FMCSA publishes final rule addressing `reincarnated` carriers
05/02/2012 - 11:46:20 am
FMCSA amended some of its administrative procedures, published in a rulemaking this past week, aiming to make life more difficult for companies with repeated safety violations that simply reincarnate into new trucking businesses.
Beginning May 29 the FMCSA will have procedures in place to issue out-of-service orders to carriers who have a history of violations, thanks to the new regulation.
In the rule, FMCSA amended its procedures for intermodal equipment providers, motor carriers, freight forwarders and brokers. Companies that pay a full civil penalty during an enforcement proceeding can’t unilaterally avoid an admission of liability. The rule also means FMCSA can consolidate records for companies that reincarnate.
“These procedures more fully implement the Agency’s current authority to prohibit unsafe entities from operating while, at the same time, providing due process for companies that seek to challenge a finding that they are reincarnated,” FMCSA wrote in the Federal Register.
Of particular note in the regulation, motor carriers will no longer be able to pay a “notice of claim,” basically a civil penalty for noncompliance, without admitting guilt. The only way a motor carrier can pay a notice of claim without the admission of guilt is if an agreement with FMCSA is struck in advance.
In comments published in the Federal Register, OOIDA requested that FMCSA add a subsection to address carriers that reincarnate with the intent of not paying liabilities to truck drivers, including OOIDA members who actually provide transportation services. FMCSA said such a subsection was “outside the scope of the current rulemaking.”
OOIDA also commented that FMCSA’s DataQ dispute resolution process doesn’t allow due process to carriers and drivers. FMCSA said the rule in question was limited to the notice of claim resolution process.
FMCSA also established procedures for issuing out-of-service orders for motor carriers, intermodal equipment providers, brokers and freight forwarders it determines are “reincarnations of other entities with a history of failing to comply with statutory or regulatory requirements.
Citing the need for reforms, the agency cited a 2008 bus crash in Sherman, TX, in which 17 passengers of a bus chartered by Vietnamese pilgrims were killed. The bus company didn’t have authority, but had an application pending with FMCSA, and had reincarnated after the agency put it out-of-service for safety violations.
By Charlie Morasch, Land Line Magazine contributing writer