PRIA, Government Policy, Made Personal

Summary

The Surface Transportation Board must create, within 1 year of the Act, a voluntary and binding arbitration process to handle certain rail rate and practice complaints. The process covers disputes about rates, demurrage, extra charges, misrouting or mishandling of rail cars, and how a carrier’s published rules are applied to specific shipments. It does not cover requests for licenses or exemptions, broad industry-wide rules for the future, enforcing labor-protection terms, or disputes only between rail carriers. Parties may still use private arbitration if they want. Arbitration can only happen when all relevant parties agree in writing and a complaint is filed or the Board follows other rules it creates. For rate disputes, arbitration may be limited to cases where the carrier has market dominance. The Board can start arbitration within 40 days after a complaint. Once arbitration starts, the Board will not separately review the same dispute between the same parties. Arbitrators come from a Board roster of private-sector experts and must be impartial. If parties cannot agree on an arbitrator, they pick by alternately striking names. Costs charged by the Board and arbitrators are split equally; each party pays its own legal costs. Arbitrators must write decisions with facts and conclusions, follow sound rail economics, and the decisions bind the parties but do not set precedent. An arbitrator must be selected within 14 days of starting arbitration, the evidence phase must finish within 90 days unless extended, and the decision must be issued within 30 days after the record is closed. Awards can include damages or rate prescriptions but are capped: practice disputes up to $2,000,000, rate disputes up to $25,000,000, and any rate prescription no longer than 5 years. A party can ask the Board to review an arbitration decision for certain problems like abuse of authority, conflict with law, economics issues, or exceeding the award limits.

Title 49, §11708

Transportation, Source: USLM XML via OLRC

(a)In General.—

Not later than 1 year after the date of the enactment of the Surface Transportation Board Reauthorization Act of 2015, the Board shall promulgate regulations to establish a voluntary and binding arbitration process to resolve rail rate and practice complaints subject to the jurisdiction of the Board.

(b)Covered Disputes.—

The voluntary and binding arbitration process established pursuant to subsection (a)—

(1)shall apply to disputes involving—

(A)rates, demurrage, accessorial charges, misrouting, or mishandling of rail cars; or

(B)a carrier’s published rules and practices as applied to particular rail transportation;

(2)shall not apply to disputes—

(A)to obtain the grant, denial, stay, or revocation of any license, authorization, or exemption;

(B)to prescribe for the future any conduct, rules, or results of general, industry-wide applicability;

(C)to enforce a labor protective condition; or

(D)that are solely between 2 or more rail carriers; and

(3)shall not prevent parties from independently seeking or utilizing private arbitration services to resolve any disputes the parties may have.

(c)Arbitration Procedures.—

(1)In general.—

The Board—

(A)may make the voluntary and binding arbitration process established pursuant to subsection (a) available only to the relevant parties;

(B)may make the voluntary and binding arbitration process available only—

(i)after receiving the written consent to arbitrate from all relevant parties; and

(ii)(I)after the filing of a written complaint; or

(II)through other procedures adopted by the Board in a rulemaking proceeding;

(C)with respect to rate disputes, may make the voluntary and binding arbitration process available only to the relevant parties if the rail carrier has market dominance (as determined under section 10707); and

(D)may initiate the voluntary and binding arbitration process not later than 40 days after the date on which a written complaint is filed or through other procedures adopted by the Board in a rulemaking proceeding.

(2)Limitation.—

Initiation of the voluntary and binding arbitration process shall preclude the Board from separately reviewing a complaint or dispute related to the same rail rate or practice in a covered dispute involving the same parties.

(3)Rates.—

In resolving a covered dispute involving the reasonableness of a rail carrier’s rates, the arbitrator or panel of arbitrators, as applicable, shall consider the Board’s methodologies for setting maximum lawful rates, giving due consideration to the need for differential pricing to permit a rail carrier to collect adequate revenues (as determined under section 10704(a)(2)).

(d)Arbitration Decisions.—

Any decision reached in an arbitration process under this section— (1)

(2)shall be in writing;

(3)shall contain findings of fact and conclusions;

(4)shall be binding upon the parties; and

(5)shall not have any precedential effect in any other or subsequent arbitration dispute.

(e)Timelines.—

(1)Selection.—

An arbitrator or panel of arbitrators shall be selected not later than 14 days after the date of the Board’s decision to initiate arbitration.

(2)Evidentiary process.—

The evidentiary process of the voluntary and binding arbitration process shall be completed not later than 90 days after the date on which the arbitration process is initiated unless—

(A)a party requests an extension; and

(B)the arbitrator or panel of arbitrators, as applicable, grants such extension request.

(3)Decision.—

The arbitrator or panel of arbitrators, as applicable, shall issue a decision not later than 30 days after the date on which the evidentiary record is closed.

(4)Extensions.—

The Board may extend any of the timelines under this subsection upon the agreement of all parties in the dispute.

(f)Arbitrators.—

(1)In general.—

Unless otherwise agreed by all of the parties, an arbitration under this section shall be conducted by an arbitrator or panel of arbitrators, which shall be selected from a roster, maintained by the Board, of persons with rail transportation, economic regulation, professional or business experience, including agriculture, in the private sector.

(2)Independence.—

In an arbitration under this section, the arbitrators shall perform their duties with diligence, good faith, and in a manner consistent with the requirements of impartiality and independence.

(3)Selection.—

(A)In general.—

If the parties cannot mutually agree on an arbitrator, or the lead arbitrator of a panel of arbitrators, the parties shall select the arbitrator or lead arbitrator from the roster by alternately striking names from the roster until only 1 name remains meeting the criteria set forth in paragraph (1).

(B)Panel of arbitrators.—

If the parties agree to select a panel of arbitrators, instead of a single arbitrator, the panel shall be selected under this subsection as follows:

(i)The parties to a dispute may mutually select 1 arbitrator from the roster to serve as the lead arbitrator of the panel of arbitrators.

(ii)If the parties cannot mutually agree on a lead arbitrator, the parties shall select a lead arbitrator using the process described in subparagraph (A).

(iii)In addition to the lead arbitrator selected under this subparagraph, each party to a dispute shall select 1 additional arbitrator from the roster, regardless of whether the other party struck out the arbitrator’s name under subparagraph (A).

(4)Cost.—

The parties shall share the costs incurred by the Board and arbitrators equally, with each party responsible for paying its own legal and other associated arbitration costs.

(g)Relief.—

(1)In general.—

Subject to the limitations set forth in paragraphs (2) and (3), an arbitral decision under this section may award the payment of damages or rate prescriptive relief.

(2)Practice disputes.—

The damage award for practice disputes may not exceed $2,000,000.

(3)Rate disputes.—

(A)Monetary limit.—

The damage award for rate disputes, including any rate prescription, may not exceed $25,000,000.

(B)Time limit.—

Any rate prescription shall be limited to not longer than 5 years from the date of the arbitral decision.

(h)Board Review.—

If a party appeals a decision under this section to the Board, the Board may review the decision under this section to determine if—

(1)the decision is consistent with sound principles of rail regulation economics;

(2)a clear abuse of arbitral authority or discretion occurred;

(3)the decision directly contravenes statutory authority; or

(4)the award limitation under subsection (g) was violated.

Editorial Notes

References in Text

The date of the enactment of the Surface Transportation Board Reauthorization Act of 2015, referred to in subsec. (a), is the date of enactment of Pub. L. 114–110, which was approved Dec. 18, 2015.

§11708 Voluntary Arbitration of Certain Rail Rates and Practices Disputes

Summary

Title 49, §11708

Notes & Related Subsidiaries

Editorial Notes

References in Text

Citations & Metadata