Good reputation in transport and consequences of losing it

What is good reputation in a company and why is it so important?

In the road transport industry, good reputation is much more than just a positive image. In terms of regulations, it means meeting the requirement of having no criminal record for specific intentional crimes and no serious violations of transport regulations.

Meeting the good reputation requirement in road transport is a legal obligation that determines the possibility of conducting carrier activities.

Legal requirement in road transport

Good reputation is one of the fundamental requirements for every entrepreneur performing the profession of road carrier. It has been detailed in Regulation (EC) No. 1071/2009 of the European Parliament and of the Council, which establishes common rules concerning the conditions for performing the carrier profession. According to Art. 3(1)(b) of this regulation, good reputation, alongside having an actual headquarters and appropriate financial capacity, is a key condition for conducting transport activities.

The essence of this requirement is the necessity of having good reputation of the company both when applying for permission to perform the profession of road carrier, and throughout the entire period of conducting activities. In practice, this means having no criminal record for specific intentional crimes and no serious sanctions imposed on the entrepreneur for violations of transport regulations.

Importance of company good reputation for business activities

For transport companies, good reputation goes beyond the image dimension - its loss leads to immediate suspension of permission to perform the profession of road carrier. Such a situation means halting the possibility of providing transport services until a rehabilitation measure is applied, which can seriously threaten the existence of the company.

Who is subject to good reputation assessment in road transport?

It’s worth emphasizing that not only the companies themselves are subject to good reputation assessment, but also specific people associated with them. As a result of the amendment to the Road Transport Act, adapting national regulations to the provisions of the Mobility Package, the circle of these people has significantly expanded. Currently, the following are subject to good reputation assessment:

• Entrepreneurs conducting transport activities;
• Transport managers or natural persons performing transport manager tasks on behalf of a micro-entrepreneur;
• Members of the management body of a legal entity;
• Persons managing a general partnership, limited partnership, or limited joint-stock partnership.

It should be noted that the good reputation assessment procedure may be initiated not only in connection with violations committed in Poland, but also in other European Union member states, which further increases the risk for entrepreneurs operating in the international market.

Types of violations leading to reputation loss

The European Commission has introduced a detailed classification of violations that may lead to the loss of company good reputation. This system precisely organizes offenses according to their gravity and resulting legal consequences, and it distinguishes:

• Most serious violations (MSV);
• Very serious violations (VSV);
• Serious violations (SV).

Most serious violations (MSV)

Most serious violations (MSV) pose the greatest threat to the functioning of a transport company. Even a single such violation can trigger the good reputation procedure.

The category of most serious violations includes:

• Performing road transport without the required Community license;
• Using someone else’s driver card or using a forged card;
• Performing transport with a vehicle that doesn’t have a valid technical inspection;
• Connecting an unauthorized device to the tachograph (so-called magnet);
• Exceeding the permissible total weight of the vehicle by at least 25%.

It’s worth emphasizing that the gravity of the violation is not determined by the amount of the financial penalty, but by its formal qualification. A carrier can lose good reputation even for a violation threatened with a penalty of just 500 PLN, if it has been classified as most serious (MSV).

Very serious violations (VSV)

Next in order are the so-called very serious violations (VSV). They constitute the second category of offenses that can also contribute to the loss of good reputation. Example violations from this group include:

• Lack of country symbol for starting/ending work in the tachograph;
• Outdated periodic training for drivers;
• Lack of employee posting notification.

Serious violations (SV)

Serious violations (SV) include less critical but still significant offenses, such as driving a vehicle from 30 to 90 minutes too long without a mandatory break or incorrect use of ferry/train markings in driver working time documentation.

How does the good reputation assessment procedure look?

The good reputation assessment procedure for a transport carrier is a complex administrative process that has been significantly intensifying in recent years.

Role of GITD and the starost

Which authority is responsible for conducting the procedure? It depends on the type of license held:

• Chief Inspector of Road Transport - for carriers holding a Community license;
• Starost appropriate for the carrier’s headquarters - in the case of domestic transport.

These authorities constantly monitor violations through the company risk assessment system. The higher the risk assessment, the greater the probability of controls, which can mean the loss of good reputation. That’s why it’s so important to continuously monitor your own activities for compliance with regulations.

Possible authority decisions

After conducting a detailed analysis, the authority may issue one of three decisions:

• A decision stating that the transport company’s good reputation has been maintained intact - when the authority considers that its loss would be a disproportionate reaction;
• Statement of loss of good reputation - when the loss constitutes a proportionate reaction for the violations committed;
• Decision discontinuing the proceedings.

What’s particularly important - the mere initiation of proceedings does not mean automatic loss of the carrier’s good reputation. Control authorities have the obligation to thoroughly analyze the circumstances of each case.

Importance of the remedial plan

The remedial plan is a key element in the process of protecting good reputation, and the best time to implement it is the initial stage, right after the detection of a violation, even before formal proceedings are initiated.

Let’s remember that the remedial plan must be proportionate and adequate to the type of violations and lead to a real improvement of the situation. The appropriate authority pays special attention to the possibility of improving the situation in the company, the remedial actions taken, and the implemented procedures preventing the occurrence of violations in the future.

If you’re wondering how to prepare an effective remedial plan, you’ll find practical tips in the further part of the article that will help you secure the good reputation of your transport company.

Consequences of losing good reputation for a company

The case of losing good reputation in the transport industry is definitely more than just an image problem. The consequences can be devastating both legally and economically, even leading to the complete termination of carrier activities.

Suspension or revocation of license

At the moment of issuing a decision causing the loss of good reputation, the appropriate authority immediately suspends the permission to perform the profession of road carrier. This suspension remains in force until a rehabilitation measure is applied, which can last from one year to even 10 years! In practice, this means that a transport company cannot legally provide carrier services - continuing activities in such a case is qualified as performing transport without permission.

It’s worth noting that the loss of good reputation also leads to the initiation of administrative proceedings, which will likely end with the revocation of the transport license.

Limitation of fleet development

Another severe consequence of losing good reputation is the suspension of the possibility to obtain additional extracts from the Community license. In practice, this means that the entrepreneur loses the ability to expand their fleet, because such an extract is needed for each new vehicle. This suspension can last even 6 months, and sometimes longer, which effectively blocks the company’s development in a key area.

In a situation where competitors are systematically developing their fleet, and a carrier with reputation problems is standing still, a loss of market position, customers, and profitability can very quickly occur.

Loss of contractor trust

Beyond formal administrative consequences, the loss of good reputation also causes serious business problems. When contractors learn about a carrier’s reputation problems, doubts often arise about their reliability and trustworthiness.

It should also be emphasized that rebuilding business partners’ trust is a much more difficult and longer process than losing it. That’s why it’s so important to comply with transport regulations and conduct activities ethically, and consequently meet the condition of good reputation. Each violation can lead to consequences disproportionate to the apparent benefits of breaking them.

Good reputation in road transport - Summary

Good reputation in the transport industry is not only a formal legal requirement, but above all the foundation of stable functioning of a carrier company.

The consequences of losing good reputation are extremely severe for the entire company. Suspension of permission to perform the profession of road carrier, revocation of transport license, or inability to expand the fleet are factors that can completely halt the company’s ability to function. In the case of a transport manager, the loss of good reputation can also mean the loss of contractor trust, who often resign from cooperation with a carrier with damaged reputation.

The most effective strategy remains preventing violations. It’s worth investing in appropriate control procedures and regular training for both drivers and management staff. However, if irregularities are detected, immediate development and implementation of a remedial plan can significantly increase the chances of maintaining good reputation.

If you run a transport company and need support in maintaining good reputation or preparing a remedial plan, contact us. Our specialists will help identify potential risks and propose solutions tailored to the specifics of your company.

Good reputation of a transport company - Frequently asked questions

Below we’ve collected questions about good reputation in road transport that we most often receive and provided answers to them. If they lack information you’re looking for, we encourage you to contact us! Our specialists will gladly provide support!

Can you lose good reputation in road transport?

Yes, you can lose good reputation in road transport. This can happen as a result of serious violations of transport regulations, such as performing transport without the required license, falsifying documents, or exceeding the permissible total weight of the vehicle by at least 25%.

What are the consequences of losing good reputation for a transport company?

The consequences of losing good reputation can be very serious. They include suspension or revocation of the transport license, limitation of fleet development possibilities through inability to obtain new license extracts, as well as loss of contractor trust, which can lead to difficulties in obtaining new orders.

Who is subject to good reputation assessment in a transport company?

Not only the companies themselves are subject to good reputation assessment, but also specific people associated with them. These are: the entrepreneur conducting transport activities, the transport manager, members of the management body of a legal entity, and persons managing partnerships.

How to save the good reputation of a transport company?

The most effective strategy is preventing violations through the implementation of appropriate control procedures and systematic training of drivers and managers. In case of detecting irregularities, it’s crucial to immediately develop and implement a remedial plan.

Good reputation in transport - Can it be regained after loss?

Yes, there is a possibility to regain good reputation after its loss, but it’s a difficult and time-consuming process. It requires the application of a rehabilitation measure, which can last from one year to even 10 years. During this time, the company must prove that it has taken effective remedial and preventive actions.