2024-27115. Transparency in Property Broker Transactions

Table 1—Wage, Time, and Labor Costs

[In 2023]

Occupation	BLS occupation code	NAICS occupational designation	Median base wage	Fringe benefits rate (%)	Overhead rate (%)	Median base wage + fringe benefits + overhead
Office Clerks, General 1	43-9061	Cross-industry	$19.46	48.2	21	$33
FMCSA estimates that an office clerk could spend up to 5 minutes per document to create an electronic copy of that transaction record, at an hourly wage rate of $33. Therefore, the cost to create an electronic copy of each document would be up to $2.75 (5 ÷ 60 × $33) per record.
Note: Industry wage with benefits and overhead is hourly and has been rounded to the nearest dollar.
1  DOL, BLS. Occupational Employment and Wage Statistics (OEWS). National. May 2023. 43-9061 Office Clerks, General. Available at: https://www.bls.gov/​oes/​current/​oes439061.htm (accessed Apr. 18, 2024).

Revisions to the Required Contents of Brokers' Records

The Agency proposes updating the content of records under § 371.3(a) to include the date of payment for brokered services. The Agency believes this proposal would impose a minimal burden as most brokers likely already retain payment dates for brokered services as part of their standard transaction and accounting processes. Under this proposal, brokers would be required to update the contents of records kept under § 371.3 to include dates of payment. While the Agency cannot quantify the cost impact to include payment dates in records kept under § 371.3, due to the limitations of available data, FMCSA expects it would be de minimis due to the minor adjustments that would be required to comply with this proposal, as discussed previously. FMCSA proposes this requirement in response to comments both to the OOIDA and SBTC petitions and to an FMCSA Broker Listening Session at MATS in March 2023, where ( print page 91663) multiple commenters discussed charge backs and claims after loads were delivered. The Agency believes the inclusion of a date of payment would provide additional information to motor carriers that they may use to counter any inaccurate claims. For example, date of payment information may aid a carrier to establish a timeline of events, such as payments to the broker by the shipper, and possibly aid in rectifying discrepancies and spurious charge backs with brokered freight contracts. The Agency lacks data to quantify the amount of fraudulent or inaccurate charge backs imposed on motor carriers but concludes that there would be some cost savings for motor carriers if they are able more readily to contest these charges with the increased transparency information.

The Agency also proposes to eliminate the distinction between brokerage services and non-brokerage services in § 371.3(a) by removing paragraph (5) and revising paragraph (4). The rationale for the distinction was initially set out in the brokers of property rule promulgated by the ICC in 1949, as detailed earlier in this NPRM in section V.A. History of Property Broker Regulations. In the past, the ICC attempted to regulate broker fees by setting a cap, but this relied on differentiating between brokerage and non-brokerage services. However, the broker fee cap was never adopted. With the current focus on transparency in broker transactions, the distinction between these service types is no longer necessary. The Agency, therefore, proposes to require that the records contain all charges and payments connected to the shipment. This proposed change is consistent with the obligation imposed on federal agencies by the Plain Writing Act of 2010. This law requires that federal agencies use, “clear Government communication that the public can understand and use.” ^[14] As this proposed amendment does not change the contents of records under § 371.3, the Agency finds that there would be no economic impact associated with the modernization of this language.

Brokers Must Provide Records Upon Request

FMCSA is proposing to amend the language of § 371.3(c) to state that brokers have an obligation to disclose records within 48 hours of request. The prevalence of waivers may be reduced through the framing of this regulatory obligation. Broker transparency is intended as a mechanism to allow parties to a brokered freight transaction to self-police the performance of the transaction. A free market in the brokered freight industry would represent a scenario where the demand, supply, and prices of brokered transportation of property are determined by the parties to these brokered transactions, i.e., shippers, brokers, and motor carriers. However, free markets require transparency to operate efficiently. When parties to a brokered transaction have unequal access to relevant information, known as information asymmetry, that could lead to an inefficient allocation of resources and therefore a sub-optimal outcome for society. Since waivers of § 371.3 inhibit the sharing of information in brokered freight transactions, these waivers may create some degree of market failure or inefficiency.

A party to a brokered transaction may seek records under § 371.3(c) for various reasons, including, but not limited to the following:

• Motor carriers may seek transaction records in furtherance of a remedy against potential charge back abuses or other erroneous charges on completed loads. For example, if the broker made a concession to the owner of a brokered load and attempted to recapture these funds from the carrier, this could be verified by the carrier through transaction records requested under § 371.3. It is evident from the comments received that some motor carriers believe spurious charge backs can be identified if motor carriers have access to transparency information.
• Shippers may use transaction records to verify that the services that they were billed for by the broker were provided. This can help to prevent fraud or errors in billing.
• Motor carriers and shippers may seek transparency on broker margins. Although a party to a brokered contract would have access to transaction records under § 371.3 only after the contractual service has been completed, carrier and shippers could use this information determine whether the margins are commensurate with the service provided, and potentially to negotiate for better rates or turn to other brokers for future loads. If many motor carriers and shippers were to make a similar decision, some brokers might find it difficult to contract out loads and therefore would face pressure to offer better rates and therefore improved margins for motor carriers.
• Motor carriers and shippers may use transaction information to identify instances where loads have been brokered without authority and to report such instances to FMCSA.
• Motor carriers believe less time would be spent resolving disputes if transaction information is readily available. Several reports submitted to FMCSA indicate that motor carriers have spent considerable time seeking such information or resolving issues stemming from its absence.

FMCSA does not regulate freight rates or broker margins. The proposed rule would reframe the existing regulation that requires the broker to provide a record of the transaction to the motor carrier on request after the transaction is complete, but it would not regulate rates or margins. The Agency believes that this transparency could have some impact on rates and margins, and the current prevalence of waivers suggests that brokers likely derive some benefit from not providing transaction records to motor carriers. However, the Agency also believes that the proposed rule may have only a minimal impact on rates and margins, and other factors may still predominate in the setting of rates and margins. The possibility of a minimal impact is supported by the wide availability of rate information and the fact that carriers would only receive the transparency information after a transaction is completed, i.e., after the rate is negotiated. Due to the limitations of available data, FMCSA cannot judge the likely impact and the Agency seeks further information to determine the degree of impact.

To gain a clearer understanding of the impact of clarifying brokers' obligations to provide records under § 371.3, the Agency examined market conditions in the freight brokerage industry over the past few years. According to data from the U.S. Census Bureau, revenues for freight brokers increased, in aggregate, from 2019 to 2021.^[15] While the Census Bureau data shows a decrease in motor carrier revenues from 2019 to 2020, it also shows a rebound in motor carrier's revenue in 2021. Truck driver wages also showed continuous growth during 2019 to 2021. A study conducted by the American Trucking Associations also shows average wage increased for truck drivers by 18% between 2019 and 2021.^[16] The COVID-19 emergency also ( print page 91664) resulted in reduced costs for motor carriers. According to a report published by The Trucker, motor carriers benefitted from reduced costs in fuel and increased fuel economy due to lower traffic levels. Motor carriers' marginal operating costs per mile correspondingly decreased by approximately 5 cents.^[17] These cost savings would have helped to offset the reduction in revenues for the industry during the COVID-19 national emergency.

The number of brokers with operating authority grew by 20.90 percent from 2020 to 2021. Similarly, the number of motor carriers with operating authority grew by 18.81 percent from 2020 to 2021. Public industry data shows that rates for brokered freight loads rebounded from their COVID-19 downturn in late 2020 and peaked in 2022.^[18] Figure 1 provides a visual display of the relative change in brokered freight rates over time. The Agency finds that the rapid entry of new motor carriers into the market during 2022 was driven by a surge in freight demand beginning in 2021, with new brokers and motor carriers intending to capitalize on unprecedented market conditions. These conditions included government subsidies such as the COVID-19 economic impact payments, the Paycheck Protection Program (PPP), lower marginal costs and relatively high rates for trucking loads as seen in Figure 1.

By 2023, however, as a market correction emerged, brokers and motor carriers began leaving the market. As the initial pandemic response waned, demand began to normalize which led to an oversupply of capacity and subsequent broker and carrier exits. Freight rates also came down from their 2022 peak. Such rapid expansion, as seen in 2021, was unlikely to be sustainable, and a natural correction towards a new equilibrium was anticipated. However, the Agency finds that the average rate for a brokered load and the total number of motor carriers and brokers holding active authority remain at levels higher than their pre-pandemic numbers, indicative of a freight industry more robust than when OOIDA and SBTC submitted their petitions. This, combined with a study published in January 2024, indicating average broker margins of approximately 13.47 percent to 15.4 percent, depending on the configuration of the truck, suggests a period of favorable margins for both brokers and motor carriers.^[19]

In conclusion, analysis of available data suggests that brokerage margins generally align with the self-reported industry averages of approximately 15 percent. The Agency posits that isolated instances of higher margins are not indicative of broader trends within the industry. Instead, the Agency maintains that pricing trends in the brokerage industry are tied to market factors.

Table 2—Year-Over-Year Changes of Active Brokers and Motor Carriers ¹

Year	Total brokers registered	Total brokers percentage change	Total motor carriers registered	Carrier percentage change
2015	16,745		551,150
2016	17,764	6.09	524,058	−4.92
2017	18,637	4.91	543,061	3.63
2018	20,154	8.14	586,720	8.04
2019	21,770	8.02	602,542	2.70
2020	24,138	10.88	637,721	5.84
2021	29,184	20.90	757,652	18.81
2022	31,885	9.26	813,844	7.42
2023	28,773	−9.76	787,189	−3.28
1  Pocket Guide to Large Truck and Bus Statistics, FMCSA. Available at: https://www.fmcsa.dot.gov/​safety/​data-and-statistics/​commercial-motor-vehicle-facts (accessed Jun. 10, 2024). Data for each year is captured at year end.

FMCSA understands that several factors influence freight brokerage pricing including, but not limited to:

1. Costs of fulfilling contractual obligations e.g., fuel, labor, depreciation of equipment, licensing, insurance, taxes;

2. Market rate information;

3. Demand by motor carriers for brokered loads;

4. The supply of brokered load contracts on the market;

5. Seasonal demand, i.e., the changes in demand for brokered loads depending on the time of year;

6. Type of commodity; and

7. Existing economic conditions, e.g., COVID-19 national emergency, recession.

The Agency believes that these factors, rather than the availability of additional information concerning broker margins, are likely dominant for pricing brokered loads. Through comments submitted by industry stakeholders, FMCSA understands that broker records would be of limited utility in negotiating contracts due to the effect of the pricing factors listed above, as such records are provided only upon request and after the completion of the contractual obligations. Therefore, the records may only be useful for negotiating pricing for future loads. However, a broker may refuse such negotiations by claiming that all the pricing factors for the load are not the same.

Any shift in pricing in the brokered freight industry would take the form of transfers. A transfer in this context would be a shift in revenue from one party to another, specifically from brokers to motor carriers. FMCSA cannot predict the magnitude or frequency of any transfers between parties to brokered transactions but believes transfers could occur because of this proposed rule.

The Agency is unable to quantitatively estimate the magnitude or frequency of any transfers due to lack of data on:

1. How many transactions under § 371.3 are waived;

2. The number of transactions in the brokered freight industry;

3. The margins of brokers and motor carriers throughout the industry; and

4. The degree to which those margins are impacted by waivers to the current regulation.

The Agency believes transfers may occur based on the following factors:

1. A significant number of motor carriers have said they intend to use transparency information to negotiate for better rates. However, as discussed previously, FMCSA believes the content of records under § 371.3 would be of limited utility in negotiating rates;

2. Brokers who currently use § 371.3 waivers may relinquish some degree of competitive advantage if the proposed rule is effective at reducing the frequency at which these brokers use waivers to the regulation. If brokers currently price the value of this competitive advantage into their brokerage contracts, their ability to maintain current margins could be weakened; and

3. If this proposal were to effectively reduce the prevalence of waivers then carriers may be better able to detect unauthorized brokering by examining transparency data to identify the parties involved in the brokered transaction. Carriers could then report suspected unauthorized brokering to FMCSA for enforcement action. If these measures successfully reduce unauthorized brokering, then those profits could potentially be redirected to motor carriers and brokers with the appropriate authority.

FMCSA also acknowledges that transfers need not be large, as a percentage of total industry revenue, to meet the economically significant threshold of $200 million, under E.O. 14094. The Agency estimates the actual revenues specific to the broker entities subject to this regulation range from $11.6 billion ^[20] to $65 billion ^[21] per year. Additional revenue estimates for the entire industry also include $16.58 billion.^[22] The Agency has no industry revenue information specific to brokers that would be impacted by this rulemaking. Due to limitations in available data, it is not possible to isolate revenue estimates specifically for brokers subject to this proposed rulemaking. Since these brokers represent a subset of the overall U.S. brokerage industry, their revenue is unlikely to be at the upper end of this range.

The maximum percentage of transfers that could occur in response to this rulemaking without reaching the economically significant threshold of $200 million of impacts in any 1 year ranges from 1.7 percent ^[23] to 0.3 percent.^[24] As discussed, the Agency believes the economic threshold for significance is likely closer to 1.7 percent than to 0.3 percent, as the broker entities subject to this regulation represent a subset of the total number of transportation brokers operating in the United States. The Agency requests comment on the frequency and ( print page 91666) magnitude of transfers that may occur as a result of this rulemaking and invites all interested parties to submit relevant data and information.

It is important to note that any shift away from the current practice of including waivers of § 371.3(c) may present economic disadvantages to brokers. The Agency acknowledges England Logistics' comment that inappropriate solicitation of freight to owners of brokered loads presents a business risk to them. The Agency recognizes that a broker's role extends beyond matching shippers with motor carriers. Brokers act as an extension of the shipper's team, managing and overseeing cargo transportation with the carrier and handling varying documentation. The Agency does not believe that this proposal would materially alter the value proposition offered by brokers to shippers or make brokers less competitive as compared to working directly with motor carriers. Although the proposed rule clarifies that brokers have a regulatory obligation to disclose records upon request, it does not prevent them from including confidentiality clauses in their contracts with motor carriers or shippers.

The proposed amendments to paragraph (c) would not impose any duty on motor carriers. They clarify that the broker has a duty to provide records to the motor carrier upon request, as intended by the current regulation, but the motor carrier is not obligated to request the records. The Agency does not believe that the proposed amendments will impose a cost on motor carriers.

Records Must Be Provided Within 48 Hours of Request

The current regulation lacks a defined timeframe within which brokers must fulfill information requests. The Agency has received reports of motor carriers experiencing lengthy delays in obtaining required information from brokers. The Agency has heard from at least one carrier claiming that a broker asserted that § 371.3, “does not state how long they have, to comply with that request and we can wait 10 years before we give you those records.” ^[25] A defined 48-hour compliance period for brokers to respond to transparency requests under § 371.3 would directly address industry stakeholder concerns about excessive delays.

The Agency acknowledges that the requirement for broker records to be provided within 48 hours may present some costs for brokers. Brokers may need to restructure their processes, invest in IT systems, or develop new IT systems altogether to meet this requirement. Through comments to the OOIDA and SBTC petitions, the Agency understands that not every broker may have pertinent transaction records in the same database, filing system, or transport management system.

Under this proposal, brokers would not be required to produce or create new information. However, some brokers may need to increase total available staffing hours or invest in technology upgrades to meet the 48-hour timeframe. The Agency lacks data to estimate these costs.

The Agency believes that most, if not all, brokers are complying with the current regulation to maintain a record of each transaction in accordance with § 371.3. The Agency is unable to quantify the costs to brokers of providing transparency information within 48 hours due to limited available data on:

1. The total number of transactions processed by brokers that would be subject to the proposed regulation in any given time;

2. The anticipated volume of requests for transaction-specific information under § 371.3; and

3. The technological readiness of brokers to fulfill these requests within the proposed 48-hour timeframe.

However, the Agency believes that some of these costs could be minimally offset by cost savings from having to respond to repeated inquiries from motor carriers for the content of records under § 371.3. The Agency acknowledges that currently motor carriers may, in some instances, submit repeated requests for records under § 371.3, extending over long periods, potentially lasting months. A defined 48-hour compliance period for brokers to respond to transparency requests under § 371.3 would directly address delays in receiving transparency information and therefore mitigate the need for repeated inquiries.

4. Benefits

The primary purpose of this proposed rule is to modernize FMCSA's existing recordkeeping requirements and transparency provisions for brokers and clarify the obligation imposed on brokers to respond to requests for transaction records and the process parties must follow when requesting and supplying such records. The electronic recordkeeping requirement would offer several advantages over paper records. Information can be easily searched and retrieved, eliminating the need to search through physical documents. Electronic records are also less susceptible to loss or damage, as data can be backed up to prevent permanent data loss. A lack of transparency in freight brokerage contracts has been linked to excessive and inappropriate charge backs by brokers. Motor carriers argue that access to broker information mandated by § 371.3 is essential for them to effectively challenge or even verify the legitimacy of charge backs. Without this information, they claim their ability to defend themselves against potentially inaccurate charges is significantly hampered.

The Agency believes the inclusion of the date of payments with the contents of records would provide additional information a carrier may use to counter any inaccurate claims, or spurious charge backs. The intent of the current regulations in § 371.3 is, in part, to enable self-policing of freight-brokered contracts in the absence of more restrictive regulation. The proposed rule would help improve self-policing of freight-brokered contracts on issues such as charge back abuses and unauthorized brokering.

Some motor carriers allege that broker information would enable them to negotiate for better rates. The Agency has not been able to determine the frequency or magnitude of any possible transfers resulting from this rulemaking but acknowledges that motor carriers and shippers may be able to negotiate better rates over time using such information due to a decrease in the information asymmetry present in the brokerage industry. Any resulting shift in revenues between the entities that would be subject to this rulemaking would take the form of transfers. Transfers are not considered to be economic benefits or costs at the societal level.

The Agency believes that broker information would offer limited utility in securing more favorable rates. This belief is based on a few key considerations. First, the pricing of brokered contracts is primarily driven by prevailing market forces. Factors such as the overall economic climate, supply and demand dynamics within the brokerage industry, and other relevant market conditions, as discussed in Section VIII.A.3. Costs, exert a great influence on brokered contract pricing. Second, the information itself would become available only after the contractual obligations have been fulfilled. Because brokered contracts are highly specific, with variation in terms, length, and conditions, information on past contracts would be only minimally applicable for direct comparison in ( print page 91667) future contract negotiations. However, the reduction in information asymmetry due to increased transparency should enable a more efficient market by reducing charge back abuses.

5. Alternatives Considered

The Agency explored alternative approaches, such as a phased implementation, automatic disclosure of the content of records under § 371.3, prohibiting waivers, and a longer timeframe for providing transparency information than the proposed 48 hours. FMCSA decided against these alternative approaches. The Agency finds that a phased implementation would not reduce potential burdens imposed by this proposed rule for the following reasons:

1. Brokers are already obligated to maintain records under § 371.3. Therefore, they possess the information necessary to comply with the proposed 48-hour turnaround for information requests;

2. The Agency believes that most brokers are maintaining a record of their transactions in an electronic format; and

3. Brokers likely capture the date of payment for brokered services as part of their standard transaction and accounting processes.

The OOIDA petition sought a provision making disclosure of the records automatic. OOIDA stated the automatic disclosure was necessary to prevent selective retaliation, i.e., blacklisting, against motor carriers that exercise their right to review the transaction records. The proposed rule does not include an automatic disclosure provision; instead, parties to the transaction would continue to have the ability to review the records upon request. The Agency believes that an automatic disclosure provision would be excessively burdensome to brokers. Though the concerns regarding retaliation appear plausible, the Agency cannot determine how frequently that retaliation would take place. This is, in part, because motor carriers have frequently waived their right to review, which makes it difficult for the Agency to determine if retaliation would be a common problem if the proposed regulation is implemented.

Automatic disclosure would provide the content of records under § 371.3 to all motor carriers, but many motor carriers may choose not to utilize this information. A request-based system ensures that motor carriers who value access to the content of records under § 371.3 receive it, while minimizing the burden for brokers who, under an automatic disclosure requirement, would need to distribute the content of records to all parties, whether or not they wanted to receive it. The Agency is unable to develop quantitative cost estimate comparisons for this alternative due to lack of data on the number of transactions per broker, how many of these transactions include waiver clauses, and how many parties request access to the content of records under § 371.3.

As previously discussed, FMCSA considered whether to include an explicit ban on waivers, as suggested by SBTC and OOIDA, in the regulation and decided against it.

The proposed timeframe of 48 hours to provide requested records would benefit motor carriers by ensuring timely access to information and would produce cost savings for brokers by reducing the frequency at which brokers would need to respond to or consider repeated inquiries under § 371.3. A longer timeframe than 48 hours would diminish these cost savings. The Agency views 48 hours as a balanced approach, promoting both industry efficiency and manageable burdens for brokers. The Agency seeks comment on the 48-hour proposed timeframe to provide requested records.

B. Advance Notice of Proposed Rulemaking

Under 49 U.S.C. 31136(g), FMCSA is required to publish an advance notice of proposed rulemaking (ANPRM) or proceed with a negotiated rulemaking if a proposed safety rule “under this part” is likely to lead to the promulgation of a major rule. “This part” is Part B of Subtitle VI of Title 49, United States Code, i.e.,49 U.S.C. chapters 311-317. The statutory authority for this rule, however, is derived from the Agency's commercial authorities in Part B of Subtitle IV of Title 49, United States Code, i.e.,49 U.S.C. chapters 131-149. Therefore, the Agency is not required to publish an ANPRM or proceed with a negotiated rulemaking.

C. Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601 et seq. ), as amended by the Small Business Regulatory Enforcement Fairness Act of 1996,^[26] requires Federal agencies to consider the effects of the regulatory action on small business and other small entities and to minimize any significant economic impact. The term small entities comprises small businesses and not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000 (5 U.S.C. 601(6)). Accordingly, DOT policy requires an analysis of the impact of all regulations on small entities, and mandates that agencies strive to lessen any adverse effects on these businesses.

Affected Small Entities

This rule has the potential to impact shippers, brokers, and motor carriers. The Small Business Administration's (SBA) size standard for a small entity (13 CFR 121.201) differs by industry code. The entities affected by this rule fall into many different industry codes. In order to determine the number of affected small entities, FMCSA examined the 2012 and 2017 Economic Census data for two different North American Industry Classification System (NAICS) subsectors: Truck Transportation (subsector 484) and Transit and Ground Transportation (subsector 485).

As shown in Table 3 below, the SBA size standards for subsectors 484 and 485 range from $19.0 million to $43.0 million in revenue per year. To determine the percentage of firms that have revenue at or below SBA's thresholds within each of the NAICS national industries, FMCSA examined data from the 2017 Economic Census.^[27] The Census Bureau will suppress (omit) data in Economic Census tables if the data, were it to be known, would allow one contributor's value to be too closely estimated. This can occur when there are very few contributors, or when there are one or two large contributors that dominate the aggregate statistic.^[28] In instances where 2017 data were suppressed, the Agency imputed 2017 levels using data from the 2012 Economic Census.^[29] Boundaries for the revenue categories used in the Economic Census do not exactly coincide with the SBA thresholds. Instead, the SBA threshold generally falls between two different revenue categories. However, FMCSA was able ( print page 91668) to estimate the percentage of small entities within each NAICS code.

The percentages of entities with annual revenue less than the SBA's threshold, and therefore considered small, ranged from 93.1 percent to 99.5 percent. Specifically, approximately 93.1 percent of the firms in the category representing brokers, Freight Transportation Arrangement (national industry 488510), had annual revenue less than the SBA's revenue threshold of $20.0 million and would be considered small entities.^[30] FMCSA estimates 99.5 percent of firms in the General Freight Trucking, Local (national industry 484110) had annual revenue less than the corresponding SBA's revenue threshold of $34.0 million and would be considered small entities.

The Agency believes that the burden to small brokers would be de minimis. The proposed rule would not impose any burdens on small motor carriers. Small brokers would be required to maintain transparency records electronically, include the date of payment for each service performed in connection with each shipment, and would be permitted to include confidentiality clauses in their contracts. The Agency believes that most, if not all, small brokers are currently maintaining records of their transactions in an electronic format. For brokers who are not maintaining their records electronically, the Agency estimates that these records can be made available electronically at a per transaction cost of $2.75, based on the assumption that it would take an office clerk approximately 5 minutes to create an electronic record of each transaction. The Agency also believes that small brokers likely already retain payment dates for brokered services as part of their standard transaction and accounting processes. The Agency finds that including date of payments with records requested under § 371.3 would constitute a minimal burden. Small brokers could incur some loss in revenues through transfers if the proposed regulation is effective in increasing transparency between brokers, shippers, and carriers. However, the Agency is unable to quantify the frequency and magnitude of possible transfers but believes it would be small based on the following factors:

1. Pricing for brokered contracts is nuanced, and the economic conditions affecting any given brokered contract are unlikely to be identical to those affecting any future brokered contracts. This limits and may possibly negate the effectiveness of using broker information to negotiate for better rates on future contracts;

2. The willingness of motor carriers to accept brokered freight contracts are based on several factors, such that increased transparency may have minimal to no impact on carrier preferences. These factors include costs of fulfilling the contractual obligations, market rate information, existing economic conditions, the type of commodity, and the time of year; and

3. Brokers may find that they can retain current margins due to the relatively strong demand for brokered freight contracts.

Table 3 below shows the complete estimates of the number of small entities within the industries that may be affected by this rule.

Table 3—Estimates of Number of Small Entities

NAICS code	Description	SBA size standard (millions)	Total number of firms	Number of small entities	Percent of all firms
484110	General Freight Trucking, Local	$34.0	22,066	21,950	99.5
484121	General Freight Trucking, Long Distance, Truckload	34.0	23,557	23,045	97.8
484122	General Freight Trucking, Long Distance, Less Than Truckload	43.0	3,138	3,050	97.2
484210	Used Household and Office Goods Moving	34.0	6,097	6,041	99.1
484220	Specialized Freight (except Used Goods) Trucking, Local	34.0	22,797	22,631	99.3
484230	Specialized Freight (except Used Goods) Trucking, Long Distance	34.0	7,310	7,042	96.3
488510	Freight Transportation Arrangement	20.0	13,252	12,332	93.1