NPRM,"Brokers of Household Goods Transportation by Motor Vehicle

Federal Register / Vol. 72, No. 26 / Thursday, February 8, 2007 / Proposed Rules
detailed rationale for the approval is set
forth in the direct final rule. If no
adverse comments are received in
response to the direct final rule, no
further activity is contemplated. If EPA
receives adverse comments, the direct
final rule will be withdrawn and all
public comments received will be
addressed in a subsequent final rule
based on this proposed rule. The EPA
will not institute a second comment
period on this rule. Any parties
interested in commenting on this
document should do so at this time.
DATES: Written comments must be
received on or before March 12, 2007.
ADDRESSES: Submit your comments,
identified by Docket ID No. EPA–R04–
OAR–2006–0140, by one of the
following methods:
1. www.regulations.gov: Follow the
on-line instructions for submitting
comments.
2. E-mail: [email protected].
3. Fax: (404) 562–9195.
4. Mail: ‘‘EPA–R04–OAR–2006–
0140,’’ Regulatory Development Section,
Air Planning Branch, Air, Pesticides and
Toxics Management Division, U.S.
Environmental Protection Agency,
Region 4, 61 Forsyth Street, SW.,
Atlanta, Georgia 30303–8960.
5. Hand Delivery or Courier. Deliver
your comments to: Joydeb Majumder,
Air Toxics and Monitoring Branch, U.S.
Environmental Protection Agency,
Region 4, 61 Forsyth Street, SW.,
Atlanta, Georgia 30303–8960. Such
deliveries are only accepted during the
Regional Office’s normal hours of
operation. The Regional Office’s official
hours of business is Monday through
Friday, 8:30 to 4:30, excluding federal
holiday’s comments. Please see the
direct final rule which is located in the
Rules section of this Federal Register
for detailed instructions on how to
submit comments.
FOR FURTHER INFORMATION CONTACT:
Joydeb Majumder, Air Toxics and
Monitoring Branch, U.S. Environmental
Protection Agency, Region 4, 61 Forsyth
Street, SW., Atlanta, Georgia 30303–
8960. The telephone number is (404)
562–9121. Mr. Majumder can also be
reached via electronic mail at
[email protected].
For
additional information see the direct
final rule which is published in the
Rules Section of this Federal Register.

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SUPPLEMENTARY INFORMATION:

Dated: January 19, 2007.
J.I. Palmer, Jr.,
Regional Administrator, Region 4.
[FR Doc. E7–2118 Filed 2–7–07; 8:45 am]
BILLING CODE 6560–50–P

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DEPARTMENT OF TRANSPORTATION
Federal Motor Carrier Safety
Administration
49 CFR Parts 371, 375, 386, and 387
[Docket No. FMCSA–2004–17008]
RIN 2126–AA84

Brokers of Household Goods
Transportation by Motor Vehicle
Federal Motor Carrier Safety
Administration (FMCSA), DOT.
ACTION: Notice of proposed rulemaking
(NPRM); request for comments.
AGENCY:

SUMMARY: FMCSA proposes to amend its
regulations to require brokers who
arrange the transportation of household
goods in interstate or foreign commerce
for consumers to comply with
additional consumer protection
requirements. This rulemaking is in
response to the Safe, Accountable,
Flexible, Efficient Transportation Equity
Act: A Legacy for Users (SAFETEA–LU)
and a petition for rulemaking from the
American Moving and Storage
Association. This rulemaking is
intended to educate and inform
consumers and brokers about fair and
competitive business practices proposed
by the FMCSA.
DATES: FMCSA must receive your
comments by May 9, 2007.
ADDRESSES: You may submit comments,
identified by DOT DMS Docket Number
FMCSA–2004–17008, by any of the
following methods:
• Federal eRulemaking Portal: http://
www.regulations.gov. Follow the
instructions for submitting comments.
• Agency Web Site: http://
dms.dot.gov. Follow the instructions for
submitting comments on the DOT
electronic docket site.
• Fax: 1–202–493–2251.
• Mail: Docket Management Facility;
U.S. Department of Transportation, 400
Seventh Street, SW., Nassif Building,
Room PL–401, Washington, DC 20590–
0001.
• Hand Delivery: Room PL–401 on
the plaza level of the Nassif Building,
400 Seventh Street, SW., Washington,
DC, between 9 a.m. and 5 p.m., Monday
through Friday, except Federal
Holidays.
Instructions: All submissions must
include the agency name and docket
number (FMCSA–2004–17008) or
Regulatory Identification Number (RIN)
for this rulemaking (RIN 2126–AA84).
Note that all comments received will be
posted without change to http://
dms.dot.gov, including any personal
information provided. Please see the

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Privacy Act heading for further
information.
Docket: For access to the docket to
read background documents or
comments received, go to http://
dms.dot.gov at any time or to Room PL–
401 on the plaza level of the Nassif
Building, 400 Seventh Street, SW.,
Washington, DC, between 9 a.m. and 5
p.m., Monday through Friday, except
Federal Holidays.
Privacy Act: Anyone is able to search
the electronic form for all comments
received into any of our 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) or you may visit http://
dms.dot.gov.
Comments received after the comment
closing date will be included in the
docket and we will consider late
comments to the extent practicable.
FMCSA may, however, issue a final rule
at any time after the close of the
comment period.
FOR FURTHER INFORMATION CONTACT: Ms.
Dorothea Grymes, Household Goods
Team, Commercial Enforcement
Division, (202) 385–2400, FMCSA,
Department of Transportation, 400
Seventh Street, SW., Washington, DC
20590.
SUPPLEMENTARY INFORMATION:

Legal Basis for the Rulemaking
The Secretary of Transportation’s
(Secretary) general jurisdiction to
establish regulations concerning the
procurement by property brokers of forhire transportation in interstate or
foreign commerce is found at 49 U.S.C.
13501. Brokers of household goods are
a subset of all property brokers but
specifically register with FMCSA as
household goods brokers. This
rulemaking applies only to household
goods brokers procuring for-hire
transportation in interstate or foreign
commerce. The Secretary is authorized
to collect from household goods brokers
‘‘information the Secretary decides is
necessary’’ to ensure a transportation
system that meets the needs of the
United States. (49 U.S.C. 13101 and
13301). Brokers of household goods are
required to register with the Secretary
by 49 U.S.C. 13904(a)(1). Section 4142
of the Safe, Accountable, Flexible,
Efficient Transportation Equity Act: A
Legacy for Users (SAFETEA–LU) (Pub.
L. 109–59), which made changes to
certain other registration requirements,
did not change registration requirements

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for household goods brokers. The
Secretary also has authority to adopt
regulations applicable to registered
household goods brokers which ‘‘shall
provide for the protection of shippers by
motor vehicle.’’ (49 U.S.C. 13904(c)) The
Secretary’s authority to inspect and
copy household goods broker records is
found at 49 U.S.C. 14122. The Secretary
has delegated these various authorities
to the FMCSA Administrator. (49 CFR
1.73(a)).
This rulemaking is based on the
statutory provisions cited above and on
the Household Goods Mover Oversight
Enforcement and Reform Act of 2005,
otherwise known as Title IV, Subtitle B
of SAFETEA–LU. This rulemaking
focuses on the business practices of
household goods brokers engaged in
interstate or foreign commerce.
Household goods brokers arrange, but
do not perform, the transportation of
household goods shipments. FMCSA
will address the SAFETEA–LU
provisions specifically directed to
household goods motor carriers in
separate rulemakings, as appropriate.
While section 4205 of SAFETEA–LU
contains estimating requirements for
household goods motor carriers, the
general authority cited above allows
FMCSA to establish such requirements
for household goods brokers.
Section 4212 of SAFETEA–LU directs
the Secretary to require a household
goods broker to provide shippers with
the following information whenever the
broker has contact with a shipper or a
potential shipper:
1. The broker’s U.S. DOT number.
2. The FMCSA pamphlet titled, ‘‘Your
Rights and Responsibilities When You
Move.’’
3. A list of all motor carriers
providing transportation of household
goods used by the broker and a
statement that the broker is not a motor
carrier providing transportation of
household goods.
Section 4209 adds new civil penalties
for unlawful broker estimating practices
and increases existing civil penalties for
providing motor carrier or broker
services subject to FMCSA jurisdiction
without being registered with FMCSA.
Existing FMCSA Regulations
Applicable to Household Goods
Brokers
Household goods brokers have been
regulated by FMCSA and its predecessor
agencies for many years and a number
of regulations apply to them, including
registration requirements (49 CFR part
365), process agent requirements (49
CFR part 366) and financial
responsibility requirements (49 CFR
part 387). Section 387.307 requires

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property brokers, including household
goods brokers, to maintain a surety bond
or trust fund agreement in the amount
of at least $10,000 to provide for
payments to motor carriers or shippers
if the broker fails to carry out its
agreement to supply transportation by
authorized motor carriers.
Part 371 specifies general property
broker transaction record requirements,
prohibits misrepresentation of the
broker’s name or non-carrier status, and
prohibits certain rebating and
compensation practices. Part 379
specifies general recordkeeping time
periods.
FMCSA can also issue orders to
compel compliance, impose civil
monetary penalties, revoke the broker’s
license, or seek federal court orders to
stop statutory and/or regulatory
violations. Because household goods
brokers do not provide the actual
transportation, they are not subject to
FMCSA’s safety jurisdiction.
Previous Household Goods Rulemaking
FMCSA regulations on household
goods motor carriers and the proposed
regulations for household goods brokers
are intended for the protection of
individual shippers (as defined in 49
U.S.C. 13102(13) added by section 4202
of SAFETEA–LU). FMCSA regulations
on household goods motor carriers and
the proposed regulations for household
goods brokers do not apply to corporate,
government, or military-arranged and
paid moves.
The Interstate Commerce Commission
(ICC), one of FMCSA’s predecessor
agencies, concluded that household
goods brokers may not provide
estimates directly to shippers.1 The ICC
reasoned that shippers aggrieved by an
act or omission of a broker would be
unprotected by the household goods
consumer protection regulations
(currently codified at 49 CFR part 375)
because only motor carriers were
required to comply with these
regulations. This problem was
addressed in the Household Goods;
Consumer Protection Regulations issued
by FMCSA in 2003 (68 FR 35064; June
11, 2003), which substantially revised
part 375.2
In its 2003 rulemaking, FMCSA added
a new § 375.409 that allowed a
household goods broker to provide an
1 See Entry Control of Brokers, 126 M.C.C. 476
(1977); Exec-Van Systems, Inc., Broker Application,
128 M.C.C. 669 (1978); and Ward Moving & Storage
Co., Inc., Household Goods Broker Application,
132, M.C.C. 589 (1981).
2 These regulations were interim final rules.
Following several technical amendments, the
regulations became final rules in July 2005 (70 FR
39949, July 12, 2005).

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estimate to a shipper if the following
requirements are met:
1. There must be a written agreement
between the broker and the motor
carrier.
2. The written agreement must
provide that the motor carrier adopts the
broker’s estimate as its own.
3. The motor carrier must ensure
compliance with all the requirements of
part 375 pertaining to estimates,
including the requirement that the
motor carrier must relinquish
possession of the shipment if the
shipper pays the motor carrier 110
percent of a non-binding estimate at the
time of delivery.
In the preamble to the 2003
rulemaking FMCSA explained that the
individual shipper would not be
deprived of the protections provided in
part 375, even if the broker could not be
held directly responsible for
compliance, because the motor carrier
would still be held accountable for
complying with part 375.
Petition for Rulemaking
On March 6, 2003, the American
Moving and Storage Association
(AMSA) petitioned FMCSA to initiate a
rulemaking to amend 49 CFR part 371,
‘‘Brokers of Property,’’ to impose
specific additional requirements on
household goods brokers. AMSA’s main
argument for additional rulemaking was
its assertion that there were an
increasing number of ‘‘moving-related’’
Web sites hosted by household goods
brokers engaging in unfair business
practices.
AMSA’s petition states a significant
number of the complaints it receives
involve the same Internet companies,
many of which are based in Florida.
AMSA argues the fact these companies
are involved in moves having no
connection to Florida as an origin or
destination demonstrates the impact of
the Internet on these household goods
broker arrangements and how the
Internet is being used to entrap
unsuspecting consumers. AMSA states
it often receives complaints from
consumers who have dealt with a
Florida-based Internet broker, who in
turn arranged a move from a nonFlorida origin to another non-Florida
destination. AMSA states once these
brokers establish a business relationship
with the consumer, they require
payment of a deposit of several hundred
dollars or more, fade from the picture,
and leave the consumer to deal with, in
most cases, a motor carrier who has
failed to register with FMCSA. AMSA
believes that a significant network of
unscrupulous household goods brokers
and household goods motor carriers is

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Federal Register / Vol. 72, No. 26 / Thursday, February 8, 2007 / Proposed Rules
functioning with the sole purpose of
bilking the moving public by
demanding charges that bear no relation
to the legitimate costs of moving, or by
collecting charges for services that are
not performed.
AMSA provided ten additional
examples of complaints it has received
to illustrate the nature of the problems
being experienced by the moving
public. The examples generally involve
circumstances similar to the Florida
example discussed in the previous
paragraph.
AMSA wants FMCSA to amend our
regulations to:
• Specifically name and include
household goods brokers in 49 CFR part
371, Brokers of Property;
• Require a household goods broker
to identify itself as a broker and provide
its location and telephone number;
• Add a requirement for household
goods brokers to provide consumers
with 49 CFR part 375, Appendix A, the
pamphlet ‘‘Your Rights and
Responsibilities When You Move;’’
• Add a requirement that a household
goods broker must only use FMCSAregistered household goods motor
carriers (those with a U.S. DOT
identification number, insurance on file
with us, and registered to transport
household goods in interstate or foreign
commerce);
• Add a requirement for full written
disclosure concerning estimates in
advance of the move;
• Add a requirement that the broker
will refund consumer deposits if the
consumer cancels the shipment;
• Add a requirement to advise the
consumer about the existence of the
household goods broker’s surety bond/
trust fund; and
• Add a requirement to report illegal
operations of household goods carriers
to us.
FMCSA granted AMSA’s petition and
issued an Advance Notice of Proposed
Rulemaking (ANPRM) in 2004 (69 FR
76664; December 22, 2004), which is
also available in docket FMCSA–2004–
17008. In the ANPRM, FMCSA sought
answers to 36 questions related to
household goods broker issues. The
questions sought to determine the extent
to which the public believes a problem
exists and, if so, whether regulatory or
non-regulatory solutions would best
solve the problem. The ANPRM also
addressed potential cost-benefit
estimates, potential information
collection burdens, and other potential
impacts. The agency also requested
comments on an array of specific
regulatory requirements that should be
considered.

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Summary of Responses to ANPRM
FMCSA received comments from the
following nine entities: AMSA; the
Owner-Operator Independent Drivers
Association, Inc. (OOIDA), an
international trade association
representing independent owneroperators and professional drivers; the
Public Utilities Commission of Ohio
(PUCO), the regulator of intrastate
household goods brokers in the State of
Ohio; James Lamb, a household goods
broker registered with FMCSA under
the name Carrier Authority.com, Inc.;
Tom Kizer, an FMCSA-registered broker
doing business as Absolute
Transportation Logistics; Timothy
Walker, owner of the Web site
MovingScam.com; Norman S. Marshall,
an attorney; Noble Mountain Tree Farm,
a shipper of Christmas trees; and Roger
A. Bauer of Western Wholesale
Distributing.
Generally, the commenters did not
express support for rulemaking action
and they did not address many of the
specific questions raised in the ANPRM.
For example, none of the commenters
submitted specific information relating
to the questions about the estimated
number of household goods brokers, or
questions about details of the household
goods broker business. Commenters did,
however, offer useful information and
suggestions in other areas to assist
FMCSA to develop this proposal.
Commenters expressed concern that
household goods shippers may not be
aware they are dealing with a household
goods broker rather than a household
goods carrier and that FMCSA should
require household goods brokers to
disclose their status and provide
information to facilitate contacting
household goods brokers in the event of
problems with a shipment. Certain
commenters also urged FMCSA to
require household goods brokers to deal
solely with FMCSA-registered
household goods motor carriers to
minimize potential problems with a
move.
Timothy Walker recommends FMCSA
require household goods brokers to
disclose which household goods carriers
they have agreements with or, at a
minimum, which household goods
carrier the household goods broker
intends to tender the customer’s
shipment to before the move so
customers have adequate time to
research the carrier’s license status and
business history.
James Lamb and PUCO believe that
although household goods brokers could
play some role in providing written
estimates, the primary responsibility for
issuing and honoring estimates should

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5949

continue to remain with the household
goods carrier and the household goods
broker should be required to advise the
customer of this fact.
PUCO and AMSA believe household
goods brokers should be required to
refund a deposit required by a
household goods broker, minus the
reasonable cost of any services
provided, if the shipper cancels the
shipment. James Lamb believes that if a
household goods broker requests
deposits for a planned shipment, the
household goods broker should disclose
the deposit’s terms to the shipper.
FMCSA has adopted some of the
commenters’ suggestions in the
proposed rule, as discussed in more
detail in the section headed ‘‘Proposed
Rule’’.
Continuing Problems With Household
Goods Brokers
While FMCSA has addressed certain
household goods broker issues in recent
years, a number of problems remain.
Based on FMCSA’s review of the
responses to the ANPRM and
complaints about household goods
brokers, the agency believes some
household goods brokers are acting
deceptively, particularly on the Internet.
These broker operations use various
disguises and facades to mislead
vulnerable consumers into believing
that they are complying with FMCSA
regulations. For example, a consumer
may visit a Web site and be presented
with misleading information for moving
services. The Web sites may list a
number of motor carriers that are
performing transportation services,
however, the list on the Web site may
include some motor carriers that do not
have operating authority from FMCSA
to engage in the interstate transportation
of household goods.
There are several factors contributing
to the problems experienced by shippers
in using household goods brokers:
1. Minimal or no requirement to
disclose contact and nature of
operations information. The Internet has
provided an easy way for companies to
advertise; however, it also makes it
possible for unscrupulous companies to
effectively conceal their identities,
avoid disclosing the true nature of their
operations, make misrepresentations to
consumers, and defraud the moving
public.
2. No protection of consumers from
unlicensed, illegal motor carriers.
Evidence from complaints filed with
FMCSA by some consumers show
household goods brokers have arranged
for transportation by unregistered motor
carriers. Such carriers are frequently not
accountable to customers, whose

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attempts to obtain redress for problems
associated with the move may be
ignored or otherwise undermined.
3. The practice of quoting estimates of
charges without providing written
documents. Unscrupulous brokers often
fail to give consumers written estimates
of charges, which permit them to avoid
accountability when conflicts later arise.
This is compounded by the fact that
consumers are often persuaded to do
business with the broker on the basis of
an unrealistically low estimate, but may
be required to pay substantially higher
transportation charges under the tariff of
the motor carrier transporting the
shipment.
4. No requirement for brokers to
disclose refund policy for customers’
deposits when shipments are cancelled.
Shippers have alleged household goods
brokers have consistently not made
clear their customer deposit refund
policies.
5. No significant identifiable capital
investment, reputation and standing in
the community, or insurance concerns.
Because many household goods brokers
make such small investments in their
business, there is a lack of incentive to
protect this investment by following
generally accepted business practices of
fair and honest dealings with their
customers.
6. Consumer lack of knowledge and
experience with moving transactions.
Household goods brokers are dealing
with a relatively unsophisticated group
of shippers who may not be familiar
with the applicable regulatory
requirements, thus highlighting the
need for specific corrective actions to
better educate consumers so they can
better protect themselves against
substantial financial and property
losses.
7. Internet brokers providing false or
inaccurate information on their Web
sites. A number of Internet brokers are
providing false or misleading
information on their Web sites, contrary
to current ‘‘advertising’’ requirements in
part 371.
The Proposed Rule
This proposal addresses the problems
identified above and incorporates
requirements mandated by SAFETEA–
LU, recommended by AMSA in its
petition, and some of the
recommendations made by commenters
to the ANPRM. FMCSA proposes to
amend the current broker regulations in
part 371 by adding a new subpart B
specifically for household goods
brokers; amending appendix B of part
386 to incorporate the civil penalties
applicable to household goods brokers
added by SAFETEA–LU; and amending

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part 387 to increase the amount of
surety bond or trust fund currently
required for household goods brokers.
This proposed rule is intended to
educate and inform consumers and
household goods brokers about fair and
competitive business practices the
FMCSA believes should be a part of
every transaction between individual
shippers and household goods brokers.
Impact on Competition
The proposed rule consists of five
basic elements:
• It would require household goods
brokers to disclose to individual
shippers critical information designed
to educate the shipper and facilitate a
satisfactory moving experience.
• It would require household goods
brokers to use only household goods
motor carriers that are properly licensed
and insured.
• It would impose additional
requirements governing estimates,
consistent with those statutorily
imposed on household goods motor
carriers.
• It would incorporate new statutory
penalties for providing estimates
without a contract with a household
goods motor carrier and for operating
without being registered with FMCSA.
• It would adjust for inflation the
current minimum level of financial
responsibility required of household
goods brokers.
The proposed disclosure requirements
are intended to result in better-educated
individual shippers who, armed with
information about the household goods
moving process, the regulations
governing that process, and household
goods broker cancellation, deposit and
refund policies, will be in a better
position to evaluate whether a particular
household goods broker or household
goods motor carrier best serves their
moving needs. A more sophisticated
population of customers encourages
service providers to compete for their
business by offering better quality
service, adopting more customerfriendly policies or offering lower
prices. The proposed disclosure
requirements, therefore, would tend to
be pro-competitive.
The proposal to require household
goods brokers to verify that the motor
carriers they use are properly licensed
and registered to transport household
goods is intended to ensure that motor
carriers compete on a level playing field
and customers receive better service.
Interstate household goods carriers are
required by law to register with FMCSA,
maintain minimum levels of public
liability and cargo insurance and charge
only published tariff rates. Unregistered

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carriers are more likely to lack the
necessary insurance and tariff and to
ignore the consumer protection
regulations in 49 CFR part 375. It is
generally cheaper to operate if a carrier
does not comply with the regulatory
requirements applicable to its industry.
Permitting, or failing to discourage, use
of illegal motor carriers penalizes
competitors who comply with the
regulations and incur the additional
costs associated with compliance. By
requiring household goods brokers to
use registered, compliant carriers, the
proposed rule will encourage noncompliant motor carriers to register with
FMCSA, thus creating a level playing
field that should result in better
customer service through the promotion
of fair competition and the elimination
of unlawful activity.
By requiring household goods brokers
to put all estimates in writing based on
a physical survey of the household
goods (unless the household goods
broker or its agent is located more than
50 air-miles from the shipper’s location
or the shipper waives a physical
survey), the proposed rule intends to
subject household goods brokers to the
same estimating requirements imposed
by statute on household goods motor
carriers by section 4205 of SAFETEA–
LU. Having several written estimates
will allow consumers to make more
informed choices and level the playing
field. Household goods brokers
commonly provide telephone estimates
without ever viewing the household
goods. Experience has shown that such
estimates are less reliable than estimates
based on a physical survey. Many
consumers may not realize this and
choose a household goods broker based
on a low-ball telephone estimate.
However, the ultimate price, based on
the shipment’s weight, may be
considerably higher. By promoting more
reliable estimates, the proposal will
encourage competition by standardizing
the estimating rules and reducing the
‘‘sticker shock’’ experienced by
consumers at their new residence after
receiving and ordering moving services
based on unreasonably low estimates.
FMCSA recognizes that SAFETEA–LU
did not prescribe estimating
requirements for household goods
brokers as it did for household goods
motor carriers. Nevertheless, we believe
that we have existing statutory authority
in 49 U.S.C. 13904(c) to do this and that
an individual shipper’s protection
against unreliable estimates should not
depend upon whether the shipper uses
a broker or carrier to provide the
estimate. We also recognize that unlike
household goods motor carriers, who
maintain office and/or agency locations

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in reasonable proximity to most
shippers, household good brokers
commonly transact business over the
Internet, commonly do not have agents,
and, in most cases, are located more
than 50 miles from the shipping site.
Although household goods broker James
Lamb commented his company arranges
for on-site inspections as a part of its
business practices, FMCSA believes
most household goods brokers do not
arrange for such on-site inspections. The
Agency invites public comment on the
impact to shippers, brokers and motor
carriers of applying or removing the 50
air-mile provision for household goods
broker estimates. FMCSA would also
like comments on alternatives to the 50mile requirement. One such alternative
might be to require that all estimates
provided by household goods brokers
and motor carriers be based on a
physical survey, regardless of shipper
location, unless the individual shipper
specifically waives the physical survey
requirement.
FMCSA also invites comment on
whether permitting individual shippers
to waive a physical survey by checking
an ‘‘opt-out’’ box on-line would satisfy
the SAFETEA–LU requirement that
physical survey waivers be in the form
of a signed, written agreement. The
Agency is not specifically proposing an
opt-out waiver procedure at this time,
but will consider an opt-out waiver or
other waiver suggestions aimed at
making the waiver process more flexible
and convenient, consistent with
statutory requirements.
Comments should also address
whether electronic waivers can be
provided consistent with the provisions
of 15 U.S.C. 7001 et seq., the Electronic
Signatures in Global and National
Commerce Act, Pub. L. 106–229, 114
Stat. 464 (June 30, 2000).
The penalties incorporated by the
proposed rule are mandated by statute
and are effective even without
rulemaking. They are intended to make
the cost of noncompliance with the
statute significantly higher than the cost
of compliance. By encouraging
compliance by illegal operators, they are
designed to eliminate unfair competitive
disadvantages to legitimate operators
who must bear the cost of compliance.
The inflation adjustment to the
household goods broker minimum
financial responsibility requirement
applies to all household goods brokers
and is based on the fact that the
protection provided by the current
required surety bond or trust agreement
has significantly diminished because
the minimum amount has not changed
in over 25 years. The proposed change
in the requirement should not have an

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anti-competitive impact. Legitimate
household goods brokers who honor
their legal obligations will continue to
remain in business.
FMCSA invites comments regarding
the potential impact of the proposed
rule on competition within the
household goods moving industry.
Subpart B—Special Rules for
Household Goods Brokers
Proposed new subpart B of part 371
for the most part contains new
requirements mandated by SAFETEA–
LU or suggested by the AMSA Petition
for Rulemaking. A few of the proposed
requirements in part 371 would echo
certain provisions of part 375 applicable
to motor carriers of household goods.
Section 371.101 If I operate as a
household goods broker in interstate or
foreign commerce, must I comply with
subpart B of this part?
This proposed section requires
household goods brokers that operate in
interstate or foreign commerce to
comply with all of the provisions of
subpart B.
Section 371.103 What are the
definitions of terms used in this
subpart?
This section contains a definition of
‘‘household goods broker’’ and cross
references the definitions of ‘‘household
goods’’ and ‘‘individual shipper’’ in
§ 375.103.
Section 371.105 Must I use a motor
carrier that has a valid U.S. DOT
number and valid operating authority
issued by FMCSA to transport
household goods in interstate or foreign
commerce?
This proposed section makes it clear
that a household goods broker may only
act as a household goods broker for a
household goods motor carrier that has
a valid U.S.DOT number and valid
operating authority issued by FMCSA.
This proposed requirement was
requested by AMSA in its Petition for
Rulemaking and was suggested by some
of the commenters to the ANPRM. The
use of FMCSA-registered household
goods motor carriers to provide the
transportation will provide a greater
degree of assurance that the household
goods motor carrier will comply with
applicable FMCSA regulations. FMCSA
will provide household goods brokers
with instructions on the use of the
agency’s Internet Web site (http://
www.protectyourmove.gov) to help them
quickly locate the registration,
insurance, and safety records of
household goods motor carriers before
tendering a shipment to a household

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5951

goods carrier. These instructions will be
provided in compliance guides to
implement this provision, if the agency
publishes a final rule. These
instructions may also be provided in
small entity compliance guides,3 if the
agency must publish such guides in
accordance with the Regulatory
Flexibility Act.
Section 371.107 What information
must I display in my advertisements and
Internet web homepage?
Proposed § 371.107 implements the
section 4212 of SAFETEA–LU
requirements that household goods
brokers disclose to potential shippers
their Department of Transportation
number and that they are not motor
carriers providing transportation of
household goods. FMCSA is also
proposing that household goods brokers
disclose additional information not
required by SAFETEA–LU, but which
FMCSA believes is necessary to
properly educate and assist individual
shippers. This section would require a
household goods broker to prominently
display in its advertisements and on its
Web site the following:
1. The physical location of the
business.
2. Its ‘‘MC’’ operating authority
number and U.S.DOT registration
number.4
3. Its status as a household goods
broker.
4. A statement that the broker does
not transport household goods but that
it can arrange for such transportation.
Section 371.109 Must I inform
individual shippers which motor
carriers I use?
Proposed § 371.109 requires a
household goods broker to provide each
3 For each final rule requiring a final regulatory
flexibility analysis, section 212 of the Small
Business Regulatory Enforcement Fairness Act of
1996, Pub. L. No. 104–121, 110 Stat. 857 (codified
at 5 U.S.C. 601 et seq.) requires Federal agencies to
publish one or more small entity compliance
guides. FMCSA has determined preliminarily in its
analysis under the Regulatory Flexibility Act (5
U.S.C. 601–612), discussed later in this NPRM, that
this proposed rule will most likely not have a
significant economic impact on all 690 small entity
household goods brokers (and any future small
entity household goods brokers), but there remains
some uncertainty as to the impacts to individual
brokers. The agency has prepared an initial
regulatory flexibility analysis. FMCSA invites
comments on its initial regulatory flexibility
analysis.
4 FMCSA has proposed eliminating the ‘‘MC’’
operating authority number in its NPRM of May 19,
2005 (70 FR 28990) regarding the Unified
Registration System mandated by the ICC
Termination Act of 1995. Until FMCSA publishes
a final rule in that proceeding, we propose to
include a requirement for the household goods
broker to display the ‘‘MC’’ number in its
advertisements.

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Federal Register / Vol. 72, No. 26 / Thursday, February 8, 2007 / Proposed Rules

shipper or potential shipper who has
contact with the household goods
broker with a list of all household goods
motor carriers used by the broker
(including their U.S.DOT and MC
numbers) and a statement that the
household goods broker is not a motor
carrier providing transportation of
household goods. This requirement is
specifically mandated by section
4212(3) of SAFETEA–LU.

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Section 371.111 Must I provide
individual shippers with Federal
consumer protection information?
Proposed § 371.111 would require a
household goods broker to provide
potential shippers with one copy of
each of the two FMCSA consumer
pamphlets: ‘‘Your Rights and
Responsibilities When You Move,’’ and
‘‘Ready to Move?—Tips for a Successful
Interstate Move.’’ Section 4212 of
SAFETEA–LU requires household goods
brokers to distribute publication ESA
03005, entitled ‘‘Your Rights and
Responsibilities When You Move’’.
However, the publication number used
in the statute actually refers to ‘‘Ready
to Move?—Tips for a Successful
Interstate Move’’. ‘‘Your Rights and
Responsibilities When You Move’’ is
publication OCE 100. Section 4205 of
SAFETEA–LU requires household goods
motor carriers to distribute both
pamphlets and we propose to impose
the same requirement on household
goods brokers. Although section 4212
requires household goods brokers to
provide consumer protection
information ‘‘whenever they have
contact with a shipper or potential
shipper’’, we do not interpret this
language to mean that the information
must be provided every time there is
contact. We believe that Congress
intended that this information be
furnished to individual shippers at the
time an estimate is given and the
shipper may not have come into contact
with a carrier at that stage of the move.
This section permits the household
goods broker to make the information
available through an Internet home page
hyperlink as suggested by PUCO in its
comments or by physical distribution to
each potential shipper. Providing an
Internet home page hyperlink as an
option to physical distribution will
reduce regulatory burdens on the small
entities subject to this proposal. The
household goods broker may distribute
each of the two publications in the form
published by FMCSA or in a modified
format published by the household
goods motor carrier the household
goods broker intends to use to provide
the transportation, provided the

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modifications comply with 49 CFR
375.213.
This section would also require a
household goods broker to obtain and
retain for three years an electronic or
paper receipt showing that the shipper
received copies of both documents. This
will enable household goods brokers to
demonstrate compliance with the
distribution requirement.
Section 371.113 May I provide
individual shippers with a written
estimate?
This proposed section requires that, if
the household goods broker provides an
estimate, it must be in writing and must
be based on a physical survey of the
shipper’s household goods if the
household goods are located within a 50
air-mile radius of the broker or its
estimating agent. This proposed section
is consistent with 49 U.S.C. 14104(b), as
amended by section 4205 of SAFETEA–
LU. In accordance with section 4209 of
SAFETEA–LU, proposed § 371.113(a)
also requires the household goods
broker to prepare the estimate in
accordance with a signed written
agreement with the motor carrier who
will actually transport the shipper’s
household goods.
Proposed § 371.113(b) requires
household goods brokers to base their
estimates upon the published tariffs of
the authorized household goods motor
carriers they use.
Proposed § 371.113(c) permits
shippers to waive the physical survey
requirement.
Proposed § 371.113(d) requires that
the records of transactions conducted
under this section be retained for as
long as a household goods broker
provides estimates on behalf of an
authorized household goods motor
carrier and for three years thereafter for
shipments actually arranged for the
individual shipper.
Section 371.115 Must I maintain
agreements with motor carriers before
providing written estimates on behalf of
these carriers?
Proposed § 371.115(a) requires
household goods brokers to maintain
written agreements with authorized
household goods motor carriers before
providing estimates and lists the items
that must be included in these
agreements.
Proposed § 371.115(b) states that the
signed written agreement required
under the section is considered to be
public information to be produced on
reasonable request of the public.
Proposed § 371.115(c) requires that
the agreements required by this section
be retained for as long as a household

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goods broker provides estimates on
behalf of the authorized household
goods motor carrier and for three years
thereafter.
Section 371.117 Must I provide
individual shippers with my policies for
canceling a shipment?
This proposed section requires a
household goods broker to disclose its
cancellation policy, deposit policy, and
refund policy on its Web site and in its
customer agreements. The proposed
section also requires the household
goods broker to maintain records that
document requests for cancellation and
the disposition of cancellations, i.e.,
proof of refunds when made.
FMCSA has found that household
goods brokers have consistently retained
customer deposits even when the
customer cancels the shipment well in
advance of the planned moving date. In
its Petition for Rulemaking and
comments to the ANPRM, AMSA
proposed that, before a deposit can be
demanded by the household goods
broker, the broker must make full
disclosure of the terms governing
deposits and forfeitures in the event of
cancellations. This would add an
additional layer of protection for the
consumer.
FMCSA does not believe it should
mandate the specifics of a household
goods broker’s refund policies nor
require household goods brokers to
refund deposits, as the household goods
broker may have incurred legitimate
costs on behalf of shippers who
subsequently decide to not use the
household goods broker’s services.
Section 371.119 What must I do before
I arrange with a motor carrier to
transport household goods in interstate
or foreign commerce?
This proposed section requires that
each household goods broker must
‘‘inspect, verify, and document’’ the
household goods motor carrier’s
U.S.DOT registration and MC operating
authority validity each month. The
household goods broker would comply
with this requirement by using
FMCSA’s Internet Web site (http://
www.protectyourmove.gov) to check
whether the motor carrier has active forhire authority to transport household
goods and evidence of the necessary
financial responsibility on file with
FMCSA. The household goods broker
must print or electronically save a copy
of the on-line report(s) showing the
information it has verified and must
maintain the information for at least
three years. FMCSA will provide
detailed instructions on how to navigate
FMCSA’s Internet Web site (http://

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Federal Register / Vol. 72, No. 26 / Thursday, February 8, 2007 / Proposed Rules
www.protectyourmove.gov) in its
compliance guides to implement this
provision, if the agency publishes a final
rule. These instructions may also be
provided in small entity compliance
guides.5
In developing this proposal, FMCSA
considered requiring household goods
brokers to inspect, verify, and document
each household goods motor carrier’s
U.S.DOT registration and MC operating
authority numbers before giving a
shipper every estimate and before
arranging any shipment with a
household goods motor carrier. The
agency decided not to propose this
option because the costs to the 690
registered household goods brokers
would increase from approximately
$42,400 to about $220,000 per year. The
agency is proposing to minimize costs
imposed on responsible small
household goods brokers to the extent
practicable by proposing the checks be
made on a monthly basis. See the
agency’s draft Regulatory Evaluation in
docket FMCSA–2004–17008 for more
information. FMCSA encourages
comments and data, including cost data,
on whether any potential final rule on
checking carriers’ registrations should
be more or less frequent than this
proposal.
Section 371.121 What penalties may
FMCSA impose for violations of this
part?
This proposed section states that
household goods brokers who violate
the provisions of subpart B would be
subject to the penalty provisions of 49
U.S.C. chapter 149. It also confirms that
these penalty provisions would not
deprive a shipper of any other remedies
provided by law. Section 4209 of
SAFETEA–LU amended 49 U.S.C.
14901(d) by adding new penalties and
increasing existing penalties applicable
to household goods brokers. See the
discussion below under part 386,
appendix B. Proposed § 371.121 would
parallel current § 375.901.
Part 375—transportation of Household
Goods in Interstate Commerce;
Consumer Protection Regulations

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Section 375.409 May household goods
brokers provide estimates?
We propose changing § 375.409 to
state that the written agreement between
the household goods broker and the
household goods motor carrier must
contain all of the items required in
proposed § 371.115.
5 See footnote 3 above for a discussion of the
small entity compliance guide.

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Part 386—Rules of Practice for Motor
Carrier, Broker, Freight Forwarder, and
Hazardous Materials Proceedings
Appendix B to Part 386—Penalty
Schedule; Violations and Maximum
Monetary Penalties
FMCSA proposes to amend paragraph
(g) of appendix B by adding two new
provisions to specify the minimum civil
penalties for: (1) household goods
brokers who make estimates without the
necessary contracts with household
goods motor carriers in effect; and (2)
household goods brokers and household
goods motor carriers who operate in
interstate commerce without the
necessary FMCSA registration. These
proposed new paragraphs incorporate
into our rules the penalties established
in section 4209 of SAFETEA–LU.
Part 387—Minimum Levels of Financial
Responsibility for Motor Carriers
Section 387.307 Property broker surety
bond or trust fund
FMCSA proposes to add specific
language to § 387.307(a) to require
household goods brokers to have a
surety bond or trust fund in effect for
$25,000. The ICC created the financial
responsibility requirements for
household goods brokers in 1980. The
requirement was set at $10,000 to
ensure shippers or motor carriers would
be paid if the household goods broker
failed to carry out its contracts,
agreements, or arrangements for the
supplying of transportation by
authorized household goods motor
carriers. Although commenters to the
ANPRM stated that the $10,000
requirement for the surety bond/trust
fund should be raised, FMCSA does not
have adequate data to determine the
appropriate amount of increase
necessary for the protection of carriers
or shippers. Accordingly, FMCSA is
proposing to raise the surety bond/trust
fund requirement for household goods
brokers from $10,000 to $25,000, based
on adjustments for inflation. Adjusting
the $10,000 minimum figure for
inflation as measured by the Consumer
Price Index, results in purchasing power
of $24,490.29 in 2006. Because a final
rule based on this NPRM may not be in
effect until 2008, it is reasonable to
round up to $25,000. When FMCSA
obtains adequate data to propose raising
the limit higher than $25,000, FMCSA
will consider proposing that higher
limit in a future rulemaking or
supplemental proposal. We invite
public comment on the appropriate
level of the surety bond or trust fund.

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5953

Regulatory Analyses
Executive Order 12866 (Regulatory
Planning and Review); DOT Regulatory
Policies and Procedures
FMCSA has determined that this
action is a significant regulatory action
within the meaning of Executive Order
12866 and the U.S. Department of
Transportation regulatory policies and
procedures (44 FR 11034, February 26,
1979) because there is substantial public
interest in the interstate transportation
of household goods and related
consumer protection regulations.
FMCSA estimates that the maximum
first-year discounted costs to the
industry of the proposed rule would be
about $1.691 million, while maximum
first-year discounted costs to society of
the proposed rule would be about
$1.841 million. Costs in additional years
would be dependent on new household
goods brokers entering the marketplace,
but would be less than incurred during
the first year. As such, the costs of this
proposal do not exceed the $100 million
annual threshold as defined in
Executive Order 12866.
FMCSA’s full draft Regulatory
Evaluation is in the docket for this
NPRM. It explains in detail how we
estimated cost impacts of the proposal.
This proposal would establish
additional consumer protection
regulations specifically for household
goods brokers to supplement the
regulations at 49 CFR part 375, which
apply to motor carriers transporting
household goods by commercial motor
vehicle in interstate commerce.
FMCSA estimates these regulatory
changes will produce three primary cost
impacts on household goods brokers: (1)
Costs of training certain employees on
the proper application of the regulatory
changes; (2) costs to revise broker
marketing materials, forms, and orders
for service, including technical writing
and printing costs associated with
incorporating mandated consumer
information pamphlets; and (3)
additional information collection
burdens associated with the new
regulations, especially information
collection burdens to travel to and
perform on-site physical surveys for
written estimates, information
collection burdens to make written
agreements with household goods motor
carriers, and information collection
burdens to verify household goods
motor carrier authority/insurance
validity.

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Federal Register / Vol. 72, No. 26 / Thursday, February 8, 2007 / Proposed Rules

Regulatory Flexibility Act, as Amended
by the Small Business Regulatory
Enforcement Fairness Act of 1996
The Regulatory Flexibility Act (RFA)
(5 U.S.C. 601–612), as amended by the
Small Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104–121,
110 Stat. 857), requires Federal
agencies, as a part of each rulemaking,
to consider regulatory alternatives that
minimize the impact on small entities
while achieving the objectives of the
rulemaking. FMCSA has evaluated the
effects of this proposed rule on small
entities as required by the RFA. This
proposed rule directly affects all
household goods brokers required to
register with FMCSA, of which there are
approximately 690 active, registered
household goods brokers. FMCSA
estimates 100 percent of these registered
household goods brokers are small
entities. FMCSA believes, based on its
draft Regulatory Evaluation, that this
proposed rule will not have a significant
impact on a substantial number of small
entities, but there remains some
uncertainty as to the impacts to
individual household goods brokers.
FMCSA has prepared an Initial
Regulatory Flexibility Analysis. A copy
of the Initial Regulatory Flexibility
Analysis can be found attached to the
draft Regulatory Evaluation in docket
FMCSA–2004–17008. (See the last three
pages of the Regulatory Evaluation.)
FMCSA has chosen not to certify at this
stage of the rulemaking that a significant
impact will not occur and welcomes
comments on our analysis and findings.
Unfunded Mandates Reform Act
This proposed rule does not impose a
Federal mandate resulting in the
expenditure by State, local, or tribal
governments, in the aggregate, or by the
private sector, of $128.1 million or more
in any one year (2 U.S.C. 1531 et seq.).
National Environmental Policy Act
The agency analyzed this proposed
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 (69 FR 9680), that this
action is categorically excluded (CE)

under Appendix 2, paragraphs 6.d, 6.m,
and 6.q of the Order from further
environmental documentation. These
categorical exclusions relate to
rulemaking actions affecting household
goods brokers. In addition, the agency
believes that the action includes 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.
We have also analyzed this proposed
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 and policy development and
issuance. See 40 CFR 93.153(c)(2). It
would 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 the rule
would not increase total CMV mileage,
change the routing of CMVs, how CMVs
operate, or the CMV fleet-mix of motor
carriers. This action merely establishes
regulations applicable to the business
practices of household goods brokers,
who do not operate CMVs.
We seek comment on these
determinations.
Privacy Impact Assessment
FMCSA conducted a privacy impact
assessment of this proposed rule as
required by Section 522(a)(5) of the FY
2005 Omnibus Appropriations Act, Pub.
L. 108–447, 118 Stat. 3268 (Dec. 8, 2004)
[set out as a note to 5 U.S.C. § 552a]. The
assessment considers any impacts of the
proposed rule on the privacy of
information in an identifiable form and
related matters. FMCSA has determined
this proposal contains no privacy
impacts.
Paperwork Reduction Act
Under the Paperwork Reduction Act
of 1995 (PRA) (44 U.S.C. 3501–3520), a
Federal agency must obtain approval
from the Office of Management and

Budget (OMB) for each collection of
information it conducts, sponsors, or
requires through regulations. FMCSA
will seek approval of the information
collection requirements in a new
information collection to be entitled
‘‘Practices of Household Goods
Brokers.’’
The collected information
encompasses that which is generated,
maintained, retained, disclosed, and
provided to, or for, the agency under 49
CFR part 371. It will assist shippers in
their commercial dealings with
interstate household goods brokers. The
collection of information will be used
by prospective shippers to make
informed decisions about contracts and
services to be ordered, executed, and
settled within the interstate household
goods motor carrier industry. These
information collection items were
required by regulations issued by the
former ICC; however, that agency was
not required to comply with the PRA.
When these items transferred from the
ICC to the Federal Highway
Administration, and ultimately to
FMCSA, no OMB control number was
assigned to cover this information
collection transfer. It was therefore
necessary to calculate the old
information collection burden hours for
these items approved under the ICC
rules and to add the new burden that
may be generated by this proposal.
Assumptions used for calculation of
the information collection burden
include the following: (1) There are
currently approximately 690 interstate
household goods brokers; and (2)
FMCSA estimates 125 new household
goods brokers will register with FMCSA
each year, making them subject to
FMCSA regulations.
Table 1 summarizes the information
collection burden hours by correlating
the information collection activities
with the sections of part 371 in which
they appear. See attachment A of the
supporting statement for the Paperwork
Reduction Act Submission in docket
FMCSA–2004–17008 for the detailed
FMCSA analysis. The table shows
whether each information collection
activity was required under ICC
regulations in 1995.

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TABLE 1
Type of burden

Proposed
section

Household Goods Broker Transactions .........................................................
Separate accounting system 6 ........................................................................
Web site and Advertisement Information .......................................................
List and Statement .........................................................................................

Old 371.3 ..........
Old 371.13 ........
371.107 ............
371.109 ............

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First yr.
burden

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41,400
1,000
173
173

08FEP1

Annual hourly
burden
41,400
1,000
32
32

New burden?
No.
No.
Yes.
Yes.

5955

Federal Register / Vol. 72, No. 26 / Thursday, February 8, 2007 / Proposed Rules
TABLE 1—Continued
Type of burden

Proposed
section

First yr.
burden

Annual hourly
burden

Adding Hyperlinks on Household Goods Broker Web site to FMCSA Booklet Information ‘‘Ready to Move’’ and ‘‘Your Rights and Responsibilities
When You Move’’.
Distribute FMCSA’s Booklets .........................................................................
Distribute Household Goods Motor Carrier’s Booklets ..................................
Shipper’s Signed and Dated Statement .........................................................
Travel to location within 50 air miles of broker and physically survey
household goods.
Written agreement with household goods motor carrier ................................
Disclose cancellation, deposit, and refund policies .......................................
Disposition of shipper’s cancel request .........................................................
Carrier monthly operating authority status check ..........................................

371.111(a)(1) ....

311

57

Yes.

371.111(a)(2) ....
371.111(a)(3) ....
371.111(b)&(c) ..
371.113 ............

1,250
1,250
29,140
37,500

1,250
1,250
29,140
37,500

Yes.
Yes.
Yes.
Yes.

371.115 ............
371.117(a) ........
371.117(b) ........
371.119 ............

13,800
173
250
1,400

2,500
32
250
1,400

Yes.
Yes.
Yes.
Yes.

‘‘Old’’ Burden Hours ................................................................................
New Burden Hours ..................................................................................

...........................
...........................

42,400
85,420

42,400
73,450

Total Burden Hours for This Information Collection ........................

...........................

127,820

115,850

New burden?

6 FMCSA

believes setting up the first accounting system for a new business is a usual and customary business practice. The PRA regulations
at 5 CFR 1320.3(b)(2) allows FMCSA to calculate no burden when the agency demonstrates to OMB that the activity needed to comply with the
specific regulation is usual and customary. The supporting statement in the docket demonstrates that setting up and accounting system is a
usual and customary practice when starting a new business. FMCSA seeks comment on whether setting up the first accounting system for a
new business is a usual and customary business practice.

Executive Order 13211 (Energy Effects)

Executive Order 12988 (Civil Justice
Reform)
This rulemaking meets applicable
standards in sections 3(a) and 3(b)(2) of
Executive Order 12988, entitled ‘‘Civil
Justice Reform,’’ to minimize litigation,
eliminate ambiguity, and reduce
burden.
Executive Order 13045 (Protection of
Children)
FMCSA has analyzed this proposal
under Executive Order 13045, entitled
‘‘Protection of Children from
Environmental Health Risks and Safety
Risks.’’ The agency does not believe this
proposed rulemaking would be
economically significant, nor does it
concern an environmental risk to health
or safety that may disproportionately
affect children.

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Executive Order 12630 (Taking of
Private Property)

FMCSA has analyzed this proposed
action under Executive Order 13211,
entitled ‘‘Actions Concerning
Regulations That Significantly Affect
Energy Supply, Distribution, or Use.’’
The agency has determined that it is not
a ‘‘significant energy action’’ under that
order because it does not appear to be
economically significant (i.e., a cost of
more than $100 million in a single year)
based upon analyses performed at this
stage of the rulemaking process, and is
not likely to have a significant adverse
effect on the supply, distribution, or use
of energy.

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

Executive Order 13132 (Federalism)

Advertising, Arbitration, Consumer
protection, Freight, Highways and
roads, Insurance, Motor carriers, Moving
of household goods, Reporting and
recordkeeping requirements.

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49 CFR Part 371
Brokers, Motor carriers, Reporting and
recordkeeping requirements.
49 CFR Part 375

49 CFR Part 386
Administrative practice and
procedure, Brokers, Freight forwarders,
Hazardous materials transportation,

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49 CFR Part 387
Buses, Freight, Freight forwarders,
Hazardous materials transportation,
Highway safety, Insurance,
Intergovernmental relations, Motor
carriers, Motor vehicle safety, Moving of
household goods, Penalties, Reporting
and recordkeeping requirements, Surety
bonds.
For the reasons discussed above,
FMCSA proposes to amend title 49,
Code of Federal Regulations, chapter III,
subchapter B, as set forth below:
PART 371—BROKERS OF PROPERTY

Executive Order 12372
(Intergovernmental Review)

This proposed rule would not effect a
taking of private property or otherwise
have taking implications under
Executive Order 12630, entitled
‘‘Governmental Actions and Interference
with Constitutionally Protected Property
Rights.’’
This proposed action has been
analyzed in accordance with the
principles and criteria contained in
Executive Order 13132. The FMCSA has
determined that this rulemaking would
not have a substantial direct effect on
States, nor would it limit the policymaking discretion of the States.

Highway safety, Motor carriers, Motor
vehicle safety, Penalties.

1. Revise the authority citation for
part 371 to read as follows:
Authority: 49 U.S.C. 13301, 13501, and
14122; subtitle B, title IV of Pub. L. 109–59;
and 49 CFR 1.73.

2. Amend part 371, by adding a new
subpart B to read as follows:
Subpart B—Special Rules for Household
Goods Brokers
Sec.
371.101 If I operate as a household goods
broker in interstate or foreign commerce,
must I comply with subpart B of this
part?
371.103 What are the definitions of terms
used in this subpart?
371.105 Must I use a motor carrier that has
a valid U.S. DOT number and valid
operating authority issued by FMCSA to
transport household goods in interstate
or foreign commerce?
371.107 What information must I display in
my advertisements and Internet web
homepage?

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371.109 Must I inform individual shippers
which motor carriers I use?
371.111 Must I provide individual shippers
with Federal consumer protection
information?
371.113 May I provide individual shippers
with a written estimate?
371.115 Must I maintain agreements with
motor carriers before providing written
estimates on behalf of these carriers?
371.117 Must I provide individual shippers
with my policies for canceling a
shipment?
371.119 What must I do before I arrange
with a motor carrier to transport
household goods in interstate or foreign
commerce?
371.121 What penalties may FMCSA
impose for violations of this part?

Subpart B—Special Rules for
Household Goods Brokers
§ 371.101 If I operate as a household
goods broker in interstate or foreign
commerce, must I comply with subpart B of
this part?

Yes, you must comply with all
regulations in this subpart if you operate
as a household goods broker in
interstate or foreign commerce.
§ 371.103 What are the definitions of terms
used in this subpart?

Household goods has the same
meaning as the term is defined in
§ 375.103 of this subchapter.
Household goods broker means a
person, other than a motor carrier or an
employee or bona fide agent of a motor
carrier, that as a principal or agent sells,
offers for sale, negotiates for, or holds
itself out by solicitation, advertisement,
or otherwise as selling, providing, or
arranging for, transportation of
household goods by motor carrier for
compensation.
Individual shipper has the same
meaning as the term is defined in
§ 375.103 of this subchapter.
§ 371.105 Must I use a motor carrier that
has a valid U.S. DOT number and valid
operating authority issued by FMCSA to
transport household goods in interstate or
foreign commerce?

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You may only act as a household
goods broker for a motor carrier that has
a valid U.S. DOT number and valid
operating authority issued by FMCSA to
transport household goods in interstate
or foreign commerce.
§ 371.107 What information must I display
in my advertisements and Internet web
homepage?

(a) You must prominently display in
your advertisements and Internet web
homepage(s) the physical location(s)
(street or highway address) where you
conduct business.
(b) You must prominently display
your U.S. DOT registration number(s)

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and MC license number issued by the
FMCSA in your advertisements and
Internet web homepage(s).
(c) You must prominently display
your status as a household goods broker
in your advertisements and Internet web
homepage(s).
(d) You must prominently display in
your advertisements and Internet web
homepage(s) that you will not transport
an individual shipper’s household
goods, but that you will arrange for the
transportation of the household goods
by an FMCSA-authorized household
goods motor carrier, whose charges will
be determined by its published tariff.
§ 371.109 Must I inform individual shippers
which motor carriers I use?

(a) You must provide to each potential
individual shipper who contacts you a
list of all authorized household goods
motor carriers you use, including their
U.S. DOT registration number(s) and
MC license numbers.
(b) You must provide to each
potential individual shipper who
contacts you a statement stating you are
not a motor carrier authorized by the
Federal Government to transport the
individual shipper’s household goods,
and you are only arranging for an
authorized household goods motor
carrier to perform the transportation
services and, if applicable, additional
services.
§ 371.111 Must I provide individual
shippers with Federal consumer protection
information?

(a) You must provide potential
individual shippers with Federal
consumer protection information by one
of the following three methods:
(1) Provide a hyperlink on your
Internet web home page to the FMCSA
Web page containing the information in
FMCSA’s publications ‘‘Ready to
Move?—Tips for a Successful Interstate
Move’’ and ‘‘Your Rights and
Responsibilities When You Move.’’
(2) Distribute to each shipper and
potential shipper at the time you
provide an estimate, copies of FMCSA’s
publications ‘‘Ready to Move?—Tips for
a Successful Interstate Move’’ and
‘‘Your Rights and Responsibilities When
You Move.’’
(3) Distribute to each shipper and
potential shipper at the time you
provide an estimate, copies of ‘‘Ready to
Move?—Tips for a Successful Interstate
Move’’ and ‘‘Your Rights and
Responsibilities When You Move’’ as
modified and produced by the
authorized, lawful motor carrier you
intend to provide the shipment to under
your written agreement required by
§ 371.115.

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(b) You must obtain a signed, dated
electronic or paper receipt showing the
individual shipper has received both
booklets.
(c) You must maintain the signed
receipt required by paragraph (b) of this
section for three years from the date the
individual shipper signs the receipt.
§ 371.113 May I provide individual
shippers with a written estimate?

(a) You may provide each individual
shipper with an estimate of
transportation and accessorial charges.
If you provide an estimate, it must be in
writing and must be based on a physical
survey of the household goods if the
household goods are located within a 50
air-mile radius of your or your agent’s
location. The estimate must be prepared
in accordance with a signed, written
agreement, as specified in § 371.115 of
this subpart.
(b) You must base your estimate upon
the published tariffs of the authorized
motor carrier who will transport the
shipper’s household goods.
(c) A shipper may elect to waive the
physical survey required in paragraph
(a) of this section by written agreement
signed by the shipper before the
shipment is loaded. A copy of the
waiver agreement must be retained as an
addendum to the bill of lading and is
subject to the same record inspection
and preservation requirements as are
applicable to bills of lading.
(d) You must keep the records
required by this section for three years
following the date you provide the
written estimate for an individual
shipper who accepts the estimate and
has you procure the transportation.
§ 371.115 Must I maintain agreements with
motor carriers before providing written
estimates on behalf of these carriers?

(a) In order to provide estimates of
charges for the transportation of
household goods, you must do so in
accordance with the written agreement
required by § 375.409 of this subchapter.
Your written agreement with the motor
carrier(s) must include the following
items:
(1) Your broker name as shown on
your FMCSA registration, your physical
address, and your U.S. DOT registration
number or MC license number;
(2) The authorized motor carrier’s
name as shown on its FMCSA
registration, its physical address, and its
U.S. DOT registration number and MC
license number;
(3) A concise, easy to understand
statement that your written estimate or
quote to the individual shipper:
(i) Will be exclusively on behalf of the
authorized household goods motor
carrier;

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(ii) Will be based on the authorized
household goods motor carrier’s
published tariff; and
(iii) Will serve as the authorized
household goods motor carrier’s
estimate for purposes of complying with
the requirements of part 375 of this
chapter, including the requirement that
the authorized household goods motor
carrier relinquish possession of the
shipment upon payment of no more
than 110 percent of the estimate at the
time of delivery;
(4) Your owner’s, corporate officer’s,
or corporate director’s signature
lawfully representing your household
goods broker operation and the date;
(5) The signature of the authorized
household goods motor carrier’s owner,
corporate officer, or corporate director
lawfully representing the household
goods motor carrier’s operation and the
date; and
(6) A notary public’s signature, date,
and seal notarizing and attesting to the
validity of the signatures on the
agreement between the household goods
broker and household goods motor
carrier.
(b) The signed written agreement
required by this section is public
information and you must produce it for
review upon reasonable request by a
member of the public.
(c) You must keep copies of the
agreements required by this section for
as long as you provide estimates or
quotes on behalf of the authorized
household goods motor carrier and for
three years thereafter.

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§ 371.117 Must I provide individual
shippers with my policies for canceling a
shipment?

(a) You must disclose prominently on
your Internet Web site and in your
agreements with prospective shippers
your cancellation policy, deposit policy,
and policy for refunding deposited
funds in the event the shipper cancels
an order for service before the date an
authorized household goods motor
carrier has been scheduled to pick up
the shipper’s property.
(b) You must maintain records
showing each individual shipper’s
request to cancel a shipment and the
disposition of each request for a period
of three years after the date of a
shipper’s cancellation request. If you
refunded a deposit, your records must
include:
(1) Proof that the individual shipper
cashed or deposited the check or money
order, if the financial institution
provides documentary evidence; or
(2) Proof that you delivered the refund
check or money order to the individual
shipper.

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§ 371.119 What must I do before I arrange
with a motor carrier to transport household
goods in interstate or foreign commerce?

(a) Using the FMCSA’s database
systems, you must verify and document
each month that household goods motor
carriers with whom you arrange
transportation have an active U.S. DOT
registration number, active for-hire
operating authority from FMCSA to
transport household goods in interstate
or foreign commerce, and that the
household goods motor carrier has
evidence of the necessary insurance
coverage on file with FMCSA.
(b) You must maintain the verification
documents in paragraph (a) of this
section for three years from the date you
arrange for a shipment on behalf of an
individual shipper by a household
goods motor carrier.
§ 371.121 What penalties may FMCSA
impose for violations of this part?

The penalty provisions of 49 U.S.C.
Chapter 149, Civil and Criminal
Penalties apply to this subpart. These
penalties do not overlap.
Notwithstanding these civil penalties,
nothing in this section deprives an
individual shipper of any remedy or
right of action under existing law.
PART 375—TRANSPORTATION OF
HOUSEHOLD GOODS IN INTERSTATE
COMMERCE; CONSUMER
PROTECTION REGULATIONS
3. Revise the authority citation for
part 375 to read as follows:
Authority: 5 U.S.C. 553; 49 U.S.C. 13301,
13704, 13707, 14104, 14706; subtitle B, title
IV of Pub. L. 109–59; and 49 CFR 1.73.

4. Revise § 375.409 to read as follows:
§ 375.409 May household goods brokers
provide estimates?

(a) Household goods brokers may
provide estimates provided there is a
written agreement between the broker
and you, the motor carrier, adopting the
broker’s estimate as your own estimate.
If you, the motor carrier, make such an
agreement with a household goods
broker, you must ensure compliance
with all requirements of this part
pertaining to estimates, including the
requirement that you must relinquish
possession of the shipment if the
shipper pays you no more than 110
percent of a non-binding estimate at the
time of delivery.
(b) Your written agreement with the
household goods broker(s) must include
the items required in § 371.115(a) of this
subchapter.

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5957

PART 386—RULES OF PRACTICE FOR
MOTOR CARRIER, BROKER, FREIGHT
FORWARDER, AND HAZARDOUS
MATERIALS PROCEEDINGS
5. Revise the authority citation for
part 386 to read as follows:
Authority: 49 U.S.C. 113, chapters 5, 51,
59, 131–141, 145–149, 311, 313, and 315; sec.
206, Pub. L. 106–159, 113 Stat. 1763; subtitle
B, title IV of Pub. L. 109–59; and 49 CFR 1.45
and 1.73.

6. Amend appendix B to part 386 by
revising the heading and by adding
paragraphs (g)(21) and (22) to read as
follows:
Appendix B to Part 386—Penalty
Schedule; Violations and Monetary
Penalties
*

*

*

*

*

(g) * * *
(21) A broker for transportation of
household goods who makes an estimate of
the cost of transporting any such goods
before entering into an agreement with a
motor carrier to provide transportation of
household goods subject to FMCSA
jurisdiction is liable to the United States for
a civil penalty of not less than $10,000 for
each violation.
(22) A person who provides transportation
of household goods subject to jurisdiction
under 49 U.S.C. chapter 135, subchapter I, or
provides broker services for such
transportation, without being registered
under 49 U.S.C. chapter 139 to provide such
transportation or services as a motor carrier
or broker, as the case may be, is liable to the
United States for a civil penalty of not less
than $25,000 for each violation.

PART 387—MINIMUM LEVELS OF
FINANCIAL RESPONSIBILITY FOR
MOTOR CARRIERS
7. The Authority citation for part 387
continues to read as follows:
Authority: 49 U.S.C. 13101, 13301, 13906,
14701, 31138, and 31139; and 49 CFR 1.73.

8. Amend § 387.307 by redesignating
paragraph (a) as paragraph (a)(1) and
adding new paragraph (a)(2) to read as
follows:
§ 387.307 Property broker surety bond or
trust fund.

(a) Security.
(1) * * *
(2) A household goods broker must
have a surety bond or trust fund in
effect for $25,000. The FMCSA will not
issue a household goods broker license
until a surety bond or trust fund for the
full limits of liability prescribed herein
is in effect. The household goods broker
license remains valid or effective only
as long as a surety bond or trust fund
remains in effect and ensures the
financial responsibility of the household
goods broker.
*
*
*
*
*

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Issued on: February 2, 2007.
John H. Hill,
Administrator.
[FR Doc. E7–2106 Filed 2–7–07; 8:45 am]

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BILLING CODE 4910–EX–P

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