Motor Vehicle Leasing

PURPOSE: This proposed rule prescribes requirements to properly identify leased motor vehicles and drivers when they operate under authority issued by the commission, to ensure that leased vehicles operated by motor carriers are safely equipped, maintained, and operated, and properly insured and licensed, and to prevent the evasion of motor carrier regulatory requirements through regulating the leasing of motor vehicles under certain circumstances. (1) Definitions. (A) “Lessee” means the person who received possession and control of the vehicle. (B) “Lessor” means the vehicle’s titled owner or lessee who subleases to another lessee. (2) Motor carriers shall not transport passengers or property in intrastate commerce in non-owned motor vehicles unless there is in place an executed lease for each motor vehicle operated by the motor carrier in intrastate commerce which conforms to the following requirements: (A) The lease must be reduced to writing and executed with one (1) copy retained by the lessee for not less than two (2) years after the expiration of the lease; and one (1) copy shall accompany the driver while the leased vehicle is in operation and available for inspection by any official authorized to enforce the motor vehicle or transportation laws of this state; (B) The terms of the lease shall identify the lessor and lessee; describe the leased vehicle including the year, make, model, vehicle identification number, license plate number, and licensing state; specify the beginning and ending duration of the lease; specify the payment terms; and provide all the surrounding facts that the leased equipment is exclusively committed to the lessee’s use during the term of the lease; and (C) Except when a vehicle is subleased by a motor carrier in compliance with section (5) of this rule, the lessee shall control all transportation of passengers or property performed in the leased vehicle during the term of the lease and be deemed the sole operator of the motor vehicle unless otherwise agreed upon by the lessee; be responsible for the operation of the vehicle, including its equipment, physical condition, insurance coverage, licensing, markings, drivers, drivers’ qualifications, drivers’ hours of service, and all other related matters in conformity with the applicable laws of this state and the rules of the commission, to the same extent as if the lessee were the actual owner of the vehicle; immediately upon the termination of the lease or sublease of the vehicle, remove or obliterate all the lessee’s markings from the vehicle; and immediately remove the cancelled lease from the vehicle if the lease is cancelled prior to the expiration date. (3) If the lessee motor carrier knowingly or recklessly fails to control the transportation performed in the leased vehicle, then the transportation is not covered and authorized by the lessee’s operating authority and the lessee motor carrier shall be deemed to be procuring, aiding, and abetting any transportation performed in the leased vehicle during the term of the lease. (4) Motor carriers shall not lease vehicles with or without drivers to shippers or receivers of property or to passengers or chartering groups. (5) Motor carriers shall not sublease a leased vehicle, with or without driver, unless the lease expressly authorizes the lessee motor carrier to sublease the vehicle to another authorized motor carrier during the lease. The sublease shall not authorize further subleasing of the vehicle to any person. A copy of the sublease and the original lease shall accompany the driver at all times while the vehicle is in operation, and be available for inspection. (6) Authorized household goods motor carriers may transport household goods in motor vehicles owned or leased by the carrier’s agent under an agency agreement in compliance with 7 CSR 265-10.050 and the Household Goods Tariff Circular No. 1-2013. (7) This rule does not authorize the leasing of any certificate, permit, or operating authority unless the leasing is approved by order of the commission as a transfer of authority under section 390.111, RSMo. (8) Whenever a person who is not authorized by the commission to engage in intrastate transportation leases its own equipment— (A) With or without driver, to an authorized intrastate motor carrier and the lease or any motor vehicle operations during the term of the lease do not actually comply with all the requirements of this rule, then those operations are not covered and not authorized by the lessee’s operating authority; or (B) With driver to a shipper, receiver, passenger, or chartering group, the lessor’s intrastate transportation under that lease shall be presumed to result in private carriage by the lessee if the lease and all operations under it, comply with section (2) of this rule and the term of the lease is not less than thirty (30) consecutive days. If a lease or other arrangement between a shipper, receiver, passenger, or chartering group and the owner of a motor vehicle who is not authorized by the commission to engage in intrastate transportation does not comply with these requirements, then the lessor’s motor vehicle operations shall not be presumed to be private carriage by the lessee. AUTHORITY: section 622.027, RSMo 2000.* This rule originally filed as 4 CSR 265-10.040. Emergency rule filed June 14, 1985, effective July 1, 1985, expired Oct. 28, 1985. Original rule filed Aug. 1, 1985, effective Oct. 29, 1985. Amended: Filed May 17, 1989, effective Sept. 11, 1989. Amended: Filed Nov. 4, 1992, effective July 8, 1993. Emergency amendment filed Dec. 1, 1994, terminated Dec. 19, 1994. Emergency amendment filed Dec. 20, 1994, effective Jan. 1, 1995, expired April 30, 1995. Emergency amendment filed April TRANSPORTATION 20, 1995, effective May 1, 1995, expired Aug. 28, 1995. Emergency amendment filed Aug. 18, 1995, effective Aug. 29, 1995, expired Feb. 24, 1996. Amended: Filed Aug. 3, 1995, effective Feb. 25, 1996. Emergency amendment filed Aug. 19, 1996, effective Aug. 29, 1996, expired Feb. 24, 1997. Moved to 7 CSR 265-10.040, effective July 11, 2002. Rescinded and readopted: Filed May 2, 2013, effective Dec. 30, 2013. *Original authority: 622.027, RSMo 1985, amended 1993, 1995.