By Jami Jones, managing editor
Despite a newly enacted regulation targeting reincarnated motor carriers, the Federal Motor Carrier Safety Administration is continuing to accept cross-border program applications that fail to disclose affiliations.
Two of the latest three Mexico-based motor carriers that have applied for long-haul authority in the U.S. failed to disclose affiliations with other motor carriers, according to protest letters from the Owner-Operator Independent Drivers Association.
Neither Servicios Refrigerados Internacionales nor Higienicos y Desechables Del Bajio presented applications to FMCSA acknowledging any motor carrier affiliations. And, in one case, the agency has proven knowledge of those affiliations.
"Servicios Refrigerados was a participant in the previous demonstration project involving Mexican trucks. In the PASA (pre-authority safety audit) review of Servicios Refrigerados conducted for the demonstration project, FMCSA noted that this carrier had an affiliate named SRI Trucking LLC, based in San Diego, CA," OOIDA President Jim Johnston wrote in the Association's protest letter to FMCSA.
That affiliation is not disclosed in Servicios' most recent application.
Higienicos y Desechables Del Bajio – dubbed HYD in another OOIDA protest letter directed at that motor carrier – also failed to disclose affiliations.
"OOIDA has identified a carrier that appears to be affiliated with, or is a prior incarnation of, HYD: Comercializadora, Mexicana Trading Inc., doing business as Higienicos Y Desechables Del Bajio SA DE CV," Johnston wrote in the protest letter.
Johnston went on to point out that the "doing business as" names of the two companies are identical, as are the mailing addresses and listed agents.
The application for authority states that "willful misstatement or omission of material facts constitute Federal criminal violations … and that each offense is punishable by up to 5 years imprisonment."
Both the Servicios Refrigerados and HYD applications were signed by individuals verifying the truthfulness of the applications.
The timing of the incomplete applications corresponds with the agency's new chameleon carrier or reincarnated carrier regulation. That regulation is designed to prevent motor carriers facing enforcement activities from closing under one name and opening under another.
As part of that regulation, motor carriers are required to fully disclose all affiliations.
That shortcoming was highlighted in both of OOIDA's recent protest letters.
"The existence of an affiliated motor carrier is a material fact," Johnston wrote. "In a recent final rule, FMCSA announced that its knowledge of the existence of a motor carrier's or its principals' prior affiliations or incarnations is critical in order to perform a proper analysis of the motor carrier's, or its principals', safety management practices."
These are not the first applications submitted to FMCSA that have failed to disclose affiliations.
Baja Express applied for the cross-border program in early March. In its application it also failed to disclose an affiliation with any motor carrier. OOIDA identified affiliations with at least two motor carriers.
In response to OOIDA's protest of Baja Express' application, FMCSA Associate Administrator for Enforcement and Program Delivery William Quade said the fact the application was made public was a mistake.
"We do … acknowledge that OOIDA's letter correctly noted that Baja Express is affiliated with Carlos Tirado Valdez," Quade wrote in a letter to OOIDA.
"Baja Express had not indicated this relationship on its original application. Prior to conducting the PASA on Baja Express, FMCSA learned of the relationship between Baja Express and Carlos Tirado Valdez. Baja Express updated its application to correct this error, and to reflect the relationship with this other commercial zone carrier."
Quade went on to explain that FMCSA posted the original, "incomplete" version of Baja Express' application to the FMCSA website.
The agency went on to approve Baja Express' application on March 30. At that time, only 14 trips into the U.S. had been made as part of the cross-border program since Oct. 21, 2011.
Since Baja Express joined the program, the number of long-haul trips was at 33 as of press time, with Baja accounting for a third of all crossings in less than six weeks. LL