Swedish Transport Agency suspects hauliers are using subsidiaries to pay lower fines
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Hauliers that don't follow drivers’ hours regulations often have lower turnover than their competitors, the Swedish Transport Agency has recently found. Sometimes, these businesses are letterbox companies that can easily be shut down and restarted. The government department fears the formation of some of these firms could be motivated by the fact that fines for multiple transport violations in Sweden are connected to turnover.
Gunilla Yourstone, the Department Manager for Drivers’ Hours regulations at the Swedish Transport Agency, explained the seemingly controversial discovery in article published by Swedish Road Transport website Trailer.se.
According to the expert, the agency has noticed that companies with extensive offence history often have low turnover and that they are sometimes so-called letterbox companies.
“We have seen that the companies are often newly established. Sometimes we then find owners linked to companies with whom we have dealt before due to many violations. Sometimes it is even the same vehicle that has been taken over,” she told Trailer.se.
Yourstone added that the agency is thus keeping an eye not only on the vehicles of such problematic companies but also on their ownership structure.
“In addition to penalty fees, it may also be relevant to supervise permits to curb cheating”, the article adds.
By using subsidiaries, the difference between the level of fines for transport violations can potentially be massive.
For example, earlier this month, a small haulage company in Södertälje was found to have been guilty of violations corresponding to a fine of SEK 301,000 (€28,000). However, as the rules in Sweden see fines calculated on the basis of income, and that the aforementioned fine was roughly half the company’s turnover, the haulier ended up being fined SEK 5,280 (€491).
Of course, in this example, the haulage firm may well have been a genuine small business. Hence, the fine being reduced would make sense. On the other hand, it is clear to see how the rules could theoretically be exploited via widespread the creation of small haulage companies by large road transport corporations.
According to the Trailer.se report, this is a loophole that the Swedish Government are keen to close.