How to Become a Truck Dispatcher

FMCSA published this explanation on June 16, 2023, in the Federal Register as Definitions of Broker and Bona Fide Agents (88 FR 39368). The agency's own summary is on the FMCSA newsroom page.

What FMCSA calls a dispatch service

FMCSA says there is no statutory or regulatory definition of a dispatch service, and no commonly accepted definition either. Features it describes are: working for motor carriers rather than shippers, sourcing loads for those carriers, and doing other work for carriers that is not sourcing shipments.

FMCSA also says it has no statutory authority to regulate a dispatch service unless that service meets the criteria for registration as a broker, a freight forwarder, or a motor carrier. Congress did not create a separate dispatch license in the Infrastructure Investment and Jobs Act provision that ordered this guidance.

When broker authority is not required

FMCSA's list is not exclusive, and a dispatch service does not have to meet every item. These are the factors the guidance says generally describe a bona fide agent that does not need broker authority:

1. A written legal contract in which the motor carrier appoints the dispatch service as its agent. FMCSA says this is often a long-term relationship, and the contract should specify insurance and liability responsibilities. See the dispatcher-carrier contract template.
2. The dispatch service complies with state licensing requirements, if any apply.
3. The dispatch service arranges the carrier's shipments through a broker and does not seek or solicit shippers for freight.
4. The dispatch service is paid by the motor carrier under the written agreement. It does not bill or take compensation from the broker, a third-party logistics company, or a factoring company.
5. The dispatch service is not an intermediary in the money between a broker and a motor carrier.
6. The dispatch service is an IRS Form 1099 recipient from the motor carrier, or a W-2 employee of the motor carrier, as the contract says.
7. The dispatch service says it is a dispatch service working under an agreement with a specific motor carrier, and the shipment is arranged for that carrier only.
8. The dispatch service does not later assign the load to another motor carrier.
9. The dispatch service does not perform the service unless that motor carrier appointed it as agent.

TODO: FMCSA says to follow state licensing requirements if they apply. This guide does not list those licenses. Check the state where you operate.

When broker authority is required

FMCSA says this list is not exclusive either. These factors indicate the dispatch service should obtain broker authority:

1. It interacts or negotiates a shipment directly with the shipper, or with the shipper's representative.
2. It takes compensation for a load from the broker or a factoring company, or it is part of that monetary transaction.
3. It arranges a shipment and has no written legal contract with the motor carrier that meets the appointment factor above.
4. It accepts a shipment without a truck or carrier, then looks for a truck or carrier to move it.
5. It allocates traffic by accepting a shipment that more than one of its contracted carriers could haul, then assigns that shipment to one of them.
6. It is a named party on the shipping contract.
7. It solicits the open market of carriers to transport a shipment.

Representing more than one carrier is not automatically brokerage. FMCSA says "allocating traffic" means any exercise of discretion about which motor carrier gets the load. Its examples of representation without that discretion are carriers limited to different origin states, and carriers that do not haul the same kind of freight (for example, hazardous materials versus other freight, or refrigerated versus flatbed).

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Put the appointment in writing

The first factor FMCSA lists for operating without broker authority is the written appointment. The contract template follows those factors and nothing else. It is not a complete business-startup checklist. FMCSA's notice does not tell you how to form a company, get an EIN, or open a bank account.

Before you offer to dispatch a truck, look the carrier up. The FMCSA carrier lookup and the guide to finding carriers cover the free Company Snapshot.

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