The ICC used a test to determine if a trucking operation is bona fide private transportation. The private trucking operation must be incidental to and in the furtherance of the firm’s primary business. The term “logistics” comes from the Greek word logistics, meaning skilled in calculating. It describes the science of planning and carrying out the movement and storage of goods including services and information from point of origin to point of consumption. A company that provides logistics services is called a third-party logistics provider (3PL).
A Primary-Business Test includes the following:
- Determining the business of the company.
- Identifying what mode or modes of transportation are used to further the company’s primary business.
- Documenting how transportation is integrated with other parts of the business.
- Analyzing whether the private carriage is being provided as a means to an end, rather than an end in itself.
In general, the primary business test is used to assess whether a company is in the business of transportation or if transportation is merely incidental to the company’s primary business. The test is important because it can help a company figure out if they need to be regulated as a common carrier or if it can be exempt from regulation.