{"operation":"document","citation":"09-0064","title":"C & N Companies — Hazardous Materials Safety Interpretation","source_type":"guidance","agency":"Pipeline and Hazardous Materials Safety Administration","status":"guidance","official":true,"published_on":"2009-10-08","effective_on":null,"summary":"09-0064 response to C & N Companies concerning 171.1, 172.204, 173.31.","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-interpretation-09-0064.json","markdown":"https://regulus.evalyn.ai/document/phmsa-interpretation-09-0064.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-interpretation-09-0064","source_url":"https://www.phmsa.dot.gov/sites/phmsa.dot.gov/files/legacy/interpretations/Interpretations/2009/090064.pdf","body":"<<<PAGE 1>>>\n\nU.S. Department\nof Transportation\nPipeline and Hazardous\nMaterials Safety\nAdministration\n1200 New Jersey Avenue, SE\nWashington, D.C. 20590\nMr. Jon Bjornstad\nPresident\nC & N Companies\n8011 34'h Ave., S Suite 147\nBloomington, MN 55425\nRef. No. 09-0064\nDear Mr. Bjornstad:\nThis is in response to your request for clarification of the Hazardous Materials\nRegulations (HMR; 49 CFR Parts 171-180) regarding an offeror's respoilsibility for\npreparing hazardous materials for transportation.\nAccording to your letter, your company contracts with ethanol manufacturers to\nmanage the sale of the ethanol for the manufacturer. The contracts specify that the\nmanufacturer will \"supervise the loading and delivery of Ethanol, prepare delivery\ndocumentation and generally be responsible for all matters ancillary to such\nactivities.\" The rail tank cars are loaded by the manufacturer, closed by the\nmanufacturer, and sealed by the manufacturer. The manufacturer provides C&N\nwith information stating the amount of ethanol loaded into the tank car and provides a\nloading checklist signed by the loader, indicating that the car has been inspected and\nconforms to 5 173.31(d)(l) of the HMR. Your questions are paraphrased and\nanswered below.\n01. Is C&N Companies (C&N) considered the agent of the manufacturer (or previous\nofferor) under 5 172.204(d)(l) and if so, may C&N list the manufacturer as the\nshipper and sign the shipper's certification?\nAl. For purposes of the HMR, an \"offeror\" is any person wlio perforills or is\nresponsible for performing a pre-transportation function required under the HMR for\ntransportation of a hazardous material in commerce or who tenders or makes the\nhazardous material available to a carrier for transportation in commerce (see 5 171.8).\nThere may be more than one offeror for a shipment of hazardous materials. Under tlie\nscenario described in your letter, C&N and the ethanol manufacturer are both offerors\nof the ethanol shipment and are responsible for the specific pre-transportation\nfunctions each performs (see 5 17 1.1 (b) for the definition of \"pre-transportation\nfunction\"). C&N, acting as the agent of the manufacturer, is considered an offeror and\nmay sign the certification statement or] the shipping paper. In so doing, C&N takes\n\n<<<PAGE 2>>>\n\nresponsibility for performing that function. In order to properly certify a shipment, the\nperson signing the certification must have direct knowledge that the materials are in\nproper condition for transportation and are properly classified, described, packaged,\nmarked and labeled in accordance with the HMR and applicable international\nregulations.\nQ2. May C&N rely on information provided by the manufacturer (or previous\nofferor) and in good faith rely on that information when signing the certification\nstatement and does \"direct knowledge\" include information passed on from the\nmanufacturer?\nA2. Yes. An offeror may rely on information provided by another offeror and\nconsider it direct knowledge, unless that offeror knows or a reasonable person acting\nin the circumstances and exercising reasonable care would know, that the information\nprovided is incorrect.\nQ3. Is this a situation whereby each offeror is responsible for only those functions\nperformed?\nA3. Yes. Each offeror is responsible only for the specific pre-transportation or\ntransportation functions that it performs or is required to perform. Also see A1 and\nA2.\nQ4. How would regulatory compliance be determined when a tank car is in violation\nof § 173.31(d)(l)(iv) with respect to ensuring that all closures and fastenings are\nproperly tightened?\nA4. The determination of compliance is based on various factors, such as signs of\nleakage around the closures of fastenings or individually testing the closures and\nfasteners. The determination would also consider applicable instructions from the\nmanufacturer and may also include information obtained from the hazardous materials\nemployee(s) who actually tightened the closures and fastenings. Generally, such\ndeterminations are made on a case-by-case basis and are dependent on the facts of the\nspecific situation.\nI hope this information is helpful. Please contact this office should you have\nadditional questions.\nHattie L. Mitchell\nChief, Regulatory Review and Reinvention\nOffice of Hazardous Materials Standards\n\n<<<PAGE 3>>>\n\n8011 34th Ave. S Suite 147\nBloomington, MN 55425\nMarch 4,2009\nMr. Edward T. Mauullo\nDtrector, Office of Hazardous Materials Standards\nU.S. DOT/PHMSA (PHH- t 0)\n1200 New Jersey Avenue. SE East Building, 2nd Floor\nWashington, DC 20590\nDear Mr. Mauullo,\nThis request for formal interpretation is being sent at the suggest~on of an inspector for your off~ce.\nthis request IS w~thout prejudice to the pos~tton of C&N Compan~es In pending violatton\npraceed~ngs\nC&N Ethanol Marketing Corp, IS a marketer of Ethanol, and our company engages with\nmanufacturers, through Ethanol Purchase and Marketing Agreements, to act as the selling agent\nfor ethanol produced by these certain manufacturers.\nThe relation between the two partles 1s created by express contract In th~s corllraol, the\nmanufacturer delegates the transactton of ~ts sales to C&N, gung C&N more or less discretionary\npower to undertake and manage all sales of ethanol. C&N then renders to the manufacturer an\naccount of such sales, along wrth net sales proceeds less commission\nThese contracts stipulate the manufacturer's responsibrltties as far as loading railroad tank car$ of\nethanol The contract reads \"Manufacturer shall supervise the loadrng and dellvery of Ethanol,\nprepare delrvery documentation, and generally be respons~ble for all matters anc~tfary to such\nacttvitres \"\nIn day to day performance of the contract, the rail tank cars are loaded by the manufacturer.\nclosed by the manufacturer and sealed by the maqufacturer The manufacturer provtdes C&N\nwith information stating the amount of gallons w~thln the car. The manufacturer also provlctes a\nloading checktlst slgned by the loader, indrcatrng that the car has been inspected and conforms to\n49CFR 173.31 (d)(1).\nC&N then provides rail carriers with bills of lading, naming the Manufacturer as Shipper, and C&N\nas the Or~g~n Party.\nCBtN IS requesting the foilowlng interpretations:\n(1) Under 49 CFR 172.204 (d)(l), IS C&N consrdered the agent of the manufacturer? If so, can\nC&N list the manufacturer as the shipper of the tank car, and slgn the sh~ppers' cert~ficatron\nwrth the name of a C&N employee? Also, does the documentatlon that C&N recelves from 11s\nmanufacturer as to conformance wlth 49 CFR 173.31(d)(I) constitute \"d~rect knowledge' as\nrequ~red under PHMSA interpretation #598+0135?\n(21 W~th observar'tce of PHMSA Interpretailon 4/04-0183, and urider the guidance PHMSA-04.\n19173 (HM-223A) as publrshed in the Federal Register of July 28, 2005 (Volume 70, Nunher\nRenewabIe energy for the htu~e. @\n\n<<<PAGE 4>>>\n\n- 2 - March 19,2009\n144, Pages 43638-43644) we wish to ask an additional question. If a tank car is found to be\nnot complying with 49 CFR 173.31 (d)(l)(iv), (closure eyebolts loose) how would regulatory\nliability be determined?\nSpecifically,\n(A) Is this a situation where there is more than one offeror of a hazardous material, and where\neach offeror is responsible only for the specific pre-transportation functions that it performs or is\nrequired to perform?\n(6) If so, then, is C&N relying on the information provided by the previous offeror, (the\nmanufacturer), and can C&N use such information in good faith, and in good faith sign the\nShippers Certification with the signature of C&N?\nC&N is responsible for the proper preparation of the Hazardous Bill of Lading, and therefore has\ninterest in properly handling its duties as required under 49 CFR Part 172 Subpart 3 (shipping\npapers). If you require any of the cited documents for a complete review of our situation, please\nlet us know.\nSincerely, , n\nPresident\nC&N Companies\nOffice (952) 854 6675 ext 100\nCell (61 2) 308 3584","truncated":false,"body_characters":7978}