PRIA, Government Policy, Made Personal

Summary

Rail carriers that make agreements with other carriers about rates, rules, divisions of money, or how to set or publish rates must apply to the Surface Transportation Board (the Board) for approval. The Board will approve only if the agreement helps federal transportation policy and can add conditions to make it do so. If the Board approves, certain federal antitrust laws (for example, the Sherman Act, the Clayton Act, and the Federal Trade Commission Act) do not apply to making or carrying out the agreement. A few key definitions: "affiliate" means a person or company that controls, is controlled by, or is under common control (ownership of at least 5 percent); "single-line rate" means a rate proposed by one carrier that applies only over its own line; and "practicably participates in the movement" will be defined by the Board. Carriers seeking approval must file a verified statement listing carrier names, headquarters contact, affiliates, and officers and any person or affiliate that owns or controls $1,000,000 or more of debt, equity, or securities. Organizations formed under approved agreements must finish decisions on proposed rates or rules within 120 days. They must keep transcripts or recordings of meetings and vote records and give them to the Board and other federal agencies, though those records remain confidential. Carriers may not discuss or vote on another carrier’s single-line rates, or on interline rates unless a carrier actually takes part in the movement, and the Board can delay these rules if needed. Carriers may, without prior approval, agree only to compile or publish rates; the Board can review and stop any such agreement that goes beyond that. Separate rules cover shipper agreements about payment for shipper-owned rolling stock: those agreements need Board approval within one year, and if parties cannot agree on payment, the Board will decide within 90 days. The Board can inspect records, change or end approvals, start reviews on its own, and receive periodic reports from the FTC and Justice Department about possible anticompetitive problems; those reports are made public.

Title 49, §10706

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(a)(1)In this subsection—

(A)the term “affiliate” means a person controlling, controlled by, or under common control or ownership with another person and “ownership” refers to equity holdings in a business entity of at least 5 percent;

(B)the term “single-line rate” refers to a rate or allowance proposed by a single rail carrier that is applicable only over its line and for which the transportation (exclusive of terminal services by switching, drayage or other terminal carriers or agencies) can be provided by that carrier; and

(C)the term “practicably participates in the movement” shall have such meaning as the Board shall by regulation prescribe.

(2)(A)A rail carrier providing transportation subject to the jurisdiction of the Board under this part that is a party to an agreement of at least 2 rail carriers that relates to rates (including charges between rail carriers and compensation paid or received for the use of facilities and equipment), classifications, divisions, or rules related to them, or procedures for joint consideration, initiation, publication, or establishment of them, shall apply to the Board for approval of that agreement under this subsection. The Board shall approve the agreement only when it finds that the making and carrying out of the agreement will further the transportation policy of section 10101 of this title and may require compliance with conditions necessary to make the agreement further that policy as a condition of its approval. If the Board approves the agreement, it may be made and carried out under its terms and under the conditions required by the Board, and the Sherman Act (15 U.S.C. 1, et seq.), the Clayton Act (15 U.S.C. 12, et seq.), the Federal Trade Commission Act (15 U.S.C. 41, et seq.), section 73 and 74 of the Wilson Tariff Act (15 U.S.C. 8 and 9), and the Act of June 19, 1936 (15 U.S.C. 13, 13a, 13b, 21a) do not apply to parties and other persons with respect to making or carrying out the agreement. However, the Board may not approve or continue approval of an agreement when the conditions required by it are not met or if it does not receive a verified statement under subparagraph (B) of this paragraph.

(B)The Board may approve an agreement under subparagraph (A) of this paragraph only when the rail carriers applying for approval file a verified statement with the Board. Each statement must specify for each rail carrier that is a party to the agreement—

(i)the name of the carrier;

(ii)the mailing address and telephone number of its headquarter’s office; and

(iii)the names of each of its affiliates and the names, addresses, and affiliates of each of its officers and directors and of each person, together with an affiliate, owning or controlling any debt, equity, or security interest in it having a value of at least $1,000,000.

(3)(A)An organization established or continued under an agreement approved under this subsection shall make a final disposition of a rule or rate docketed with it by the 120th day after the proposal is docketed. Such an organization may not—

(i)permit a rail carrier to discuss, to participate in agreements related to, or to vote on single-line rates proposed by another rail carrier, except that for purposes of general rate increases and broad changes in rates, classifications, rules, and practices only, if the Board finds at any time that the implementation of this clause is not feasible, it may delay or suspend such implementation in whole or in part;

(ii)permit a rail carrier to discuss, to participate in agreements related to, or to vote on rates related to a particular interline movement unless that rail carrier practicably participates in the movement; or

(iii)if there are interline movements over two or more routes between the same end points, permit a carrier to discuss, to participate in agreements related to, or to vote on rates except with a carrier which forms part of a particular single route. If the Board finds at any time that the implementation of this clause is not feasible, it may delay or suspend such implementation in whole or in part.

(B)(i)In any proceeding in which a party alleges that a rail carrier voted or agreed on a rate or allowance in violation of this subsection, that party has the burden of showing that the vote or agreement occurred. A showing of parallel behavior does not satisfy that burden by itself.

(ii)In any proceeding in which it is alleged that a carrier was a party to an agreement, conspiracy, or combination in violation of a Federal law cited in subsection (a)(2)(A) of this section or of any similar State law, proof of an agreement, conspiracy, or combination may not be inferred from evidence that two or more rail carriers acted together with respect to an interline rate or related matter and that a party to such action took similar action with respect to a rate or related matter on another route or traffic. In any proceeding in which such a violation is alleged, evidence of a discussion or agreement between or among such rail carrier and one or more other rail carriers, or of any rate or other action resulting from such discussion or agreement, shall not be admissible if the discussion or agreement—

(I)was in accordance with an agreement approved under paragraph (2) of this subsection; or

(II)concerned an interline movement of the rail carrier, and the discussion or agreement would not, considered by itself, violate the laws referred to in the first sentence of this clause.

In any proceeding before a jury, the court shall determine whether the requirements of subclause (I) or (II) are satisfied before allowing the introduction of any such evidence.

(C)An organization described in subparagraph (A) of this paragraph shall provide that transcripts or sound recordings be made of all meetings, that records of votes be made, and that such transcripts or recordings and voting records be submitted to the Board and made available to other Federal agencies in connection with their statutory responsibilities over rate bureaus, except that such material shall be kept confidential and shall not be subject to disclosure under section 552 of title 5, United States Code.

(4)Notwithstanding any other provision of this subsection, one or more rail carriers may enter into an agreement, without obtaining prior Board approval, that provides solely for compilation, publication, and other distribution of rates in effect or to become effective. The Sherman Act (15 U.S.C. 1 et seq.), the Clayton Act (15 U.S.C. 12 et seq.), the Federal Trade Commission Act (15 U.S.C. 41 et seq.), section 73 and 74 of the Wilson Tariff Act (15 U.S.C. 8 and 9), and the Act of June 19, 1936 (15 U.S.C. 13, 13a, 13b, 21a) shall not apply to parties and other persons with respect to making or carrying out such agreement. However, the Board may, upon application or on its own initiative, investigate whether the parties to such an agreement have exceeded its scope, and upon a finding that they have, the Board may issue such orders as are necessary, including an order dissolving the agreement, to ensure that actions taken pursuant to the agreement are limited as provided in this paragraph.

(5)(A)Whenever two or more shippers enter into an agreement to discuss among themselves that relates to the amount of compensation such shippers propose to be paid by rail carriers providing transportation subject to the jurisdiction of the Board under this part, for use by such rail carriers of rolling stock owned or leased by such shippers, the shippers shall apply to the Board for approval of that agreement under this paragraph. The Board shall approve the agreement only when it finds that the making and carrying out of the agreement will further the transportation policy set forth in section 10101 of this title and may require compliance with conditions necessary to make the agreement further that policy as a condition of approval. If the Board approves the agreement, it may be made and carried out under its terms and under the terms required by the Board, and the antitrust laws set forth in paragraph (2) of this subsection do not apply to parties and other persons with respect to making or carrying out the agreement. The Board shall approve or disapprove an agreement under this paragraph within one year after the date application for approval of such agreement is made.

(B)If the Board approves an agreement described in subparagraph (A) of this paragraph and the shippers entering into such agreement and the rail carriers proposing to use rolling stock owned or leased by such shippers, under payment by such carriers or under a published allowance, are unable to agree upon the amount of compensation to be paid for the use of such rolling stock, any party directly involved in the negotiations may require that the matter be settled by submitting the issues in dispute to the Board. The Board shall render a binding decision, based upon a standard of reasonableness and after taking into consideration any past precedents on the subject matter of the negotiations, no later than 90 days after the date of the submission of the dispute to the Board.

(C)Nothing in this paragraph shall be construed to change the law in effect prior to October 1, 1980, with respect to the obligation of rail carriers to utilize rolling stock owned or leased by shippers.

(b)The Board may require an organization established or continued under an agreement approved under this section to maintain records and submit reports. The Board may inspect a record maintained under this section.

(c)The Board may review an agreement approved under subsection (a) of this section and shall change the conditions of approval or terminate it when necessary to comply with the public interest and subsection (a). The Board shall postpone the effective date of a change of an agreement under this subsection for whatever period it determines to be reasonably necessary to avoid unreasonable hardship.

(d)The Board may begin a proceeding under this section on its own initiative or on application. Action of the Board under this section—

(1)approving an agreement;

(2)denying, ending, or changing approval;

(3)prescribing the conditions on which approval is granted; or

(4)changing those conditions,

has effect only as related to application of the antitrust laws referred to in subsection (a) of this section.

(e)(1)The Federal Trade Commission, in consultation with the Antitrust Division of the Department of Justice, shall prepare periodically an assessment of, and shall report to the Board on—

(A)possible anticompetitive features of—

(i)agreements approved or submitted for approval under subsection (a) of this section; and

(ii)an organization operating under those agreements; and

(B)possible ways to alleviate or end an anticompetitive feature, effect, or aspect in a manner that will further the goals of this part and of the transportation policy of section 10101 of this title.

(2)Reports received by the Board under this subsection shall be published and made available to the public under section 552(a) of title 5.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The Sherman Act, referred to in subsec. (a)(2)(A), (4), is act July 2, 1890, ch. 647, 26 Stat. 209, which is classified to sections 1 to 7 of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see

Short Title

note set out under section 1 of Title 15 and Tables. The Clayton Act, referred to in subsec. (a)(2)(A), (4), is act Oct. 15, 1914, ch. 323, 38 Stat. 730, which is classified generally to section 12, 13, 14 to 19, 21, and 22 to 27 of Title 15 and section 52 and 53 of Title 29, Labor. For further details and complete classification of this Act to the Code, see

References in Text

note set out under section 12 of Title 15 and Tables. The Federal Trade Commission Act, referred to in subsec. (a)(2)(A), (4), is act Sept. 26, 1914, ch. 311, 38 Stat. 717, which is classified generally to subchapter I (§ 41 et seq.) of chapter 2 of Title 15. For complete classification of this Act to the Code, see section 58 of Title 15 and Tables. section 73 and 74 of the Wilson Tariff Act, referred to in subsec. (a)(2)(A), (4), are section 73 and 74 of act Aug. 27, 1894, ch. 349, 28 Stat. 570, which enacted section 8 and 9, respectively, of Title 15. Act of

June 19, 1936, referred to in subsec. (a)(2)(A), (4), is act

June 19, 1936, ch. 592, 49 Stat. 1526, popularly known as the Robinson-Patman Anti-discrimination Act and also as the Robinson-Patman Price Discrimination Act, which enacted section 13a, 13b, and 21a of Title 15 and amended section 13 of Title 15. For complete classification of this Act to the Code, see

Short Title

note set out under section 13 of Title 15 and Tables.

Prior Provisions

A prior section 10706, Pub. L. 95–473, Oct. 17, 1978, 92 Stat. 1377; Pub. L. 96–258, § 1(7),

June 3, 1980, 94 Stat. 426; Pub. L. 96–296, § 14(a), (c), (d),

July 1, 1980, 94 Stat. 803, 808; Pub. L. 96–448, title II, § 219(a)–(e), 224(b), Oct. 14, 1980, 94 Stat. 1926–1929; Pub. L. 97–261, § 10(a)–(d), Sept. 20, 1982, 96 Stat. 1109, 1110; Pub. L. 98–216, § 2(12), Feb. 14, 1984, 98 Stat. 5; Pub. L. 99–521, § 7(c), Oct. 22, 1986, 100 Stat. 2995, related to exemption from antitrust laws of rate agreements, prior to the general amendment of this subtitle by Pub. L. 104–88, § 102(a). See section 10706 and 13703 of this title.

Amendments

1996—Subsec. (a)(5)(C). Pub. L. 104–287 substituted “October 1, 1980,” for “the

Effective Date

of the Staggers Rail Act of 1980”.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective Jan. 1, 1996, except as otherwise provided in Pub. L. 104–88, see section 2 of Pub. L. 104–88, set out as a note under section 1301 of this title.

§10706 Rate Agreements: Exemption From Antitrust Laws

Summary

Title 49, §10706

Notes & Related Subsidiaries

Editorial Notes

References in Text

Short Title

References in Text

Short Title

Prior Provisions

Amendments

Effective Date

Statutory Notes and Related Subsidiaries

Effective Date

Citations & Metadata