maintain a
minimum level of cargo liability
insurance. The Senate report also stated
that the ‘‘insurance requirement has
been difficult to monitor and enforce
without a Federal licensing
requirement. By extending the
registration requirement to all freight
forwarders, the bill would fill an
inappropriate regulatory gap.’’ 3
The ICCTA continued the licensing
(registration) and bond requirements for
general commodities brokers, which,
according to the Senate report, were
‘‘needed to protect the public from
unscrupulous brokers.’’ 4 The Motor
Carrier Safety Improvement Act of 1999
(MCSIA), Pub. L. 106–159, created
FMCSA and, among other things,
conferred on it jurisdiction over brokers
and freight forwarders.
Prior to SAFETEA–LU, 49 U.S.C.
13903 and 13904 required FMCSA to
register all freight forwarders and
brokers, provided the prospective
registrant was ‘‘fit, willing and able’’ to
provide service and comply with
applicable regulatory requirements.
Section 4142 of SAFETEA–LU
continued this registration requirement
for freight forwarders and brokers of
household goods. However, section
4142(b) amended § 13903 by providing
that the Secretary may register a person
as a freight forwarder of non-household
goods to provide service subject to
FMCSA jurisdiction if the Secretary
finds that such registration is needed for
Rep. 99–120, p. 2 (July 31, 1985).
Rep. 104–176, p. 12 (Nov. 21, 1995).
4 Id.
the protection of shippers and that the
person is fit, willing, and able to
provide the service and to comply with
applicable regulations of the Secretary
and Surface Transportation Board.
Section 4142(c) of SAFETEA–LU
made a similar amendment to 49 U.S.C.
13904 by providing that the Secretary
may register a person to be a broker of
non-household goods to provide service
subject to FMCSA jurisdiction if the
Secretary finds that such registration is
needed for the protection of shippers
and that the person is fit, willing, and
able to provide the service and to
comply with applicable regulations of
the Secretary and Surface
Transportation Board.
Significance of Brokers and Freight
Forwarders
General commodities brokers and
freight forwarders offer valuable
services to the business community.
They work with motor carriers to find
less expensive transportation
alternatives for commercial shippers
and provide additional services to assist
shippers, such as shipment tracing,
warehousing and storage (freight
forwarders) and filing loss and damage
claims with the motor carrier
responsible for the transportation.
Without these transportation
intermediaries, shippers would have to
devote additional resources to locating
and negotiating with motor carriers and
would likely have to pay higher
transportation costs. Smaller businesses
in particular would be disadvantaged by
not being able to rely on the services
provided by brokers and freight
forwarders. Available statistics also
indicate a growing reliance on these
entities in the shipment of goods.
The number of freight forwarder
applications filed with FMCSA annually
has increased by approximately 80
percent since 2003.6 As with brokers,
these figures indicate that freight
forwarders represent a growing segment
of the transportation industry whose
services are relied upon by many
commercial shippers to meet their
transportation needs.
U.S. Census Bureau statistics indicate
there were 15,782 establishments
involved in the business of freight
transportation arrangement in 1997.
This industry group includes freight
forwarders, marine shipping agents, and
brokers. These businesses generated
revenues of over $16 billion and
employed over 140,000 employees with
a cumulative annual payroll of
approximately $5 billion. While not all
these entities provided services subject
to FMCSA jurisdiction, the more current
MCMIS data indicate that the number of
general commodities brokers and freight
forwarders registered with FMCSA
exceeds the size of the entire freight
transportation arrangement industry
reported in 1997. Although FMCSA
does not have figures on cumulative
revenues and employment for regulated
general commodities freight forwarders
and brokers, the Census data provide a
rough estimate of the potential impact
on the regulated freight transportation
arrangement industry and the national
economy if general commodities freight
forwarders and brokers are unable to be
relied upon by shippers due to lack of
confidence in their activities and
financial responsibilities.
Freight Forwarders
MCMIS indicates that approximately
1,040 active general commodities freight
forwarders are registered with FMCSA.
Registration of Non-Household Goods
Brokers and Freight Forwarders Is
Needed for the Protection of Shippers
Pursuant to section 4142 of
SAFETEA–LU, if the Agency determines
that registration of non-household goods
brokers and freight forwarders is needed
for the protection of shippers, the
Agency may require these entities to
register.
Under 49 U.S.C. 13906(b), brokers
must maintain and file with FMCSA a
bond, insurance policy or other type of
approved security to ensure that the
transportation which the broker
arranges is provided. Currently, FMCSA
regulations require general commodities
brokers to file a surety bond or trust
fund in the amount of $10,000 (49 CFR
387.307(a)). This requirement is
designed to protect shippers who pay
brokers who renege on their obligations
to arrange for the transportation or to
pay the motor carrier. In the latter case,
5 In calendar year 2005, 3,274 applications were
filed, compared to 2,518 in 2003 and 2,816 in 2004.
6 In calendar year 2005, 442 applications were
filed, compared to 244 in 2003 and 205 in 2004.
Brokers
FMCSA’s Motor Carrier Management
Information System (MCMIS) indicates
that approximately 16,930 active general
commodities brokers are registered with
the Agency as of April 17, 2006. The
number of property broker applications
filed annually with FMCSA has
increased by 30 percent since 2003.5
These figures indicate that property
brokers represent an expanding segment
of the transportation industry and are
being utilized to help meet the
transportation needs of a large number
of commercial shippers.
2 S.
3 S.
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Federal Register / Vol. 71, No. 164 / Thursday, August 24, 2006 / Notices
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the motor carrier may attempt to bill the
shipper, who has already paid the
broker for the shipment. It is also
designed to protect motor carriers who
are not paid for their services but are
unwilling or unable to seek payment
from the shipper. Section 13906(b)
financial responsibility requirements are
expressly linked to broker registration
by the statute. In other words, without
a registration requirement, FMCSA has
no statutory authority to impose a
bonding requirement to protect shippers
and carriers against unscrupulous or
financially irresponsible general
commodities brokers.
As is the case with brokers, the
financial responsibility requirements
applicable to freight forwarders are
expressly linked to the registration
requirement. Under 49 U.S.C.
13906(c)(1), FMCSA may register a
person as a freight forwarder only if the
person files with the agency evidence of
public liability insurance to cover
negligent operation, maintenance or use
of motor vehicles by or under direction
and control of the freight forwarder
when providing transfer, collection or
delivery services. Section 13906(c)(2)
permits FMCSA to also require
registered freight forwarders to file
freight forwarder insurance to cover loss
or damage to cargo for which the freight
forwarder provides service. There are no
independent financial responsibility
requirements for the protection of
shippers that would apply if general
commodities freight forwarders are no
longer being registered.
Based on the foregoing, FMCSA finds
that continued registration of nonhousehold goods freight forwarders
under 49 U.S.C. 13903 and nonhousehold goods brokers under 49
U.S.C. 13904 is needed for the
protection of shippers. We also note that
brokers and freight forwarders must
register pursuant to 49 U.S.C. 13901 to
engage in interstate transportation.
Finally, based on FMCSA’s
determination above regarding the
protection of shippers, any registration
appropriately filed between August 10,
2005 (the date of enactment of
SAFETEA–LU) and the date of this
Notice shall be effective on the date the
registration was approved by FMCSA.
Issued on: August 16, 2006.
John H. Hill,
Administrator.
[FR Doc. E6–14064 Filed 8–23–06; 8:45 am]
BILLING CODE 4910–EX–P
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DEPARTMENT OF THE TREASURY
Submission for OMB Review;
Comment Request
The Department of Treasury has
submitted the following public
information collection requirement(s) to
OMB for review and clearance under the
Paperwork Reduction Act of 1995,
Public Law 104–13. Copies of the
submission(s) may be obtained by
calling the Treasury Bureau Clearance
Officer listed. Comments regarding this
information collection should be
addressed to the OMB reviewer listed
and to the Treasury Department
Clearance Officer, Department of the
Treasury, Room 11000, 1750
Pennsylvania Avenue, NW.,
Washington, DC 20220.
Dates: Written comments should be
received on or before September 25,
2006 to be assured of consideration.
Community Development Financial
Institutions Fund
OMB Number: 1559–0016.
Type of Review: Revision.
Form: CDFI 0020.
Title: New Markets Tax Credit
(NMTC) Program Allocation
Application.
Description: The New Markets Tax
Credit (NMTC) Program will provide an
incentive to investors in the form of a
tax credit, which is expected to
stimulate investment in private capital
that, and in turn, will facilitate
economic and community development
in low-income communities. In order to
qualify for an allocation of tax credits
under the NMTC Program an entity
must be certified as a qualified
community development entity and
submit an allocation application to the
CDFI Fund. Upon receipt of such
applications, the CDFI Fund will
conduct a competitive review process to
evaluate applications for the receipt of
NMTC allocations.
Respondents: Private and State, Local
or Tribal Governments.
Estimated Total Burden Hours: 41,650
hours.
Clearance Officer: Matt Josephs,
Community Development Financial
Institutions Fund, Department of the
Treasury, 601 13th Street, NW., Suite
200 South, Washington, DC 20005, (202)
622–9254.
OMB Reviewer: Alexander T. Hunt,
Office of Management and Budget,
Room 10235, New Executive Office
Frm 00092
Fmt 4703
Sfmt 4703
Building, Washington, DC 20503, (202)
395–7316.
Michael A. Robinson,
Treasury PRA Clearance Officer.
[FR Doc. E6–13997 Filed 8–23–06; 8:45 am]
August 18, 2006.
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50117
BILLING CODE 4810–70–P
DEPARTMENT OF THE TREASURY
Submission for OMB Review;
Comment Request
August 18, 2006.
The Department of Treasury has
submitted the following public
information collection requirement(s) to
OMB for review and clearance under the
Paperwork Reduction Act of 1995,
Public Law 104–13. Copies of the
submission(s) may be obtained by
calling the Treasury Bureau Clearance
Officer listed. Comments regarding this
information collection should be
addressed to the OMB reviewer listed
and to the Treasury Department
Clearance Officer, Department of the
Treasury, Room 11000, 1750
Pennsylvania Avenue, NW.,
Washington, DC 20220.
Written comments should be
received on or before September 25,
2006 to be assured of consideration.
DATES:
Alcohol and Tobacco Tax and Trade
Bureau (TTB)
OMB Number: 1513–0009.
Type of Review: Revision.
Title: Application to Establish and
Operate Wine Premises Wine Bond.
Description: TTB F 5120.25,
Application to Establish and Operate
Wine Premises, is the form used to
establish the qualifications of an
applicant applying to establish and
operate wine premises. The applicant
certifies the intention to produce and/or
store a specified amount of wine and
take certain precautions to protect it
from unauthorized use. TTB F 5120.36,
Wine Bond, is the form used by the
proprietor and a surety company as a
contract to ensure the payment of the
wine excise tax.
Respondents: Private Sector.
Estimated Total Burden Hours: 1013
hours.
Clearance Officer: Frank Foote,
Alcohol and Tobacco Tax and Trade
Bureau, Room 200 East, 1310 G Street,
NW., Washington, DC 20005, (202) 927–
9347.
OMB Reviewer: Alexander T. Hunt,
Office of Management and Budget,
Room 10235, New Executive Office
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]]>Agencies
[Federal Register Volume 71, Number 164 (Thursday, August 24, 2006)]
[Notices]
[Pages 50115-50117]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-14064]
-----------------------------------------------------------------------
DEPARTMENT OF TRANSPORTATION
Federal Motor Carrier Safety Administration
Registration of Brokers and Freight Forwarders of Non-Household
Goods
AGENCY: Federal Motor Carrier Safety Administration (FMCSA), United
States Department of Transportation (DOT).
ACTION: Notice of determination.
-----------------------------------------------------------------------
SUMMARY: Section 4142 of the Safe, Accountable, Flexible, Efficient
Transportation Equity Act: A Legacy for Users (SAFETEA-LU), which was
enacted into law August 10, 2005, authorizes the Secretary of
Transportation (Secretary) to register brokers and freight forwarders
of non-household goods (otherwise known as general commodities brokers
and freight forwarders) if the Secretary finds that such registration
is needed for the protection of shippers. FMCSA, which has been
delegated authority to exercise the Secretary's functions and
activities regarding broker and freight forwarder registration, is
making a finding that registration of brokers and freight forwarders of
non-household goods is needed for the protection of shippers.
Accordingly, the Agency will continue to register all general
commodities brokers and freight forwarders subject to its jurisdiction.
FOR FURTHER INFORMATION CONTACT: Mr. Michael J. Falk, Office of Chief
Counsel, 202-366-0834; Federal Motor Carrier Safety Administration,
U.S. Department of Transportation, 400 Seventh Street, SW., Washington,
DC 20590-0001.
SUPPLEMENTARY INFORMATION:
Background
FMCSA's jurisdiction over interstate property brokers is conferred
by 49 U.S.C. 13501, which gives the Secretary jurisdiction ``over
transportation by motor carrier and the procurement of that
transportation'' to the extent the transportation is in interstate or
foreign commerce. FMCSA's jurisdiction over interstate freight
forwarders is conferred by 49 U.S.C. 13531, which gives the Secretary
jurisdiction ``over service that a freight forwarder undertakes to
provide, or is authorized or required under [Part B of subtitile IV of
title 49, United States Code] to provide'' to the extent the
transportation involved is in interstate commerce.
Brokers and freight forwarders are transportation intermediaries
who procure the services of motor carriers to transport property.
Brokers generally do not handle the freight and do not assume legal
liability for cargo loss and damage. On behalf of shippers, they
arrange for motor carriers to transport individual shipments from
origin to destination. Freight forwarders assemble small shipments into
larger shipments, tender them to motor carriers and ensure that the
larger shipment is disassembled into smaller shipments upon delivery.
Freight forwarders may take physical possession of the shipment in
carrying out these functions.\1\ Freight forwarders issue bills of
lading and assume liability for cargo loss and damage.
---------------------------------------------------------------------------
\1\ The statutory definitions of broker and freight forwarder
are codified at 49 U.S.C. 13102(2) and 13102(8), respectively.
---------------------------------------------------------------------------
Brokers arranging for transportation of property in interstate
commerce were first regulated by the Interstate Commerce Commission
(ICC) in 1935; interstate freight forwarders were regulated beginning
in 1942. These
[[Page 50116]]
entities were required to obtain operating authority from the ICC and
meet financial responsibility and other regulatory requirements. The
Surface Freight Forwarder Deregulation Act of 1986, Pub. L. 99-521,
deregulated general commodities freight forwarders by removing them
from ICC licensing jurisdiction. The 1986 Act was intended to ``enable
freight forwarders which deal with general commodities to compete more
effectively with other transportation services and to improve the
financial health of the freight forwarding industry''.\2\ The 1986 Act
retained ICC jurisdiction over household goods freight forwarders.
---------------------------------------------------------------------------
\2\ S. Rep. 99-120, p. 2 (July 31, 1985).
---------------------------------------------------------------------------
The ICC Termination Act (ICCTA) of 1995, Pub. L. 104-88, reinstated
Federal jurisdiction over general commodities freight forwarders and
required all freight forwarders to register with DOT. The Senate report
accompanying the legislation noted that since the 1986 Act, freight
forwarders of shipments other than household goods were not required to
obtain a license from the ICC, but were required to maintain a minimum
level of cargo liability insurance. The Senate report also stated that
the ``insurance requirement has been difficult to monitor and enforce
without a Federal licensing requirement. By extending the registration
requirement to all freight forwarders, the bill would fill an
inappropriate regulatory gap.'' \3\
---------------------------------------------------------------------------
\3\ S. Rep. 104-176, p. 12 (Nov. 21, 1995).
---------------------------------------------------------------------------
The ICCTA continued the licensing (registration) and bond
requirements for general commodities brokers, which, according to the
Senate report, were ``needed to protect the public from unscrupulous
brokers.'' \4\ The Motor Carrier Safety Improvement Act of 1999
(MCSIA), Pub. L. 106-159, created FMCSA and, among other things,
conferred on it jurisdiction over brokers and freight forwarders.
---------------------------------------------------------------------------
\4\ Id.
---------------------------------------------------------------------------
Prior to SAFETEA-LU, 49 U.S.C. 13903 and 13904 required FMCSA to
register all freight forwarders and brokers, provided the prospective
registrant was ``fit, willing and able'' to provide service and comply
with applicable regulatory requirements. Section 4142 of SAFETEA-LU
continued this registration requirement for freight forwarders and
brokers of household goods. However, section 4142(b) amended Sec.
13903 by providing that the Secretary may register a person as a
freight forwarder of non-household goods to provide service subject to
FMCSA jurisdiction if the Secretary finds that such registration is
needed for the protection of shippers and that the person is fit,
willing, and able to provide the service and to comply with applicable
regulations of the Secretary and Surface Transportation Board.
Section 4142(c) of SAFETEA-LU made a similar amendment to 49 U.S.C.
13904 by providing that the Secretary may register a person to be a
broker of non-household goods to provide service subject to FMCSA
jurisdiction if the Secretary finds that such registration is needed
for the protection of shippers and that the person is fit, willing, and
able to provide the service and to comply with applicable regulations
of the Secretary and Surface Transportation Board.
Significance of Brokers and Freight Forwarders
General commodities brokers and freight forwarders offer valuable
services to the business community. They work with motor carriers to
find less expensive transportation alternatives for commercial shippers
and provide additional services to assist shippers, such as shipment
tracing, warehousing and storage (freight forwarders) and filing loss
and damage claims with the motor carrier responsible for the
transportation. Without these transportation intermediaries, shippers
would have to devote additional resources to locating and negotiating
with motor carriers and would likely have to pay higher transportation
costs. Smaller businesses in particular would be disadvantaged by not
being able to rely on the services provided by brokers and freight
forwarders. Available statistics also indicate a growing reliance on
these entities in the shipment of goods.
Brokers
FMCSA's Motor Carrier Management Information System (MCMIS)
indicates that approximately 16,930 active general commodities brokers
are registered with the Agency as of April 17, 2006. The number of
property broker applications filed annually with FMCSA has increased by
30 percent since 2003.\5\ These figures indicate that property brokers
represent an expanding segment of the transportation industry and are
being utilized to help meet the transportation needs of a large number
of commercial shippers.
---------------------------------------------------------------------------
\5\ In calendar year 2005, 3,274 applications were filed,
compared to 2,518 in 2003 and 2,816 in 2004.
---------------------------------------------------------------------------
Freight Forwarders
MCMIS indicates that approximately 1,040 active general commodities
freight forwarders are registered with FMCSA. The number of freight
forwarder applications filed with FMCSA annually has increased by
approximately 80 percent since 2003.\6\ As with brokers, these figures
indicate that freight forwarders represent a growing segment of the
transportation industry whose services are relied upon by many
commercial shippers to meet their transportation needs.
---------------------------------------------------------------------------
\6\ In calendar year 2005, 442 applications were filed, compared
to 244 in 2003 and 205 in 2004.
---------------------------------------------------------------------------
U.S. Census Bureau statistics indicate there were 15,782
establishments involved in the business of freight transportation
arrangement in 1997. This industry group includes freight forwarders,
marine shipping agents, and brokers. These businesses generated
revenues of over $16 billion and employed over 140,000 employees with a
cumulative annual payroll of approximately $5 billion. While not all
these entities provided services subject to FMCSA jurisdiction, the
more current MCMIS data indicate that the number of general commodities
brokers and freight forwarders registered with FMCSA exceeds the size
of the entire freight transportation arrangement industry reported in
1997. Although FMCSA does not have figures on cumulative revenues and
employment for regulated general commodities freight forwarders and
brokers, the Census data provide a rough estimate of the potential
impact on the regulated freight transportation arrangement industry and
the national economy if general commodities freight forwarders and
brokers are unable to be relied upon by shippers due to lack of
confidence in their activities and financial responsibilities.
Registration of Non-Household Goods Brokers and Freight Forwarders Is
Needed for the Protection of Shippers
Pursuant to section 4142 of SAFETEA-LU, if the Agency determines
that registration of non-household goods brokers and freight forwarders
is needed for the protection of shippers, the Agency may require these
entities to register.
Under 49 U.S.C. 13906(b), brokers must maintain and file with FMCSA
a bond, insurance policy or other type of approved security to ensure
that the transportation which the broker arranges is provided.
Currently, FMCSA regulations require general commodities brokers to
file a surety bond or trust fund in the amount of $10,000 (49 CFR
387.307(a)). This requirement is designed to protect shippers who pay
brokers who renege on their obligations to arrange for the
transportation or to pay the motor carrier. In the latter case,
[[Page 50117]]
the motor carrier may attempt to bill the shipper, who has already paid
the broker for the shipment. It is also designed to protect motor
carriers who are not paid for their services but are unwilling or
unable to seek payment from the shipper. Section 13906(b) financial
responsibility requirements are expressly linked to broker registration
by the statute. In other words, without a registration requirement,
FMCSA has no statutory authority to impose a bonding requirement to
protect shippers and carriers against unscrupulous or financially
irresponsible general commodities brokers.
As is the case with brokers, the financial responsibility
requirements applicable to freight forwarders are expressly linked to
the registration requirement. Under 49 U.S.C. 13906(c)(1), FMCSA may
register a person as a freight forwarder only if the person files with
the agency evidence of public liability insurance to cover negligent
operation, maintenance or use of motor vehicles by or under direction
and control of the freight forwarder when providing transfer,
collection or delivery services. Section 13906(c)(2) permits FMCSA to
also require registered freight forwarders to file freight forwarder
insurance to cover loss or damage to cargo for which the freight
forwarder provides service. There are no independent financial
responsibility requirements for the protection of shippers that would
apply if general commodities freight forwarders are no longer being
registered.
Based on the foregoing, FMCSA finds that continued registration of
non-household goods freight forwarders under 49 U.S.C. 13903 and non-
household goods brokers under 49 U.S.C. 13904 is needed for the
protection of shippers. We also note that brokers and freight
forwarders must register pursuant to 49 U.S.C. 13901 to engage in
interstate transportation. Finally, based on FMCSA's determination
above regarding the protection of shippers, any registration
appropriately filed between August 10, 2005 (the date of enactment of
SAFETEA-LU) and the date of this Notice shall be effective on the date
the registration was approved by FMCSA.
Issued on: August 16, 2006.
John H. Hill,
Administrator.
[FR Doc. E6-14064 Filed 8-23-06; 8:45 am]
BILLING CODE 4910-EX-P
