News / Intermediaries slam call for more haulage contract and price disclosure

Photo: © Valentin Balan | Dreamstime.com

The US Transportation Intermediaries Association (TIA) has blasted proposed rules for freight brokers to disclose more information on contracts and pricing as an outdated move that would jeopardise the survival of small companies and destabilise supply chains.

The TIA fired its comments at the US Senate as it considers the proposals by the Federal Motor Carrier Safety Administration (FMCSA), which aims to combat rising fraud in freight brokerage.

The proposals were developed in response to a petition from the Owner-Operator Independent Drivers Association and other interest groups, alarmed over fraud.

It would mean brokers must provide transaction information within 48 hours of completion of a service, and would have to keep transaction records in electronic format and make them accessible upon request.

The TIA, which represents transport intermediaries across all modes, agrees brokerage fraud is a rising problem that must be addressed. It published a report in April which found “unlawful brokering scams continue to top the list of threats”, and called it “an evolving threat at unprecedented levels”.

However, the TIA sees little merit on the security side in the FMCSA proposals. It wants lawmakers to instead take steps to combat fraud head-on.

“This is a 1980s-era regulation being weaponised in 2025. It should be withdrawn immediately,” said TIA president and CEO Chris Burroughs.

“Congress and regulators should focus on real solutions to freight fraud and market abuse, not misguided policies that punish legitimate players and destabilise the supply chain.”

Mr Burroughs argued that, rather than strengthen defence against fraud, the proposals would hurt freight intermediaries, especially the small and mid-sized players that make up 70% of TIA membership. They would increase administrative burdens, narrow margins and heighten the risk of companies having to close down.

“This isn’t about protecting truckers, it’s about handing private business information to competitors under the guise of transparency. We find it an amazing irony that OOIDA erroneously links this issue to fraud when the only theft taking place is the trade secrets they’re trying to extract from brokers and shippers,” he added.

Satish Jindel, president of SJ Consulting, shares the association’s misgivings. He said: “It is competitive information that shouldn’t be disclosed. If you get people to sign non-disclosure agreements that involve 100,000 people, it’s not confidential.”

For its part, the OOIDA has argued that releasing contract information would not undermine business but create a fairer environment.

“We’re not suggesting broker transparency will set rates or guarantee certain rates,” it said. “We support the free market and are trying to even the playing field so that truckers aren’t systematically negotiating with one hand behind their backs.”

In its proposal the FMCSA reasoned that “the brokered freight transportation industry requires a certain degree of trust to operate efficiently”, and that trust is undermined if truckers are “prevented from seeing the charges and payments associated with the service they are providing”.

The Small Business in Transportation Coalition (SBTC) said the proposed rules did not go far enough, and criticised the FMCSA’s decision not to add an explicit ban on brokers inserting provisions in contracts requiring carriers to waive their rights to review transaction records.

“This is too little too late, and is disappointing,” wrote SBTC executive director James Lamb on LinkedIn. “It preserves the status quo, which caters to ‘Big Broker’ and the TIA. There is no question now that the FMCSA has been captured by Big Broker in response to the FMCSA’s announcement of the proposals.

“If enacted, the rule or statutory provision would set a dangerous precedent not just for the logistics industry, but for all sectors of the American economy,” he argued. “If this can happen to freight brokers today, who’s next?”

It remains to be seen how the administration in Washington handles the issue. As Mr Burroughs noted, in 2020 President Trump had sided with owner-operators staging a protest over alleged price-gouging by brokers.