97-953. Revision of Regulations for Interlocking Rail Officers

[Federal Register Volume 62, Number 10 (Wednesday, January 15, 1997)]
[Rules and Regulations]
[Pages 2041-2043]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-953]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

49 CFR Part 1185

[STB Ex Parte No. 543]


Revision of Regulations for Interlocking Rail Officers

AGENCY: Surface Transportation Board.

ACTION: Final rules.

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SUMMARY: The ICC Termination Act of 1995 (ICCTA) abolished the 
Interstate Commerce Commission (ICC) and transferred certain rail 
regulatory functions to the Surface Transportation Board (Board). The 
ICCTA revised the statute concerning restrictions on officers and 
directors. Under new 49 U.S.C. 11328, individuals seeking to hold the 
position of officer or director only of Class III railroads are no 
longer required to seek Board authorization. This publication contains 
our final rules implementing the statute.

EFFECTIVE DATE: The rules are effective on February 14, 1997.

FOR FURTHER INFORMATION CONTACT: Beryl Gordon, [phone]. [TDD for 
the hearing impaired: [phone].]

SUPPLEMENTARY INFORMATION: In a notice of proposed rulemaking served 
May 10, 1996, and published in the Federal Register on May 13, 1996 (61 
FR 22014), we proposed to revise 49 CFR part 1185 to reflect this 
statutory change (Pub. L. 104-88, 109 Stat. 803 (1995)) and to propose 
other changes to our rules. Comments were filed by Joseph C. Szabo, for 
and on behalf of the United Transportation Union, Illinois Legislative 
Board (UTU), and by the Association of American Railroads (AAR).
    The Board is adopting final rules in this decision. This decision 
is available to all persons for a charge by phoning DC NEWS & DATA, 
INC., at [phone].
    The Board certifies that this rule will not have a significant 
economic effect on a substantial number of small entities. In response 
to the statutory change, this rule will reduce regulation and it 
imposes no new reporting requirements on small entities. Requirements 
for the form of the application have been slightly modified to conform 
to the Board's rules of practice.
    This action will not significantly affect either the quality of the 
human environment or the conservation of energy resources.

[[Page 2042]]

List of Subjects in 49 CFR Part 1185

    Administrative practice and procedure, Railroads.

    Decided: December 31, 1996.

    By the Board, Chairman Morgan, Vice Chairman Simmons, 
Commissioner Owen.
Vernon A. Williams,
Secretary.
    For the reasons set forth in the preamble and under the authority 
of 49 U.S.C. 721(a), title 49, chapter X, part 1185 of the Code of 
Federal Regulations is revised to read as follows:

PART 1185--INTERLOCKING OFFICERS

Sec.
1185.1  Definitions and scope of regulations.
1185.2  Contents of application.
1185.3  Procedures.
1185.4  General authority.
1185.5  Common control.
1185.6  Jointly used terminal properties.

    Authority: 5 U.S.C. 553 and 559 and 49 U.S.C. 721, 10502, and 
11328.


Sec. 1185.1  Definitions and scope of regulations.

    (a) This part addresses the requirement of 49 U.S.C. 11328 
authorization of the Surface Transportation Board (STB) needed for a 
person to hold the position of officer or director of more than one 
rail carrier, except where only Class III carriers are involved. STB 
authorization is not needed for individuals seeking to hold the 
positions of officers or directors only of Class III railroads. 49 
U.S.C. 11328(b).
    (b) When a person is an officer of a Class I railroad and seeks to 
become an officer of another Class I railroad, an application under 49 
U.S.C. 11328(a) (or petition for individual exemption under 49 U.S.C. 
10502) must be filed. All other ``interlocking directorates'' have been 
exempted as a class from the prior approval requirements of 49 U.S.C. 
11328(a), pursuant to 49 U.S.C. 10502 and former 49 U.S.C. 10505. For 
such interlocking directorates exempted as a class, no filing with the 
STB is necessary to invoke the exemption.
    (c) An interlocking directorate exists whenever an individual holds 
the position of officer or director of one rail carrier and assumes the 
position of officer or director of another rail carrier. This provision 
applies to any person who performs duties, or any of the duties, 
ordinarily performed by a director, president, vice president, 
secretary, treasurer, general counsel, general solicitor, general 
attorney, comptroller, general auditor, general manager, freight 
traffic manager, passenger traffic manager, chief engineer, general 
superintendent, general land and tax agent or chief purchasing agent.
    (d) For purposes of this part, a rail carrier means a person 
providing common carrier railroad transportation for compensation 
(except a street, suburban, or interurban electric railway not 
operating as part of the general system of rail transportation), and a 
corporation organized to provide such transportation.


Sec. 1185.2  Contents of application.

    (a) Each application shall state the following:
    (1) The full name, occupation, business address, place of 
residence, and post office address of the applicant.
    (2) A specification of every carrier of which the applicant holds 
stock, bonds, or notes, individually, as trustee, or otherwise; and the 
amount of, and accurate description of, such securities of each carrier 
for which the applicant seeks authority to act. (Whenever it is 
contemplated that the applicant will represent on the board of 
directors of any carrier securities other than those owned by the 
applicant, the application shall describe such securities, state the 
character of representation, the name of the beneficial owner or 
owners, and the general nature of the business conducted by such owner 
or owners.)
    (3) Each and every position with any carrier:
    (i) Which is held by the applicant at the time of the application; 
and
    (ii) Which the applicant seeks authority to hold, together with the 
date and manner of his or her election or appointment thereto and, if 
the applicant has entered upon the performance of his duties in any 
such position, the nature of the duties so performed and the date when 
he first entered upon their performance. (A decision authorizing a 
person to hold the position of director of a carrier will be construed 
as sufficient to authorize that person to serve also as chairman of its 
board of directors or as a member or chairman of any committee or 
committees of such board; and, therefore, when authority is sought to 
hold the position of director, the applicant need not request authority 
to serve in any of such other capacities.)
    (4) As to each carrier covered by the requested authorization, 
whether it is an operating carrier, a lessor company, or any other 
corporation organized for the purpose of engaging in rail 
transportation. (If any such carrier neither operates nor owns any 
railroad providing transportation that is subject to 49 U.S.C. 10501, 
the application shall include a copy of such carrier's charter or 
certificate or articles of incorporation, with amendments to date or, 
if already filed with the former Interstate Commerce Commission (ICC) 
or with the STB, a reference thereto, with any intervening amendments.)
    (5) A full statement of pertinent facts relative to any carrier 
involved which does not make annual reports to the STB.
    (6) Full information as to the relationship--operating, financial, 
competitive, or otherwise--existing between the carriers covered by the 
requested authorization.
    (7) Every corporation--industrial, financial, or miscellaneous--of 
which the applicant is an officer or director, and the general 
character of the business conducted by such corporation.
    (8) The reasons, fully, why the granting of the authority sought 
will not affect adversely either public or private interests.
    (9) Whether or not any other application for authority has been 
made in behalf of the applicant and, if so, the date and docket number 
thereof, by whom made, and the action thereon, if any.
    (b) When application has been made on behalf of any person, a 
subsequent application by that person need not repeat any statement 
contained in the previous application but may incorporate the same by 
appropriate reference.


Sec. 1185.3  Procedures.

    The original application or petition shall be signed by the 
individual applicant or petitioner and shall be verified under oath. 
Petitions and applications should comply with the STB's general rules 
of practice set forth at 49 CFR part 1104. Applications or petitions 
may be made by persons on their own behalf.


Sec. 1185.4  General authority.

    Any person who holds or seeks specific authority to hold positions 
with a carrier may also request general authority to act as an 
interlocking officer for all affiliated or subsidiary companies or 
properties used or operated by that carrier, either separately or 
jointly, with other carriers. A carrier may apply for general authority 
on behalf of an individual who has already received authority to act as 
an interlocking officer. However, a carrier may not apply for general 
authority for an individual who holds a position with another railroad 
which is not an affiliate or subsidiary of the carrier or whose 
properties are not used or operated by the carrier, either separately 
or jointly with other carriers.

[[Page 2043]]

Sec. 1185.5  Common control.

    It shall not be necessary for any person to secure authorization to 
hold the position of officer or director of two or more carriers if 
such carriers are operated under common control or management either:
    (a) Pursuant to approval and authority of the ICC granted under 
former 49 U.S.C. 11343-44 or by the STB granted under 49 U.S.C. 11323-
24; or
    (b) Pursuant to an exemption authorized by the ICC under former 49 
U.S.C. 10505 or by the STB under 49 U.S.C. 10502; or
    (c) Pursuant to a controlling, controlled, or common control 
relationship which has existed between such carriers since before June 
16, 1933.


Sec. 1185.6  Jointly used terminal properties.

    Any person holding the position of officer or director of a carrier 
is relieved from the provisions of this part to the extent that he or 
she may also hold a directorship and any other position to which that 
person may be elected or appointed with a terminal railroad the 
properties of which are operated or used by the carrier jointly with 
other carriers.

[FR Doc. 97-953 Filed 1-14-97; 8:45 am]
BILLING CODE 4915-00-P