[Federal Register Volume 59, Number 62 (Thursday, March 31, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-7643]


[[Page Unknown]]

[Federal Register: March 31, 1994]


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INTERSTATE COMMERCE COMMISSION
[Finance Docket No. 32477]

 

Kokomo Grain Co., Inc.--Acquisition Exemption--Rail Line of 
Kokomo Rail Co., Inc.

    Kokomo Grain Co., Inc. (KGI), a noncarrier, has filed a notice of 
exemption to acquire from Kokomo Rail Co., Inc. (KRI), a 12.59-mile 
railroad line, extending from milepost 134.48 at Marion to milepost 
147.07 at Amboy, in Grant and Miami Counties, IN. The line is being 
operated by Central Railroad Company of Indianapolis under an agreement 
that will be assigned by KRI to KGI.
    The parties expected to consummate the proposed transaction on or 
after March 18, 1994.\1\
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    \1\KGI is a shipper on the line. It does not seek, and this 
notice does not constitute, an exemption from 49 U.S.C. 10746, the 
so-called commodities clause. Section 10746 provides, ``a rail 
carrier providing transportation * * * may not transport * * * [a] 
commodity that * * * is owned by the carrier or in which it has an 
interest.'' The commodities clause does not preclude railroad 
ownership by a shipper. See United States v. Lehigh Valley R. Co., 
220 U.S. 257 (1911). Rather, it was intended to prevent possible 
discrimination if rail carriers manufacture or deal in products that 
they also transport for others. Thus, a violation of section 10746 
can occur only if the rail line will be operated as the alter ego of 
the shipper and other shippers will be prejudiced. See United States 
v. South Buffalo Ry. Co., 333 U.S. 771 (1948); and Border Pacific 
Railroad, Inc.--Exemption From 49 U.S.C. 10901, 10746, and 11301, 
Finance Docket No. 30347 (ICC served Jan. 16, 1984).
    Because there are no competing shippers on the line and KGI has 
contracted out its operation, it is unlikely that others will be 
prejudiced by the acquisition. Under similar circumstances, the 
Commission has routinely dismissed petitions for exemption from 
section 10746. See, e.g., Southern Electric Generating Company--
Petition for Exemption from Regulation under 49 U.S.C. 10746, 
Finance Docket No. 31498 (ICC served Sept. 19, 1989); and Blackstone 
Capital Partners L.P., Blackstone Transportation Partners L.P. and 
USX Corporation--Exemption From 49 U.S.C. 10746, 11321, and 11343, 
Finance Docket No. 31363 (ICC served Dec. 23, 1988) (slip op. at 3-
4).
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    Any comments must be filed with the Commission and served on: 
Thomas F. McFarland, Jr. of Belnap, Spencer, McFarland & Herman; 20 
North Wacker Drive, suite 3118; Chicago, IL 60606-3101.
    This notice is filed under 49 CFR 1150.31. If the notice contains 
false or misleading information, the exemption is void ab initio. 
Petitions to revoke the exemption under 49 U.S.C. 10505(d) may be filed 
at any time. The filing of a petition to revoke will not automatically 
stay the transaction.

    Decided: March 24, 1994.

    By the Commission, David M. Konschnik, Director, Office of 
Proceedings.
Sidney L. Strickland, Jr.,
Secretary.
[FR Doc. 94-7643 Filed 3-30-94; 8:45 am]
BILLING CODE 7035-01-P