In part to make exports easier for the exporting firm, in part in response to the once

unreliable Mexican telephone system, and in part to manage the assorted trade and transportation

barriers, a system of intermediaries has developed along the U.S.-Mexican border, commonly

referred to as 'brokers.' The scope of their activities can vary widely. Virtually all such firms

maintain refrigerated warehouse facilities and handle the transfer from Mexican to U.S. transport

equipment. The majority act strictly as brokers, not taking title to the product, while others also

are wholesalers, purchasing and reselling the product. It is most common for 'brokers' to accept

product at their facilities on the U.S. side and have no involvement, other than telephone

communications and occasional visits to assess product availabilities and qualities, with the

Mexican exporters. However, some will send representatives, known as coyotes, into Mexico

to forward contract product. They may even provide financial and technical support during the

planting season and assume responsibility for haulage to the border. Even the largest exporters

have a 'broker' on the border. However, with many of these, the brokerage firm is owned by

the exporter and often the firm is run by a member of the family.

 For an exporter whose English is not strong or who is unfamiliar with U.S. business

practices and the characteristics of the U.S. market, these 'brokers' at the border serve an

essential service. They allow access to the U.S. market to a firm that would otherwise not have

it. Unfortunately the informational advantages which give 'brokers' their value in the market,

also create the potential for abuses. For example, the Mexican exporter rarely, if ever, receives

direct confirmation regarding the price actually paid by the final receiver for product consigned

to a 'broker' and normally knows little or nothing about the receiver. As such, an unscrupulous

'broker' could: (a) claim consigned product was sold for a lower price than actually occurred;