[Federal Register Volume 67, Number 189 (Monday, September 30, 2002)]
[Rules and Regulations]
[Pages 61290-61291]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-24603]



[[Page 61290]]

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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

49 CFR Part 1144

[STB Ex Parte No. 639]


Removal of Joint Rate Cancellation Regulations

AGENCY: Surface Transportation Board, Transportation.

ACTION: Final rule.

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SUMMARY: The Surface Transportation Board (Board) is removing 
regulations concerning the cancellation of through routes and joint 
rates, because those rules have been made obsolete by statutory 
changes.

EFFECTIVE DATE: These rules are effective on September 30, 2002.

FOR FURTHER INFORMATION CONTACT: John Sado, (202) 565-1661. [Federal 
Information Relay Service (FIRS) for the hearing impaired: 1-800-877-
8339.]

SUPPLEMENTARY INFORMATION: The Board is revising its regulations at 49 
CFR 1144 to delete obsolete provisions and reflect other changes made 
by the ICC Termination Act of 1995, Pub. L. 104-88, 109 Stat. 803 
(1995) (ICCTA). The rules at section 1144 were issued by the Interstate 
Commerce Commission (ICC or Commission) in Intramodal Rail Competition, 
1 I.C.C.2d 822 (1985), and pertain to three situations: cancellations 
of through routes and/or joint rates; prescription of a through rate or 
joint route; and prescription of reciprocal switching. The Board 
retains jurisdiction to prescribe through routes and joints rates (49 
U.S.C. 10705), and to prescribe reciprocal switching (49 U.S.C. 11102, 
replacing former 49 U.S.C. 11103).
    The ICCTA, however, eliminated the joint rate and through route 
cancellation provisions of former 49 U.S.C. 10705(e) and 10705a. Former 
section 10705(e) was previously found at former section 15(3) of the 
Interstate Commerce Act and provided that a joint rate cancellation 
could be investigated or suspended by the ICC, and if it was suspended 
and an investigation was instituted, the cancelling carrier had to show 
that the proposed cancellation was in the public interest. Suspension 
was considered under the standards of former 49 U.S.C. 10707. See 49 
CFR 1144.3. The Staggers Rail Act of 1980 added a new section, former 
49 U.S.C. 10705a, which provided a guaranteed cancellation of 
noncompensatory joint rates (below 110 percent of variable costs). 
Joint rates 110 percent or higher were to be considered under the 
public interest standard of former section 10705(e), and if the 
Commission determined that an investigation was warranted, the 
cancellation was to be suspended during the pendency of the 
consideration. See Family Lines Rail System--Unilateral Can. of Joint 
Rates, 365 I.C.C. 464, 466-67 (1981), aff'd, Southern R. Co. v. 
Interstate Commerce Commission, 681 F.2d 29 (D.C. 1982).
    We will eliminate sections 1144.1, 1144.3, and 1144.4 pertaining to 
the notification, suspension, and investigation of proposed joint rate 
cancellations. Not only are these sections obsolete with the 
elimination of the joint rate cancellation provisions of former 49 
U.S.C. 10705(e) and 10705a, but they also contain references to 
obsolete sections 49 U.S.C. 10762(c)(3) (concerning tariff 
notification) and 49 U.S.C. 10707 (concerning rate suspensions). We 
will also remove the reference to through route or joint rate 
cancellations and suspension and investigation in the negotiations 
section, 49 CFR 1144.2.
    The remainder of section 1144.2 and all of section 1144.5, 
concerning prescribing a through rate and establishing a switching 
arrangement, and section 1144.6, general provisions, are still 
applicable. As noted, the Board retains jurisdiction in these areas 
pursuant to 49 U.S.C. 10705 and 11102. Accordingly, we will not make 
any changes to section 1144.2 beyond removing the reference to 
cancellations, supra. We will not make substantive modifications to 
section 1144.5 but will only change obsolete references (section 11103 
will be changed to section 11102 and section 11101a will be changed to 
section 11101.) We will remove a reference in section 1144.6 to our 
rules at 49 CFR 1132, which now pertain only to motor carriers, and the 
obsolete investigation section, 1144.4. Finally, these three remaining 
sections of this part will be renumbered as 49 CFR 1144.1, 1144.2, and 
1144.3.\1\
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    \1\ Consequently, the reference in new section 1144.3(c) will be 
to section 1144.2, instead of current section 1144.6(d)'s reference 
to sections 1144.4 and 1144.5.
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    Because these changes merely remove obsolete regulations based on 
statutory provisions that have been eliminated and revise other 
regulations to provide updated statutory references, we find good cause 
to dispense with notice and comment. See 5 U.S.C. 553(b)(B). Moreover, 
we find good cause for making these rules effective on less than 30 
days' notice under 5 U.S.C. 553(d), so that these changes will be 
effective by October 1, 2002, which is the cut-off date for revisions 
to the next edition of the applicable volume of the Code of Federal 
Regulations.
    Copies of the decision may be purchased from Da-2-Da Legal Copy 
Service by calling 202-293-7776 (assistance for the hearing impaired is 
available through FIRS at 1-800-877-8339) or visiting Suite 405, 1925 K 
Street, NW., Washington, DC 20006.
    This action will not significantly affect either the quality of the 
human environment or the conservation of energy resources.

List of Subjects in 49 CFR Part 1144

    Railroads.
    It is ordered:
    1. The final rules set forth in this decision are adopted. Notice 
of the rules adopted here will be published in the Federal Register.
    2. This decision is effective on September 30, 2002.

    Decided: September 19, 2002.

    By the Board, Chairman Morgan and Vice Chairman Burkes.
Vernon A. Williams,
Secretary.

    For the reasons set forth in the preamble, part 1144, of title 49, 
chapter X, of the Code of Federal Regulations is revised to read as 
follows:

PART 1144--INTRAMODAL RAIL COMPETITION

Sec.
1144.1 Negotiation.
1144.2 Prescription.
1144.3 General.

    Authority: 49 U.S.C. 721, 10703, 10705, and 11102.


Sec.  1144.1  Negotiation.

    (a) Timing. At least 5 days prior to seeking the prescription of a 
through route, joint rate, or reciprocal switching, the party intending 
to initiate such action must first seek to engage in negotiations to 
resolve its dispute with the prospective defendants.
    (b) Participation. Participation or failure to participate in 
negotiations does not waive a party's right to file a timely request 
for prescription.
    (c) Arbitration. The parties may use arbitration as part of the 
negotiation process, or in lieu of litigation before the Board.


Sec.  1144.2  Prescription.

    (a) General. A through route or a through rate shall be prescribed 
under 49 U.S.C. 10705, or a switching arrangement shall be established 
under 49 U.S.C. 11102, if the Board determines:
    (1) That the prescription or establishment is necessary to remedy 
or

[[Page 61291]]

prevent an act that is contrary to the competition policies of 49 
U.S.C. 10101 or is otherwise anticompetitive, and otherwise satisfies 
the criteria of 49 U.S.C. 10705 and 11102, as appropriate. In making 
its determination, the Board shall take into account all relevant 
factors, including:
    (i) The revenues of the involved railroads on the affected traffic 
via the rail routes in question.
    (ii) The efficiency of the rail routes in question, including the 
costs of operating via those routes.
    (iii) The rates or compensation charged or sought to be charged by 
the railroad or railroads from which prescription or establishment is 
sought.
    (iv) The revenues, following the prescription, of the involved 
railroads for the traffic in question via the affected route; the costs 
of the involved railroads for that traffic via that route; the ratios 
of those revenues to those costs; and all circumstances relevant to any 
difference in those ratios; provided that the mere loss of revenue to 
an affected carrier shall not be a basis for finding that a 
prescription or establishment is necessary to remedy or prevent an act 
contrary to the competitive standards of this section; and
    (2) That either:
    (i) The complaining shipper has used or would use the through 
route, through rate, or reciprocal switching to meet a significant 
portion of its current or future railroad transportation needs between 
the origin and destination; or
    (ii) The complaining carrier has used or would use the affected 
through route, through rate, or reciprocal switching for a significant 
amount of traffic.
    (b) Other considerations. (1) The Board will not consider product 
competition.
    (2) If a railroad wishes to rely in any way on geographic 
competition, it will have the burden of proving the existence of 
effective geographic competition by clear and convincing evidence.
    (3) When prescription of a through route, a through rate, or 
reciprocal switching is necessary to remedy or prevent an act contrary 
to the competitive standards of this section, the overall revenue 
inadequacy of the defendant railroad(s) will not be a basis for denying 
the prescription.
    (4) Any proceeding under the terms of this section will be 
conducted and concluded by the Board on an expedited basis.


Sec.  1144.3  General.

    (a) These rules will govern the Board's adjudication of individual 
cases pending on or after the effective date of these rules (October 
31, 1985).
    (b) Discovery under these rules is governed by the Board's general 
rules of discovery at 49 CFR part 1114.
    (c) Any Board determinations or findings under this part with 
respect to compliance or non-compliance with the standards of Sec.  
1144.2 shall not be given any res judicata or collateral estoppel 
effect in any litigation involving the same facts or controversy 
arising under the antitrust laws of the United States.

[FR Doc. 02-24603 Filed 9-27-02; 8:45 am]
BILLING CODE 4915-00-P