General Jurisdiction Over Freight Forwarder Service, 15388-15394 [E9-7639]

Agencies

• Federal Motor Carrier Safety Administration
• DEPARTMENT OF TRANSPORTATION

[Federal Register Volume 74, Number 64 (Monday, April 6, 2009)]
[Rules and Regulations]
[Pages 15388-15394]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-7639]


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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

49 CFR Part 373

[Docket No. FMCSA-1997-2290]
RIN 2126-AA25


General Jurisdiction Over Freight Forwarder Service

AGENCY: Federal Motor Carrier Safety Administration (FMCSA), DOT.

ACTION: Final rule.

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SUMMARY: The Federal Motor Carrier Safety Administration (FMCSA) amends 
its regulations to require all surface freight forwarders to issue a 
receipt or bill of lading on each shipment for which they arrange 
transportation of freight by commercial motor vehicle in interstate 
commerce. This regulatory change implements amendments enacted in the 
ICC Termination Act of 1995 (ICCTA). While the current rule concerning 
receipts or bills of lading applies only to household goods freight 
forwarders, the new rule applies to both household goods and non-
household goods freight forwarders.

DATES: Effective May 6, 2009.

FOR FURTHER INFORMATION CONTACT: Mr. David Miller, Telephone: (202) 
366-5370, E-mail address: FMCSAregs@dot.gov.

Availability of Rulemaking Documents

    For access to docket FMCSA-1997-2290 to read background documents 
and comments received, go to https://www.regulations.gov at any time or 
to U.S. Department of Transportation, Room W12-140, 1200 New Jersey 
Ave., SE., Washington, DC 20590, between 9 a.m. and 5 p.m., Monday 
through Friday, except Federal holidays.
    Privacy Act: Anyone is able to search the electronic form of all 
comments received into any of DOT's dockets by the name of the 
individual submitting the comment (or signing the comment, if submitted 
on behalf of an association, business, labor union, etc.). You may 
review DOT's complete Privacy Act Statement in the Federal Register 
published on April 11, 2000 (65 FR 19477). This statement is also 
available at https://www.regulations.gov.

SUPPLEMENTARY INFORMATION: 

I. Legal Basis for the Rulemaking

    This final rule is based on the authority of the ICCTA (Pub. L. 
104-88, 109 Stat. 803, Dec. 29, 1995). The ICCTA gave the Secretary of 
Transportation (Secretary) general jurisdiction over all freight 
forwarder service involving transportation in interstate commerce under 
49 U.S.C. 13531. Under 49 U.S.C. 13301(a), the Secretary is authorized 
to issue regulations to carry out the provisions of the ICCTA 
applicable to motor carriers, brokers, and freight forwarders.
    Under 49 U.S.C. 14706(a), motor carriers and freight forwarders 
providing transportation or service subject to the Secretary's 
jurisdiction must issue a receipt or bill of lading for property 
received for transportation. These entities are liable for loss of, or 
damage to, the property described in the receipt or bill of lading.
    The statutory requirement to provide a receipt or bill of lading 
was implemented in order for claimant parties (shippers) to make a 
prima facie case against motor carriers and freight forwarders under 
the Carmack amendment.\1\ A receipt or bill of lading provides evidence 
that goods were delivered to the carrier or freight forwarder. If goods 
are damaged, the receipt or bill of lading can specify the monetary 
value of the cargo, i.e., the loss resulting from damage.
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    \1\ The Carmack amendment to the Interstate Commerce Act was 
passed in 1906 as part of the Hepburn Act, ch. 5391, 34 Stat. 584. 
It established uniform liability procedures for goods transported in 
interstate commerce. Its terms are now found at 49 U.S.C. 14706.
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    Part 370 of title 49, Code of Federal Regulations (CFR) (formerly 
49 CFR part 1005), sets forth the principles and practices for the 
investigation and voluntary disposition of claims for loss, damage, 
injury, or delay to cargo handled by motor carriers and freight 
forwarders. It implements the Carmack amendment, as does 49 CFR part 
373 pertaining to the issuance of receipts and bills of lading by motor 
carriers and freight forwarders.

[[Page 15389]]

    This final rule harmonizes 49 CFR 373.201, entitled ``Bills of 
lading for freight forwarders,'' with the statutory requirements of the 
ICCTA. It revises 49 CFR 373.201 to include the general commodities 
segment of the freight forwarding industry within its scope. This 
revision is consistent with the receipt or bill of lading requirements 
imposed on all freight forwarders by 49 U.S.C. 14706(a).
    A more recent legislative provision affecting the freight 
forwarding industry, section 4142 of the Safe, Accountable, Flexible, 
Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) 
(Pub. L. 109-59, 119 Stat. 1144, Aug. 10, 2005), authorized the 
Secretary to continue registering general commodities freight 
forwarders if ``[t]he Secretary finds [(1)] that such registration is 
needed for the protection of shippers and [(2)] that the person is fit, 
willing, and able to provide the service and to comply with this part 
and applicable regulations.'' The Agency found that registration of 
general commodities freight forwarders is needed for the protection of 
shippers (see 71 FR 50115, Aug. 24, 2006). This finding reaffirmed the 
ICCTA mandate requiring FMCSA to register all freight forwarders. Thus, 
the FMCSA continues to register all general commodities freight 
forwarders subject to its jurisdiction and to require procedures 
necessary for the protection of shippers.
    In addition, section 4303(c) of SAFETEA-LU directed FMCSA to 
eliminate the distinction between motor common or contract carriers in 
registration. Thus, FMCSA makes a technical correction to the existing 
rule to eliminate the word ``common'' from within its scope.

II. Background

    In January 1997, the Federal Highway Administration (FHWA), the 
predecessor agency to FMCSA within the DOT, issued a notice of proposed 
rulemaking (NPRM) (62 FR 4096, Jan. 28, 1997) to amend 49 CFR 373.201, 
under the then existing heading ``Bills of Lading for Freight 
Forwarders.'' The NPRM proposed to require that all freight forwarders, 
not just household goods freight forwarders, issue a receipt or bill of 
lading for the transportation of each shipment they arrange for 
transportation in interstate commerce.
    As proposed in the NPRM, this final rule amends 49 CFR 373.201, 
first by retitling it ``Receipts and bills of lading for freight 
forwarders,'' and then by including within its scope all segments of 
the freight forwarding industry. This regulation implements the 
statutory requirement for issuing a receipt or bill of lading imposed 
on all freight forwarders by 49 U.S.C. 14706(a).
    The term freight forwarder is defined at 49 U.S.C. 13102(8) as 
follows:

    * * * a person holding itself out to the general public (other 
than as a pipeline, rail, motor, or water carrier) to provide 
transportation of property for compensation and in the ordinary 
course of its business--
    (A) assembles and consolidates, or provides for assembling and 
consolidating, shipments and performs or provides for break-bulk and 
distribution operations of the shipments;
    (B) assumes responsibility for the transportation from the place 
of receipt to the place of destination; and
    (C) uses for any part of the transportation a carrier subject to 
jurisdiction under this subtitle.
    The term does not include a person using transportation of an 
air carrier subject to part A of subtitle VII [of title 49, U.S.C.].

History

    This rulemaking has a long history, which was explained in detail 
in the NPRM. The Surface Freight Forwarder Deregulation Act of 1986 
(Pub. L. 99-521, 100 Stat 2993, Oct. 22, 1986) (the Deregulation Act), 
substantially deregulated the general commodities segment of the 
freight forwarding industry, but it retained the regulation of freight 
forwarders that service the transportation of household goods.
    To implement pertinent provisions of the Deregulation Act, the 
former ICC made minor revisions in the CFR to exclude general 
commodities freight forwarders from the scope of most ICC rules 
applicable to freight forwarders. See Ex Parte No. MC-184, Regulation 
of Household Goods Freight Forwarders Under the Surface Freight 
Forwarder Deregulation Act of 1986, 3 I.C.C. 2d 162 (1986). In its 1986 
rulemaking, the ICC did not revise the regulations for the issuance of 
bills of lading (former 49 CFR part 1081, now redesignated as 49 CFR 
part 373, subpart B) \2\ to exclude general commodities freight 
forwarders from their scope because the ICC determined ``[t]he Carmack 
amendment requires all carriers and freight forwarders to issue bills 
of lading for property they receive (49 U.S.C. 11707(a)(1)) and is 
central to its liability provisions.'' See 3 I.C.C. 2d 162 at 166 
(1986).
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    \2\ Title 49 CFR part 1081 was redesignated as 49 CFR part 373, 
subpart B, on October 21, 1996 (61 FR 54706).
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    In 1990, the ICC issued a final rule (Practice and Procedure--Misc. 
Amendments--Revisions, 6 I.C.C. 2d 587 (1990)), which amended former 49 
CFR 1081.1 to require only household goods freight forwarders to issue 
bills of lading. The ICC did not explain why it was making this change, 
in light of its recognition in the 1986 rulemaking proceeding that 
general commodities freight forwarders were still subject to Carmack 
amendment requirements. Whatever the reason for the regulatory change, 
the underlying statutory requirement that all freight forwarders issue 
receipts or bills of lading for property they receive or deliver for 
transportation in interstate commerce remains unchanged.
    Then, in 1995, ICCTA, at 49 U.S.C. 13531, re-established the 
Secretary's jurisdiction over all segments of the freight forwarding 
industry. This jurisdiction included the requirement that general 
commodities freight forwarders must register to operate in interstate 
commerce.

III. Discussion of Comments to the NPRM

    In response to the January 28, 1997, NPRM, FMCSA received 11 
comments from freight forwarding entities, trucking companies, shippers 
and the Advocates for Highway and Auto Safety (Advocates).\3\ The 
following commenters agree with the original proposal to amend part 
373. The Health and Personal Care Distribution Conference, Inc., and 
National Small Shipments Traffic Conference, Inc., note that the change 
to 49 CFR 373.201 is necessary to ``remove an inconsistency in the 
regulation.'' Freight Forwarders Council, Transportation 
Intermediaries, and Advocates also offer qualified support for the rule 
change.
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    \3\ The Agency received comments from Freight Forwarders Council 
of America, Inc. (Freight Forwarders Council); Health and Personal 
Care Distribution Conference, Inc.; MRS Freight Forwarding Services, 
Inc. (MRS); William J. Monheim, STB Practitioner (Monheim); National 
Small Shipments Traffic Conference, Inc.; Transportation 
Intermediaries Association (Transportation Intermediaries); William 
J. Tucker, CTB, president of Tucker Company (Tucker); Unisource 
Transportation Services, Inc. (Unisource); and the Advocates. The 
Health and Personal Care Distribution Conference, Inc. and National 
Small Shipments Traffic Conference, Inc. submitted joint comments 
through counsel. MRS and Unisource submitted nearly identical sets 
of comments.
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    In contrast, Monheim, MRS, Unisource, and Tucker oppose the 
proposed amendment to part 373.

Comments About ICCTA Provisions Unrelated to Freight Forwarders

    In the preamble to the NPRM, the Agency provided information about 
a number of new requirements of the ICCTA to help make the public aware 
of the statutory changes. Those discussions were informational only and 
were not intended to be the basis for this regulatory action. However, 
a

[[Page 15390]]

substantial percentage of the comments to the docket focused on those 
informational discussions.
    FMCSA acknowledges the concerns of the commenters, but their 
comments about the informational discussions do not have any bearing on 
the substance of the original proposal. Thus, the remainder of the 
discussion in the preamble to FMCSA's final rule will focus on the 
data, information, and comments related to the Agency's proposal 
concerning freight forwarder receipts and bills of lading.

Response to Comments

    The objections are grouped into five categories: A) jurisdictional 
boundaries of the Agency over freight forwarders; B) flexible nature of 
freight forwarding operations and the extent to which this should be 
reflected in Sec.  373.201; C) purpose, scope, and contents of the 
receipt or bill of lading; D) role of the bill of lading with respect 
to the liability provisions of the Carmack amendment (49 U.S.C. 14706); 
and E) other issues of interest. Comments are discussed under these 
categories below.

A. Jurisdictional Boundaries

    Necessity for a Rule. MRS and Unisource set forth a number of 
arguments against bringing general commodities freight forwarders under 
the Secretary's jurisdiction. MRS and Unisource contend that because 
the freight forwarding industry neither abuses market power nor 
conducts its operations in ways contrary to the public interest, it 
should not be burdened with additional regulations and should be 
exempted under 49 U.S.C. 13541. Further, they state that the proposed 
change to Sec.  373.201 is unnecessary because 49 CFR 1035.1 already 
requires all common carriers to issue bills of lading. They add that 
the requirement to issue bills of lading also is promulgated at 49 CFR 
373.101, 373.103, and 373.105.
    FMSCA Response. This rulemaking proceeding is not the proper forum 
for seeking an exemption under section 13541. A specific request for an 
exemption would have to be filed with the Agency in order to obtain 
such relief. In any event, under 49 U.S.C. 13541, FMCSA (pursuant to 
authority delegated by the Secretary) already concluded in August 2006 
that continued registration of general freight forwarders is needed to 
protect shippers (71 FR 50115, Aug. 24, 2006).
    The FMCSA disagrees with MRS and Unisource's contention that the 
proposed change to Sec.  373.201 is unnecessary. Part 1035 applies to 
rail and water carriers only, i.e., it does not include motor carriers. 
While Sec. Sec.  373.101, 373.103, and 373.105 apply to motor carriers, 
they do not apply to freight forwarders.
    Consolidating Station in Terminal Area. MRS and Unisource state 
that, if a freight forwarder maintains a consolidating station in a 
terminal area, then 49 U.S.C. 13503(a)(1)(B)(iii) exempts the forwarder 
from the Agency's jurisdiction when conducting business at its 
consolidating station.
    FMCSA Response. FMCSA agrees with MRS and Unisource that local 
transfer, collection, or delivery service provided by a freight 
forwarder in a terminal area continues to be exempt from the 
Secretary's jurisdiction under 49 U.S.C. 13503(a)(1)(B). However, this 
does not exempt the freight forwarder from providing a receipt or bill 
of lading for property it receives or delivers for regulated 
transportation, since this requirement applies to those services 
performed outside the terminal area. A receipt or bill of lading issued 
inside a terminal area has full validity for regulated transportation 
outside the terminal area and in commerce. The requirement to issue a 
receipt or bill of lading depends on whether the transportation of 
those goods is regulated, not on where the receipt or bill of lading is 
issued. A freight forwarder performing assembly or consolidating 
services, or any variation on such services, is required under 49 
U.S.C. 14706(a) to issue a receipt or bill of lading or provide its 
consent to the carrier to do so.
    Applicability of Sec.  373.201. MRS and Unisource question whether 
Sec.  373.201 would be applicable in certain cases, and they give 
examples. They state that there are instances when the motor carrier, 
and not the freight forwarder, consolidates the freight being 
transported. They assert that the applicability of Sec.  373.201 
depends on the circumstances involved.
    FMCSA Response. FMCSA agrees there are instances when the motor 
carrier, and not the freight forwarder, consolidates the freight being 
transported. A motor carrier providing consolidating services on behalf 
of the freight forwarder may obtain the freight forwarder's consent to 
issue the receipt or bill of lading. If, with the consent of the 
freight forwarder, the motor carrier issues the required receipt or 
bill of lading on behalf of the freight forwarder or delivers property 
for a freight forwarder on the freight forwarder's bill of lading, the 
freight forwarder has complied with Sec.  373.201.

B. The Flexible Nature of Freight Forwarding Operations, and the Extent 
To Which This Should Be Reflected in Sec.  373.201

    Applicability of the Definition of Freight Forwarder. Tucker 
criticizes the NPRM preamble for using the statutory definition for the 
term freight forwarder.
    FMCSA Response. FMCSA does not have the discretion to alter the 
statutory definition for the term freight forwarder. Although we 
recognize it may not convey fully the diverse services provided by 
agents who choose to represent themselves as freight forwarders today, 
FMCSA is required to use the statutory definition for freight 
forwarders.
    Flexibility. Freight Forwarders Council, MRS, Unisource, Monheim, 
Tucker, and Transportation Intermediaries each asserts that freight 
forwarding operations have become increasingly flexible and diversified 
in response to changing market conditions. Several of these commenters 
also object to portions of the NPRM preamble language that they believe 
ignore these operational realities.
    FMCSA Response. This final rule does not contradict the principle 
of economic deregulation that was reaffirmed in the ICCTA, nor does 
this action undermine the fundamental diversity and nature of freight 
forwarder operations. Regardless of whether a freight forwarder 
actually performs a particular service or provides for that service to 
be performed by someone else, it must assume legal responsibility for 
the transportation from the place of receipt to the place of 
destination. Consequently, a freight forwarder is still required to 
issue a receipt or bill of lading pursuant to 49 U.S.C. 14706.

C. The Purpose, Scope, Form, and Contents of the Receipt or Bill of 
Lading

    Format and Contents of the Bill of Lading. Five commenters offered 
suggestions on the content of bills of lading. Freight Forwarders 
Council suggested that FMCSA use a model bill of lading, while 
Advocates recommended stamping the bill of lading with reliable dates 
and with departure and arrival/delivery times. Transportation 
Intermediaries wanted to develop uniformly accepted transportation 
documentation.
    FMCSA Response. There is a significant difference between the 
receipt and bill of lading requirements in Sec.  373.101, which specify 
information that must be contained on the motor carrier's receipt or 
bill of lading, and those of Sec.  373.201 that apply to freight 
forwarders. Section 373.201 only

[[Page 15391]]

requires that a freight forwarder issue a receipt or bill of lading, 
covering transportation from origin to ultimate destination, on each 
shipment for which it arranges transportation in interstate commerce. 
Section 373.201 does not specify what information must be contained on 
the receipt or bill of lading or prescribe the format of these 
documents. The Agency does not approve or recommend any particular 
model receipt or bill of lading for freight forwarders to use in their 
operations, and the form and content of these documents is beyond the 
scope of this final rule.
    Practicality of Requiring a Receipt or Bill of Lading. MRS and 
Unisource believe that imposing a requirement for general commodities 
freight forwarders to issue a second receipt or bill of lading, in 
addition to one issued by the motor carrier that picks up the shipment, 
is impractical and creates confusion for the freight forwarding 
industry.
    FMCSA Response. The issuance of a receipt or bill of lading is a 
long-standing practice observed by the entire freight forwarding 
industry and is required by statute. Consequently, FMCSA believes most 
parties to a freight forwarding transaction will not be confused or 
burdened by this requirement.

D. Role of the Bill of Lading With Respect to the Liability Provisions 
of the Carmack Amendment (49 U.S.C. 14706)

    Bill of Lading Not Necessary. Three commenters assert that it is no 
longer necessary for freight forwarders to issue bills of lading. 
Tucker believes that this rule change will not benefit freight 
forwarders or customers because, in his view, the liability protections 
provided by the Carmack amendment flow from a prior contract of 
carriage and not the bill of lading. Transportation Intermediaries 
similarly asserts that, under section 14101(b), bills of lading are not 
necessary since freight forwarders and shippers may mutually ``waive 
any or all rights and remedies under this part for the transportation 
covered by contract.'' Monheim asserts that ICCTA abolished the 
distinction between common and contract carriers, allowing freight 
forwarders to exercise the contract authority provided under section 
14101(b). Monheim comments that the provisions of the Bills of Lading 
Act no longer apply to freight forwarders.
    FMCSA Response. The liability provisions of the Carmack amendment, 
codified at 49 U.S.C. 14706, apply to all transportation under the 
jurisdiction of the Secretary. Motor carriers and freight forwarders 
providing transportation or service are liable to the ``person entitled 
to recover [compensation for loss or damage to the property] under the 
receipt or bill of lading.'' Section 14706(a) makes it clear that 
failure to issue a receipt or bill of lading does not change the 
liability of the carrier. In addition, section 14706(a) does not 
require a prior contract of carriage to tie in the Carmack liability 
provisions. Whether the statute is recognized in the marketplace is 
immaterial because the section 14706 liability provisions apply to 
receipts and bills of lading. Although a contract of carriage would 
indeed take precedence in a court of law over a receipt or bill of 
lading containing no contractual terms, the receipt or bill of lading 
nonetheless carries legal force and effect under the general liability 
provisions of section 14706(a).
    Finally, the assertion that a receipt or bill of lading is no 
longer required because of 49 U.S.C. 14101(b) is not correct. That 
provision enables carriers subject to chapter 135 of title 49 U.S.C. 
(including general commodities freight forwarders) to enter into 
contracts of carriage that could potentially waive any or all rights 
covered by the contract, with certain exceptions not pertinent to this 
rule. However, the option of waiving the receipt or bill of lading 
requirement is not reason enough to forego imposing it, since not 
everyone will choose to waive the requirement.
    Rule Change is Impractical. Unisource contends that FMCSA's 
proposed amendment to Sec.  373.201 will be impractical; cause 
confusion among shippers, motor carriers, dispatchers, and freight 
forwarders; and raise questions about liability. It asks, for example, 
if a freight forwarder would be liable for a shipment that was lost or 
damaged before it was received merely because its name is on the bill 
of lading.
    FMCSA Response. The issue Unisource raises would be determined 
under contract law, other case law, and circumstantial evidence. If a 
forwarder has not physically accepted a shipment, the forwarder would 
not be liable--that is, would not be required to accept legal 
responsibility for the loss or damage--merely because its name is on 
the bill of lading, unless the contract of carriage specified 
otherwise.

E. Other Issues of Interest

    The NPRM is Misleading. Monheim contends that the NPRM is 
misleading with regard to a State's role in regulating freight 
forwarders. Unless the carrier specifically requests that a State's 
regulations apply to the carrier, Monheim believes that the States are 
completely removed from any regulation of freight forwarders for rates, 
routes or services, including bills of lading.
    FMCSA Response. The NPRM merely stated that, under 49 U.S.C. 
chapter 145, Federal preemption of general commodities freight 
forwarders was narrowed in several respects. Chapter 145 allows States 
to regulate freight forwarders' intrastate activities in these areas if 
compliance is no more burdensome than interstate compliance under 
Federal law.
    Paragraphs (b) and (c) of 49 U.S.C. 14501 prohibit State regulation 
of intrastate rates, intrastate routes, and intrastate services of 
freight forwarders of property; but they make a partial exception for 
uniform cargo liability rules, uniform bills of lading or receipts, 
uniform cargo credit rules, and certain antitrust immunity. No other 
distinction was intended here.
    Significance of this Final Rule. Tucker challenges the NPRM's 
estimate that the rule will have an annual effect on the general 
commodities segment of the freight forwarding industry of less than 
$100 million. He contends the Agency has no basis for assuming that the 
ratio of general commodities freight forwarders to household goods 
freight forwarders is essentially the same today as in 1986.
    Unisource believes that the rule would place a significant 
unnecessary burden on shipments made via a general commodities freight 
forwarder, versus those placed on other modes of transportation.
    FMCSA Response. The cost impact analysis in the NPRM assumed the 
same ratio of general commodities freight forwarders to household goods 
freight forwarders of 8.4 to 1 as in 1986, when the Deregulation Act 
was enacted. The ratio has decreased considerably since then. The 
analysis set forth below updates this information.
    As of November 2007, the last complete year of available data, 
there were 1,402 active entities on file at FMCSA in the Licensing and 
Insurance (L&I) information system that identified themselves to FMCSA 
as freight forwarders.\4\ Of these, 1,117 identified themselves as 
general commodities freight forwarders; and 285 identified themselves 
as household goods freight forwarders. This is a ratio of approximately 
3.9 to 1 of general commodities freight forwarders to household goods 
freight forwarders. This considerable drop from the 1986 ratio of 8.4 
to 1 may indicate that some

[[Page 15392]]

general commodities freight forwarders are choosing to represent 
themselves as brokers.
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    \4\ All freight forwarders--general commodities and household 
goods--are required to register with FMCSA for their operating 
authority.
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    Regarding the economic impact of this rule, the issuance of 
receipts or bills of lading by freight forwarders--including general 
commodities freight forwarders--is a well-established business 
practice. In the words of the Freight Forwarders Council:

    All forwarders today issue bills of lading, so no change will be 
caused by the adoption of the proposed regulations. Not to issue a 
bill of lading violates [the] Federal statute [at] 49 U.S.C. 
14706(a).
    [See docket item FMCSA-1997-2290-0005-0001]

    Since forwarders have for many years been required to issue 
receipts or bills of lading, there should be no significant increase in 
cost by making 49 CFR 373.201 conform to the long-standing statutory 
requirement. Thus, a requirement for general commodities freight 
forwarders to issue a receipt or bill of lading will not, in the 
aggregate, generate an economic burden or create a major increase in 
costs or prices or have a significant adverse effect on any sector of 
the industry. FMCSA's issuance of this final rule merely reestablishes 
the consistency between statutory and regulatory requirements.

Regulatory Analyses and Notices

Executive Order 12866 (Regulatory Planning and Review) and DOT 
Regulatory Policies and Procedures

    FMCSA has determined that this action is not a significant 
regulatory action within the meaning of Executive Order 12866 or within 
the meaning of the U.S. Department of Transportation's regulatory 
policies and procedures. It is anticipated that the economic impact of 
this final rule will be minimal.
    A receipt or bill of lading is a document that lies at the heart of 
every transportation transaction. It documents a bilateral agreement 
under which both sides make guarantees. The requirement for all freight 
forwarders to issue a receipt or bill of lading for property they 
transport has been in effect by statute since 1942 and by regulation 
until 1990, when the former ICC changed its regulations to limit the 
requirement to household goods freight forwarders. Based on comments 
from the Freight Forwarders Council and verification checks made for 
FMCSA (as discussed in footnote 5), it appears it is a usual and 
customary practice for most general commodities and household goods 
freight forwarders to issue such a document in the normal course of 
doing business.
    This rule revises 49 CFR 373.201 to include general commodities 
freight forwarders within the scope of the FMCSA's receipt and bill of 
lading regulation, as required by 49 U.S.C. 14706. This action requires 
that all parties to a transportation transaction be given documentation 
of their shipping arrangement. The FMCSA has evaluated the economic 
impact of the proposed changes on the general commodities freight 
forwarding segment of the industry and determined that the rule change 
is within the statutory mandate, and is reasonable, appropriate, and 
does not impose significant costs to the general commodity segment of 
the freight forwarding industry.
    This final rule removes any uncertainty with respect to which 
freight forwarders are required to issue a receipt or bill of lading 
for property they accept for transportation in interstate commerce. 
Given that most general commodities freight forwarders already issue a 
receipt or bill of lading, FMCSA anticipates none of these freight 
forwarders will expend any additional effort and resources to comply 
with amended Sec.  373.201.\5\
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    \5\ After reviewing the comments to the proposed rule and 
conducting a literature search on the issuance of bills of lading by 
freight forwarders, FMCSA concluded that as a usual and customary 
practice freight handed over to a carrier was accompanied by a 
receipt or bill of lading. To confirm this, FMCSA attempted to 
contact some firms in the industry and the trade associations who 
submitted comments to the proposed rule. Calls were made on August 
9, 2006, to: Transportation Intermediaries; Powers Freight Express 
of Lynbrook, New York; York Services, Inc. of York, Pennsylvania; 
and Patron Services, Inc. of Baltimore, Maryland. Each indicated 
that they believed most freight forwarders issue receipts or bills 
of lading in the normal course of doing business.
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    Consequently, FMCSA does not believe this final rule will have an 
annual effect on the general commodities freight forwarder segment of 
the forwarding industry of $100 million or more, lead to a major 
increase in costs or prices, or have a significant adverse effect on 
any sector of the economy. Thus, requiring all freight forwarders to 
comply with this final rule to provide a receipt or bill of lading will 
not significantly impact the industry.
    The Agency is not required to prepare a stand-alone Regulatory 
Analysis. However, because of the concern expressed by some commenters 
that there might be a large impact, the Agency has prepared one to 
fully explain the costs and benefits of this rulemaking action. A copy 
of the analysis is included in the docket (FMCSA-1997-2290).

Regulatory Flexibility Act

    In compliance with the Regulatory Flexibility Act (Pub. L. 96-354, 
5 U.S.C. 601-612), FMCSA has evaluated the effects of this rule on 
small entities, which comprise well above 50 percent of the freight 
forwarding industry, and has determined that this final regulatory 
action will not have a significant impact on a substantial number of 
small entities.
    One reason this action does not have a significant impact on 
general commodities freight forwarders is that they have been required 
by statute to issue receipts and bills of lading since 1942. In 1990, 
the ICC removed this requirement from its regulations, notwithstanding 
the statutory requirement. This rule reestablishes in 49 CFR 373.201 
this long standing statutory requirement that all freight forwarders 
are required to issue receipts or bills of lading for the 
transportation they arrange in interstate commerce.
    Based on all information available to the Agency, including 
comments from Freight Forwarders Council and FMCSA checks of industry 
practices, the Agency believes that most freight forwarders have, for 
many years, been aware of this statutory requirement. Issuing a receipt 
or bill of lading is a well established, usual and customary business 
practice of general commodities freight forwarders and the industry as 
a whole. Accordingly, the practical consequence of today's final rule 
for the vast majority of freight forwarders is negligible.
    The small minority of general commodities freight forwarders not 
already providing a receipt or bill of lading as legal documentation 
will now be required by regulation, as well as statute, to issue such a 
document. To the limited extent that this rule may result in 
incremental increases in compliance with the receipt or bill of lading 
requirements, the public, freight forwarders, and their customers alike 
will benefit from this requirement. In particular, small entities that 
rely on general commodities freight forwarder service will benefit from 
the Agency requiring general commodities forwarders to provide a 
receipt or bill of lading establishing legal documentation for any 
loss, damage, or injury to the property that may be transported after 
the freight forwarder takes possession of the goods tendered.
    Commenters have not presented any information to suggest or 
convince us that there will be a significant economic impact on the 
general commodities freight forwarder industry by promulgation of this 
final rule. This final rule merely mandates that they be

[[Page 15393]]

in compliance with the long-standing statutory requirement and perform 
what is already the industry's usual and customary business practice--
namely, to issue a receipt or bill of lading for the property for which 
they arrange transportation in interstate commerce.

Executive Order 13132 (Federalism)

    FMCSA analyzed this rule in accordance with the principles and 
criteria contained in Executive Order 13132. FMCSA has determined that 
this rulemaking will not have a substantial direct effect on States, 
nor will it limit the policy-making discretion of the States. Nothing 
in this document will preempt any State law or regulation. FMCSA has 
therefore determined this rule does not have sufficient federalism 
implications to warrant the preparation of a federalism assessment.

Executive Order 12372 (Intergovernmental Review)

    The regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities do 
not apply to this program.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520) 
requires that FMCSA consider the impact of paperwork and other 
information collection burdens imposed on the public. As noted above, 
the practice of issuing receipts or bills of lading for cargo 
transported is a well established, usual and customary business 
practice of all freight forwarders. Therefore, FMCSA believes the 
paperwork reduction exception for usual and customary business practice 
applies in this case. Thus, this action does not involve an information 
collection that is subject to the requirements of the PRA.

National Environmental Policy Act

    The Agency analyzed this final rule for the purpose of the National 
Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321 et seq.) and 
determined under our environmental procedures Order 5610.1, published 
March 1, 2004, in the Federal Register (69 FR 9680), that this action 
has a categorical exclusion (CE) under Appendix 2, paragraph 6.l. of 
the Order from further environmental documentation. That CE relates to 
establishing regulations, and actions taken pursuant to these 
regulations, concerning motor carrier's issuance and retention of bills 
of lading. In addition, the Agency believes that this action involves 
no extraordinary circumstances that would have any effect on the 
quality of the environment. Thus, the action does not require an 
environmental assessment or an environmental impact statement.
    The Agency has also analyzed this final rule under the Clean Air 
Act, as amended (CAA) section 176(c), (42 U.S.C. 7401 et seq.) and 
implementing regulations promulgated by the Environmental Protection 
Agency. Approval of this action is exempt from the CAA's general 
conformity requirement since it involves rulemaking action. (See 40 CFR 
93.153(c)(2)(iii).) It will not result in any emissions increase nor 
would it have any potential to result in emissions that are above the 
general conformity rule's de minimis emission threshold levels. 
Moreover, it is reasonably foreseeable that this final rule will not 
increase total commercial motor vehicle (CMV) mileage, nor will it 
change the routing of CMVs, how CMVs operate, or the CMV fleet-mix of 
motor carriers. By this action, FMCSA merely updates its existing 
regulation at Sec.  373.201 to require that all freight forwarders 
issue receipts or bills of lading consistent with statutory 
requirements.

Executive Order 12898 (Environmental Justice)

    FMCSA evaluated the environmental effects of this final rule in 
accordance with Executive Order 12898 and determined that there are no 
environmental justice issues associated with its provisions nor any 
collective environmental impact resulting from its promulgation.

Unfunded Mandates Reform Act of 1995

    This rulemaking will not impose an unfunded Federal mandate, as 
defined by the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1532, et 
seq.), that will result in the expenditure by State, local, and tribal 
governments, in the aggregate, or by the private sector, of $136.1 
million or more in any one year.

Executive Order 12630 (Taking of Private Property)

    This final rule does not effect a taking of private property or 
otherwise have taking implications under Executive Order 12630, 
Governmental Actions and Interference with Constitutionally Protected 
Property Rights.

Executive Order 13211 (Energy Supply, Distribution, or Use)

    The FMCSA analyzed this action under Executive Order 13211, Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use. We determined that it is not a ``significant 
energy action'' under that Executive Order because it will not be 
likely to have a significant adverse effect on the supply, 
distribution, or use of energy.

Executive Order 12988 (Civil Justice Reform)

    This action meets applicable standards in sections 3(a) and 3(b)(2) 
of Executive Order 12988, Civil Justice Reform, to minimize litigation, 
eliminate ambiguity, and reduce burden.

Executive Order 13084 (Consultation and Coordination With Indian Tribal 
Governments)

    This final rule has been analyzed in accordance with the principles 
and criteria contained in Executive Order 13084. Because this rule does 
not significantly or uniquely affect the communities of the Indian 
tribal governments, the funding and consultation requirements of this 
Executive Order do not apply.

Executive Order 13045 (Protection of Children)

    The FMCSA analyzed this proposed action under Executive Order 
13045, Protection of Children from Environmental Health Risks and 
Safety Risks. The FMCSA determined that this rulemaking does not 
concern an environmental risk to health or safety that may 
disproportionately affect children.

Privacy Impact Assessment

    The FMCSA conducted a privacy impact assessment of this proposed 
rule as required by section 522(a)(5) of division H of the Fiscal Year 
(FY) 2005 Omnibus Appropriations Act, Public Law 108-447, 118 Stat. 
3268 (December 8, 2004) [set out as a note to 5 U.S.C. 552a]. The 
assessment determined there are no privacy information impacts.

List of Subjects in 49 CFR Part 373

    Bills of lading, Highway safety, Highways and roads, Motor 
carriers.

0
For the reasons set forth above, FMCSA amends chapter III of title 49 
CFR as follows:

PART 373--RECEIPTS AND BILLS

0
1. Revise the authority citation for part 373 to read as follows:

    Authority: 49 U.S.C. 13301, 13531 and 14706; and 49 CFR 1.73.


0
2. Revise Sec.  373.201 of subpart B to read as follows:

[[Page 15394]]

Sec.  373.201  Receipts and bills of lading for freight forwarders.

    Each freight forwarder must issue the shipper a receipt or through 
bill of lading, covering transportation from origin to ultimate 
destination, on each shipment for which it arranges transportation in 
interstate commerce. Where a motor carrier receives freight at the 
origin and issues a receipt therefor on its form with a notation 
showing the freight forwarder's name, then the freight forwarder, upon 
receiving the shipment at the ``on line'' or consolidating station, 
must issue a receipt or through bill of lading on its form as of the 
date the carrier receives the shipment.

    Issued on: March 30, 2009.
Rose A. McMurray,
Acting Deputy Administrator.
 [FR Doc. E9-7639 Filed 4-3-09; 8:45 am]
BILLING CODE 4910-EX-P