Common Carrier

What is a common carrier?

A common carrier is an individual or company available for public hire to transport people or products from one place to another.

Common carriers include railroads, garbage trucks, and buses. While common carrier primarily refers to transportation services, the term can also describe telecommunication providers and utility companies.

Common carriers use transportation management systems to optimize their logistics operations in the complex supply chain. This management software offers fleet tracking features and monitors shipping and delivery status. 

Types of common carriers

Under United States law, common carriers can operate across air, land, and water. Some types of common carriers include:

1. Air: Various aircraft, including passenger planes, cargo planes, and helicopters, fall under the category of common carriers if their usage meets specific criteria. For example, sightseeing flights or helicopters that move equipment from one location to another both classify as common carriers. 
2. Land: Trucking companies, taxi services, waste removal companies, and railroads qualify as common carriers. They exist to transport passengers and cargo across the terrain.
3. Water: Several common carriers move people and cargo via waterways like barges, ships, and steamboats. Ocean common carriers, also known as vessel-operating common carriers (VOCCs), are shipping lines operating their own vessels. Non-vessel operating common carriers (NVOCCs), typically freight forwarders, don’t have their own ships. Instead, they buy space on other ships and sell it.

In addition to these three main usages, the term common carrier also applies to telecommunication companies and some utility providers. They meet the definition because they “transport” public services from one place to another for a fee. 

Basic elements of common carriers

While different kinds of common carriers exist, they must all meet four criteria, which include: 

• Offering services publicly. Common carriers have to provide services to the general public through advertising or the use of an agent or salesperson. 
• Transporting people or goods. Common carriers must accept transport for any passenger or cargo. However, they can make refusals in certain circumstances, like if the vehicle is already full, the customer refuses to pay, or the goods are hazardous.
• Providing carriage from place to place. A vehicle isn’t a common carrier if it remains stationary. By definition, a common carrier must travel from point A to point B.
• Charging a fee. A common carrier requires compensation to provide services to customers. Typically, the customer pays before the vehicle provides transportation; otherwise, the common carrier can refuse service.

Common carrier regulations

In the US, states have the authority to regulate common carriers within their borders, while the federal government regulates them across state lines. However, some common carriers must also answer to other regulatory bodies. For example, commercial planes must follow FAA regulations. 

Typically, the law holds common carriers to a high standard of care, which means the courts may find them liable if accidents occur. 

Common carrier vs. contract carrier

Common carriers and contract carriers are two different, but sometimes overlapping, transportation providers. 

A common carrier offers transport of people, livestock, or goods from one place to another for compensation. It provides services to the general public.

Meanwhile, a contract carrier also transports people and products for a fee, but they don’t offer their services publicly. They can choose to work with one specific customer and maintain a contract with that client. For example, a manufacturing company with its own semi-trucks might agree to carry goods for another company. 

A company or individual can serve as both a common carrier and a contract carrier. For example, a shipping company can offer its services to the public, but it might also sign exclusive contracts with specific retailers.