[Federal Register Volume 61, Number 251 (Monday, December 30, 1996)]
[Rules and Regulations]
[Pages 68668-68672]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-33152]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
49 CFR Part 1313
[STB Ex Parte No. 541]
Railroad Contracts
AGENCY: Surface Transportation Board, DOT.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Surface Transportation Board (Board) adopts revised
regulations governing contracts under 49 U.S.C. 10709 that are entered
into between one or more rail carriers and one or more purchasers of
rail services for the transportation of agricultural products. The
revised regulations reflect the reduced regulatory oversight of rail
transportation contracts introduced by the ICC Termination Act of 1995,
Public Law 104-88, 109 Stat. 803 (1995) (ICCTA).
EFFECTIVE DATE: These rules are effective on January 29, 1997.
FOR FURTHER INFORMATION CONTACT: Beryl Gordon, (202) 927-5660. (TDD for
the hearing impaired: (202) 927-5721.)
SUPPLEMENTARY INFORMATION: In a notice of proposed rulemaking (NPR)
served October 17, 1996 (61 FR 54144), the Board proposed revised
regulations to reflect the reduced regulatory oversight of rail
transportation contracts introduced by the ICCTA. The revised
regulations were proposed by the Board after consideration of comments
received from major shipper and carrier interests in response to an
advance notice of proposed rulemaking served March 26, 1996 (61 FR
13147).
Comments in response to the NPR were received from the Association
of American Railroads, the Kansas Grain and Feed Association, the
Montana Wheat and Barley Committee (MWBC), and the National Grain and
Feed Association. None of the commenters objects to the proposed
regulations, and we will adopt them without substantive change.
While not objecting to the proposed regulations, per se, MWBC
states that it is difficult and expensive for many small grain shippers
to obtain timely information regarding contract summary filings, and
that, in the past, many grain shippers have been unaware of contracts
that might affect them until after the complaint period has passed.
MWBC suggests that the Board institute a procedure to post the contract
summaries filed each day on a ``world wide web internet page readily
accessible to the grain shippers.''
The Board does not currently have the capability to disseminate
information, either its own decisions or materials filed with it, over
the Internet. We do, however, support improvements in the dissemination
of information, and are in the process of developing capability to
disseminate information electronically in the future. Nevertheless, we
cannot at this time determine the feasibility of disseminating
electronically materials filed with us, such as railroad contract
summaries, and thus cannot grant MWBC's request at this time. However,
we are certainly prepared to consider alternative requirements as they
become feasible.
In the meantime, it is important to note that the filing
requirements contained in the proposed regulations have been in effect
for many years, and other shippers and shipper groups have apparently
been able to meet their information needs under the existing filing
requirements, as no commenter other than MWBC has raised the issue. We
are aware of the existence of independent service providers (generally
referred to as watching services) that monitor contract summary filings
for their clients and advise them when filings of interest are made.
MWBC might wish to investigate the feasibility of using such a service.
1 Additionally, MWBC can investigate the feasibility of obtaining
the needed information directly from the rail carriers pursuant to the
information availability requirements of Sec. 1313.5(a)(2) of the
proposed regulations.
---------------------------------------------------------------------------
\1\ MWBC states that mail delivery from Washington takes as long
as 5 to 6 days, but the watching services advise us that they can
and do send contract summaries to their clients by facsimile
transmission.
---------------------------------------------------------------------------
Small Entities
The Board certifies that these rules will not have a significant
economic effect on a substantial number of small entities. They merely
eliminate obsolete
[[Page 68669]]
provisions where regulatory oversight was eliminated, reflect certain
other modest changes effected by the ICCTA, and largely continue
existing contract disclosure requirements for agricultural products.
Environment
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 1313
Agricultural products, Contract summaries, Rail carriers,
Transportation contracts.
Decided: December 17, 1996.
By the Board, Chairman Morgan, Vice Chairman Simmons and
Commissioner Owen.
Vernon A. Williams,
Secretary.
For the reasons set forth in the preamble, the Board revises part
1313 of title 49, chapter X, of the Code of Federal Regulations to read
as follows:
PART 1313--RAILROAD CONTRACTS FOR THE TRANSPORTATION OF
AGRICULTURAL PRODUCTS
Sec.
1313.1 Scope; definition of terms.
1313.2 Contract summary filing requirement.
1313.3 Board review; contract disapproval.
1313.4 Filing procedures and formats for contract summaries.
1313.5 Contract and contract summary availability.
1313.6 Contract summary for agricultural commodities.
1313.7 Contract summary for grain products--involving a port.
1313.8 Contract summary for grain products--not involving a port.
1313.9 Grounds for complaints and contract review.
1313.10 Procedures for complaints and discovery.
Authority: 49 U.S.C. 721(a) and 10709.
Sec. 1313.1 Scope; definition of terms.
(a) This part addresses the provisions of 49 U.S.C. 10709 that
require rail carriers to file with the Board a summary of each contract
for the transportation of agricultural products (including grain, as
defined in 7 U.S.C. 75 and products thereof) and that allow complaints
to be filed with the Board regarding such contracts.
(b) The provisions of this part do not apply to any transportation
that is exempted from the Board's contract regulation pursuant to an
exemption issued under 49 U.S.C. 10502 or former 49 U.S.C. 10505
(repealed effective January 1, 1996).
(c) For purposes of this part, the term contract means an
agreement, including any amendment thereto, entered into by one or more
rail carriers and one or more purchasers of rail services to provide
specified transportation of agricultural products (including grain, as
defined in 7 U.S.C. 75 and products thereof) under specified rates and
conditions. The term amendment includes contract modifications agreed
to by the parties.
(d) An amended contract is treated as a new contract under this
part. Remedies are revived and review is again available, upon
complaint.
Sec. 1313.2 Contract summary filing requirement.
(a) Rail carriers subject to the jurisdiction of the Surface
Transportation Board under 49 U.S.C. 10501 must promptly file with the
Board a summary of each contract entered into for the transportation of
agricultural products.
(b) Contract summaries not in compliance with this part may be
rejected by the Board. If a contract summary is rejected, it will be
considered as not filed, and the carrier must promptly file a corrected
contract summary to replace the rejected summary.
Sec. 1313.3 Board review; contract disapproval.
(a) Board review. (1) No later than 30 days after a contract
summary is filed, the Board may, on complaint, begin a proceeding to
review such contract on the grounds described in Sec. 1313.9.
(2) If the Board begins a proceeding, it shall determine, within 30
days after the proceeding is commenced, whether the contract is in
violation of 49 U.S.C. 10709.
(b) Contract disapproval. If the Board finds that the contract is
in violation of 49 U.S.C. 10709, it will:
(1) Disapprove the contract; or
(2) Where the Board finds unreasonable discrimination, in
accordance with 49 U.S.C. 10709(g)(2)(B)(i), order the contracting
carrier(s) to provide to the complainant(s) rates and service
substantially similar to those contained in the contract at issue, with
such differences in terms and conditions as are justified by the
evidence.
(c) Applicable rates/charges if a contract is disapproved. If the
Board disapproves a contract (or contract amendment), the appropriate
non-contract rates/charges (or the contract provisions otherwise in
effect) will be applicable.
Sec. 1313.4 Filing procedures and formats for contract summaries.
(a) Filing of Summaries. (1) Two copies of each contract summary,
containing the applicable information specified in Secs. 1313.6,
1313.7, or 1313.8, as appropriate, must be filed with the Board as soon
as possible, but no longer than 7 days after the date of the contract
(or contract amendment).
(2) The outside envelope or wrapper containing one or more contract
summaries must be prominently marked ``Rail Contract Summary'' and
addressed to: Tariffs Branch, Surface Transportation Board, Washington,
DC 20423.
(3) A transmittal letter identifying the submitted publication(s),
and the name and telephone number of a contact person, must accompany
each filing of one or more contract summaries. Each transmittal letter
shall clearly indicate in the upper left-hand corner thereof:
(i) The assigned alpha code of the filing carrier;
(ii) The number of summaries transmitted;
(iii) The filing fee enclosed, the account number to be billed, or
the credit card to be charged;
(iv) The transmittal number if the filer utilizes transmittal
numbers; and
(v) If the filing fee is charged to a credit card, the information
must include the credit card number and expiration date, and an
authorized signature.
(b) Contract summary title page. The title page of each contract
summary must contain only the following information:
(1) In the upper right corner, the contract summary number (see
paragraph (c) of this section), followed by the amendment number if an
amended contract summary.
(2) In the center of the page, the filing carrier's name, followed
by the words ``CONTRACT SUMMARY'' or ``AMENDED CONTRACT SUMMARY'', as
applicable, in large print.
(3) Date of contract and its effective date.
(4) In the center lower portion, the individual submitting the
filing, and the name of the individual(s) for service of complaints (if
not the same individual). If not otherwise noted, a complainant may
rely on service to the individual submitting the filing.
(c) Contract summary numbering system. (1) The contract summary
identification number must include the word ``STB,'' the standard
carrier alphabetic code for the filing railroad (limited to four
letters), the letter ``C,'' and a sequential number, with each
separated by a hyphen. The following is
[[Page 68670]]
an example: the 357th contract summary filed by the Conrail would have
the following identification number: ``STB-CR-C-357.''
(2) At its option, the carrier may issue contract summaries with
nonconsecutive numbers if it assigns blocks of numbers for specific
uses. An index to the blocks of reserved numbers shall be filed with
the Board.
(d) Format requirements for contract summary information. (1) The
contract summary must enumerate and have each item required in
Secs. 1313.6, 1313.7 or 1313.8 of this part, as applicable, completed.
When the item does not pertain to the contract, the term ``Not
Applicable'' (``NA'') shall be used.
(2) Changes in prior contract summaries must be underscored and
must be followed by the words ``addition,'' ``deletion,''
``extension,'' ``cancellation,'' or other appropriate descriptive
phrase in parentheses. If the change to the contract is only in
confidential matter, a statement to that effect must be made in the
amended contract summary and must indicate the particular feature to
which the change applies (i.e., rate, special feature, etc.). If ``not
applicable'' is permitted in the original summary under Secs. 1313.6
through 1313.8 of this part, the amended summary may use ``not
applicable'' with a notation that a change pertained only to
confidential data.
(3) Amended contract summaries may not substitute phrases such as
``not applicable'' or ``no change'' where disclosure was required in
the original contact summary (such as in the commodity description);
amended contract summaries must set forth all required non-confidential
terms in the contract, whether amended or not.
Sec. 1313.5 Contract and contract summary availability.
(a)(1) A contract summary filed under these rules shall be made
available for public inspection in the Tariffs Branch of the Surface
Transportation Board.
(2) A contract summary filed under these rules also shall be made
available by the carrier(s) participating in the contract, upon
reasonable request.
(b) Where not already required by Sec. 1313.10(a)(5) of this part,
the contract for which a summary is filed under these rules shall be
provided immediately to the Board, upon request, for its use in
carrying out its functions under the statute.
Sec. 1313.6 Contract summary for agricultural commodities.
(a) Summary information. The summary of a contract for the
transportation of agricultural commodities must contain the following
information:
(1) Carrier names. A list, alphabetically arranged, of the
corporate names of all carriers that are parties to the contract, and
their addresses for service of complaints.
(2) Specific commodity. The specific commodity or commodities to be
transported under the contract. Vague commodity descriptions such as
``grain'' are not permitted, even if that is the commodity description
in the contract.
(3) Shipper identity. The specific identity of the shipper party to
the contract, as well as any other party or parties on whose behalf
that shipper is acting (to the extent known).
(4) Specific origins, destinations, transit points, and other
shipper facilities. (i) Each specific origin and destination point to
and from which the contract applies. Vague descriptions such as
``various points in Kansas'' are not acceptable. Broad geographic
descriptions such as ``all stations in Kansas'' are permitted only to
the extent such terms are actually used in the contract and such
origins and destinations are subject to specific identification by
reference to available publications.
(ii) Each port involved.
(iii) Each transit point identified in the contract.
(iv) Each shipper facility affecting performance under the contract
(if not included in the origin/destination points or transit points),
to the extent identified in the contract or known to the contracting
parties.
(5) Contract duration. (i) The date on which the contract has or
will become applicable to the transportation services covered by the
contract.
(ii) The termination date of the contract, and any terms for
automatic extension or renewal of the contract.
(iii) Any provisions for optional extension.
(6) Rail car data. (i) Either the information in paragraph
(a)(6)(A) of this section or the certified statement in paragraph
(a)(6)(B) of this section as follows:
(A) The number of dedicated cars (or, at the carrier's option, car
days), by major car type, to be used to fulfill the contract or
contract options, including those that are:
(1) Available and owned by the carrier(s) listed in paragraph
(a)(1) of this section;
(2) Available and leased by those carrier(s), with average number
of bad-order cars identified; and
(3) (Optional) On order (for ownership or lease), along with
delivery dates.
(B) A certified statement that:
(1) The shipper will furnish the rail cars used for the
transportation provided under the contract, and that those rail cars
will not be leased from the carrier; or
(2) The contract is restricted to services which do not entail car
supply.
(ii) For contract summaries filed on or before September 30, 1998,
a certified statement that the cumulative equipment total for all
contracts for the transportation of agricultural commodities (including
forest products, but not including wood pulp, wood chips, pulpwood or
paper) does not exceed 40 percent of the capacity of carrier-owned and
-leased cars by applicable car type.
(7) Rates and charges. (i) The specific base rates and/or charges
that would apply without the contract.
(ii) A summary of any escalation provisions in the contract.
(8) Volume. All volume, car and/or train size requirements, as set
forth in the contract, including:
(i) Movement type (single-car, multiple-car, unit-train).
(ii) Minimum and actual volume requirements under the contract, by
applicable period(s) (annual, quarterly, etc.).
(iii) Volume breakpoints affecting the contract.
(9) Special features. The existence (but not the terms or amount)
of any special features, such as transit-time commitments, credit
terms, discounts, switching, special demurrage, guaranteed or minimum
percentages, etc.
(b) Supplemental information. In the event a complaint is filed
that is directed at a carrier's ability to fulfill its common carrier
obligation with carrier-furnished cars, the carrier(s) shall
immediately supplement the information contained in the contract
summary by submitting to the Board, and supplying to the complainant,
additional data on the cars used to fulfill the challenged contract.
This additional data shall include (by major car type used to fulfill
the contract):
(1) Total bad-car orders;
(2) Assigned car obligations; and
(3) Free-running cars.
Sec. 1313.7 Contract summary for grain products--involving a port.
(a) Summary information. The summary of a contract for the
transportation of grain products that involves service to or from a
port must contain the following information:
(1) Carrier names. A list, alphabetically arranged, of the
corporate names of all carriers that are parties to
[[Page 68671]]
the contract, and their addresses for service of complaints.
(2) Specific commodity. The specific commodities to be transported
under the contract. Broad commodity descriptions such as ``grain
products'' are permitted only to the extent that is the commodity
description in the contract.
(3) Contract duration. (i) The date on which the contract has or
will become applicable to the transportation services covered by the
contract.
(ii) The termination date of the contract, and any terms for
automatic extension or renewal of the contract.
(4) Rates and charges. (i) The specific base rates and/or charges
that would apply without the contract.
(ii) The existence (but not the terms or amount) of any escalation
provisions.
(5) Volumes. The existence (but not the terms or amount) of any
provisions regarding movement type (e.g. single-car, multiple-car,
unit-train) or minimum volume requirements.
(6) Special features. The existence (but not the terms or amount)
of special features such as transit time commitments, guaranteed car
supply, minimum percentage of traffic requirements, credit terms,
discounts, etc.
(7) Rail car data. Either the information in paragraph (a)(7)(i) of
this section or the certified statement in paragraph (a)(7)(ii) of this
section as follows:
(i) The number of dedicated cars (or, at the carrier's option, car
days), by major car type, to be used to fulfill the contract or
contract options, including those that are:
(A) Available and owned by the carrier(s) listed in paragraph
(a)(1) of this section;
(B) Available and leased by those carrier(s), with average number
of bad-order cars identified; and
(C) (Optional) On order (for ownership or lease), along with
delivery dates.
(ii) A certified statement that:
(A) The shipper will furnish the rail cars used for the
transportation provided under the contract, and that those rail cars
will not be leased from the carrier; or
(B) The contract is restricted to services which do not entail car
supply.
(8) Ports. (i) The port(s) involved.
(ii) Either the mileages (rounded to the nearest 50 miles) between
the port and each inland origin or destination, or the specific inland
origin and destination points.
(b) Supplemental information. In the event a complaint is filed
that is directed at a carrier's ability to fulfill its common carrier
obligation with carrier-furnished cars, the carrier(s) shall
immediately supplement the information contained in the contract
summary by submitting to the Board, and supplying to the complainant,
additional data on the cars used to fulfill the challenged contract.
This additional data shall include (by major car type used to fulfill
the contract):
(1) Total bad-car orders;
(2) Assigned car obligations; and
(3) Free-running cars.
Sec. 1313.8 Contract summary for grain products--not involving a port.
(a) Summary information. The summary of a contract for the
transportation of grain products that does not involve service to or
from a port must contain the information specified in Sec. 1313.7,
paragraphs (a)(1), (2), (3) and (7). It must also contain the
information specified in Sec. 1313.7(a)(6) if the contract contains
such terms.
(b) Supplemental information. In the event a complaint is filed
that is directed at a carrier's ability to fulfill its common carrier
obligation with carrier-furnished cars, the carrier(s) shall
immediately supplement the information contained in the contract
summary by submitting to the Board, and supplying to the complainant,
additional data specified in Sec. 1313.7(b).
Sec. 1313.9 Grounds for complaints and contract review.
(a) A complaint may be filed against a contract covered by this
part:
(1) By any shipper on the ground that such shipper individually
will be harmed because the contract unduly impairs the ability of the
contracting rail carrier or carriers to meet their common carrier
obligations to the complainant under 49 U.S.C. 11101;
(2) By a port on the ground that such port individually will be
harmed because the contract will result in unreasonable discrimination
against such port; and
(3) By a shipper of agricultural commodities on the ground that
such shipper individually will be harmed because:
(i) The rail carrier has unreasonably discriminated by refusing to
enter into a contract with such shipper for rates and services for the
transportation of the same type of commodity under similar conditions
to the contract at issue, and that such shipper was ready, willing, and
able to enter into such a contract at a time essentially
contemporaneous with the period during which the contract at issue was
offered; or
(ii) The contract constitutes a destructive competitive practice.
(b) Unreasonable discrimination, for purposes of paragraph
(a)(3)(i) of this section, has the same meaning as the term has under
49 U.S.C. 10741.
Sec. 1313.10 Procedures for complaints and discovery.
(a) Complaints, discovery petitions, replies, and appeals--(1)
Initial filing. Complaints must be filed by the 18th day after the
contract summary is filed. Any discovery petition must accompany the
complaint.
(2) Complaint. A complaint must contain the correct, unabbreviated
names and addresses of the complainant(s) and defendant(s). The
complainant must set out the statutory provisions under which it has
standing to file a complaint, and its reasons for requesting that the
Board find the challenged contract unlawful.
(3) Discovery petition. A discovery petition must note on the front
page ``Petition for Discovery of Rail Contract'' and note the contract
(and any applicable amendment) number. It should provide the following
information:
(i) Standing--grounds. The ground upon which the petitioner's
complaint is based under Sec. 1313.9.
(ii) Standing--affected party. Pertinent information regarding the
petitioner's actual or potential participation in the relevant market,
including:
(A) The nature and volume of petitioner's relevant business.
(B) The relevant commodities that petitioner ships or receives.
(C) Comparisons of the petitioner's commodities, locations of
shipping facilities and serving carriers, actual or potential traffic
patterns and serving carrier(s), with the traffic patterns and serving
carrier(s) identified in the contract summary. State whether petitioner
is a consignor or consignee.
(D) The petitioner's ability to ship the commodity in question at a
time generally simultaneous with the challenged contract.
(E) The potential effect of the contract on the petitioner's
relevant business.
(F) Any additional supporting information, including prior
negotiations, if any.
(iii) Relevance. The relevance of the information sought to the
petitioner's challenge to the contract.
(iv) Nexus. Where the complaint challenges a carrier's ability to
perform its common carrier obligation, the nexus between the
information sought and the common carrier obligation of the contracting
carrier(s).
(4) Service of pleadings. The complainant must certify that 2
copies of the complaint, and discovery petition if filed, have been
sent to the
[[Page 68672]]
contracting carrier(s) either by hand, express mail, or other overnight
delivery service the same day as filed at the Board. The contracting
carrier shall in turn serve the contracting shipper with a copy of the
complaint and petition. Replies shall be served in the same manner on
complainant/petitioner.
(5) Submission of contract. Immediately upon the filing of a
complaint, the rail carrier filing the contract summary shall forward
to the Board, by hand, express mail, or other overnight delivery
service, the subject contract or amended contract.
(6) Replies. Replies to the complaint/petition are due within 5
days from the date of filing of the complaint/petition, and in no event
later than noon on the 23rd day following filing of the contract
summary.
(7) Copies. An original and 10 copies of complaints, petitions and
replies must be filed with the Board in a package marked ``Confidential
Rail Contract Material''.
(8) Discovery appeals. If action on a petition for discovery is
taken under delegated authority, that action may be appealed to the
Board, subject to the following:
(i) An appeal must be received within 2 days of the initial
decision, but in no event later than the 28th day after the contract
summary is filed.
(ii) The appeal must be marked ``Appeal of Delegated Authority
Action Regarding Rail Contract Discovery''.
(iii) Telegraphic notice or its equivalent must be given to the
opposing parties.
(iv) Replies to the appeal must be filed within one day after the
appeal is filed.
(v) An original and 10 copies of appeals and replies must be filed
with the Board.
(9) Furnishing of information. If discovery is granted, the carrier
must furnish the required information to the petitioner by the 1st
working day after the Board issues its decision.
(b) Informal discovery. (1) Prior to filing a petition for formal
discovery under paragraph (a) of this section, a petitioner may request
discovery from the carrier.
(2) The carrier must promptly grant or deny the request.
(3) Agreements between carriers and shippers for informal discovery
are permitted under these rules.
(c) Confidentiality. If confidential contract data are filed with
the Board in a pleading, the party filing these data should submit them
as a separate package, clearly marked on the outside ``Confidential
Material Subject to Protective Order.'' The order in paragraph (d) of
this section applies to the parties specified in the order who receive
confidential information through proceedings before the Board or
through informal discovery.
(d) Protective order. Petitioner and carriers, and their duly
authorized agents, shall limit to the contract complaint proceeding the
use of contract information or other confidential commercial
information which may be revealed in the contract, the complaint,
reply, or in any other pleading relating to the contract. This
restriction shall be a condition to release of any contract term to a
petitioner/complainant and shall operate similarly on a carrier in
possession of confidential information which may be contained in a
complaint, petition for discovery, or request for informal disclosure.
Any information pertaining to parties to the contract or subject to the
contract (including consignors, consignees and carriers), or pertaining
to the terms of the contract, or relating to the petitioner's/
complainant's confidential commercial information, must be kept
confidential. Neither the information nor the existence of the
information shall be disclosed to third parties, except for:
consultants or agents who agree, in writing, to be bound by this
regulation; information which is publicly available; information which,
after receipt, becomes publicly available through no fault of the party
seeking to disclose the information after it has become publicly
available, or is acquired from a third party free of any restriction as
to its disclosure. The petitioner/complainant or carrier must take all
necessary steps to assure that the information will be kept
confidential by its employees and agents. No copies of the contract
terms or other confidential information are to be retained by the
parties not originally privy to the data subsequent to the termination
of the proceeding.
(e) Contract review proceeding. If the Board institutes a
proceeding to review the contract, the complainant's case-in-chief is
due 9 days after the institution of the proceeding, but no later than
39 days after the filing of the contract summary. Replies are due 16
days after the institution of the proceeding, but no later than 46 days
after the filing of the contract summary.
[FR Doc. 96-33152 Filed 12-27-96; 8:45 am]
BILLING CODE 4915-00-P
