Pending Regulation for the Mexican Freight Intermediaries
The role of the cargo agent in the transportation and logistics industry is fundamental. This makes it incredibly difficult to understand why in this XXI century their activities have not been legally recognized, constituted or regulated by the Mexican government.
The fact that the cargo agent is not regulated generates losses and uncertainty for the users, transportation companies and the cargo agents themselves.
The users: In general, companies who hire cargo agent services do not have legal guarantees to hold these agents accountable for lack of service, damage or lost merchandise.
Transportation companies: When the carrier has been hired by the cargo agent, the carrier does not posses the legal guarantees.
Due to the lack of regulation or law, the cargo agent obligations are not clear to their clients, consignees, shippers, carriers or transport companies.
As an example, and one that is advisable to be followed, is the existing US regulation with regard to cargo agents. Freight brokers must register with the Department of Transportation (DOT), post a bond in the amount of $75,000 dollars to guarantee payment to carriers in case of non-fulfillment of services. This requirement alone generates certainty and trust among carriers, and as a result, it eases the approval process for the cargo agent by the carrier, and approved credit limits might be higher.
Freight Intermediaries: In general, a cargo agent does not have rights or obligations previously defined since they are not included in the transportation contract. A Mexican cargo agent cannot generate a Carta Porte (mexican bill of lading) as many cargo agents in other countries do. This is the reason cargo agents do not have the legal supporting documentation on hand when trying to collect their invoices in a more efficient manner or when the need arises to defend themselves against claims for damage or lost merchandise. They do not possess the legal frame to clearly free them from cases in which consignees, shippers or carriers are to blame.
Mexican cargo agents as a group have been able to make strides in their industry. Some of them have included the “Standard Trading Conditions” which provide certainty when allowing a process of approval for cargo agents. However, it is necessary to provide support to this group by establishing rights and obligations defined by law as other countries do without regard to the fact that they are printed or not in their shipping documents.
I would suggest you check to make sure your cargo agent is registered with AMACARGA (Mexican Freight Intermediaries Association), and when you need to hire an agent, you hire one who is registered. The cargo agent must comply with some requirements to join AMACARGA and attain honorable operational status.
I hope the new government supports this group and they legally recognize, constitute and regulate them. When they do, without a doubt, they will be generating certainty for the cargo agent as well as the logistics community in general, exporters and importers.
What are your thoughts on this subject?