Many trucking companies want to operate as brokers which will allow them to go directly to shippers for loads that they want to broker out to others. This is a smart move.
Some trucking company owners, however, want to put their brokerage inside of their trucking company. While this may not be illegal, it is not a good tactic for a number of reasons. For one thing, many shippers are confused whether they are dealing with a trucking company or a brokerage when they start tendering loads to the trucker (or is it the broker?)
What does the Code of Federal Regulations (CFR) have to say on this - P 371.13? (See http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&SID=389124f4cae20b67271bc73605556337&rgn=div8&view=text&node=49:5.1.1.2.14.1.1.7&idno=49
If two companies are operating as one, there needs to be a segregation of income and expenses and the common expenses would need to be allocated in a manner that is equitable. Plus, a consolidated balance sheet would need to be maintained as well.
It is much easier, in my opinion, to set up a separte company from the trucking company for those desiring to set up a brokerage.
Recent Comments