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Pt. 1180
The names and addresses of the parties to
the documents are as follows:
Vendor, Lessor, Mortgagor, etc: [name and
address]
Vendee, Lessee, Mortgagee, etc: [name and
address].
A description of the equipment covered by
the document follows:
[Type of equipment, amount of each, AAR
designation if any, identifying marks, road
or serial numbers, etc., as outlined in
1177.3(d)(4).]
A fee of llllll is enclosed. Please return the original and any extra copies not
needed by the Board for recordation to
[party to whom documents should be returned].
A short summary of the document to appear in the index follows: [a short summary
as described in 1177.4(a).).
Very truly yours,
llllllllllllllllllllllll
[signature of an executive officer of one of
the parties, their attorney, or representative
in fact.]
[46 FR 54946, Nov. 5, 1981 as amended at 64 FR
53268, Oct. 1, 1999; 74 FR 52910, Oct. 15, 2009]
§ 1177.5 Administrative procedure.
(a) At the time of filing of a document with the Board for recordation, a
consecutive number will be stamped
upon the original document and upon
the copies or the counterparts, with
the date and hour of the filing. A notation acknowledging that the document
has been filed pursuant to 49 U.S.C.
11303 will be made. The original document, along with the notation, will be
returned to the party named in the
transmittal letter and a copy or counterpart will be retained by the Board.
For a secondary document, the number
assigned will be the recordation number of the primary document plus the
next available letter suffix.
(b) The Board will maintain an index
for public use as required by 49 U.S.C
11303(b). There will be an index of parties to documents recorded at the
Board in alphabetical order by the party’s name. If requested by the letter of
transmittal, this index will also be
amended to reflect an assignment
under the name of the party other than
the assignor or assignee to the document. There will also be an index of
documents by number, which will list
secondary documents referenced to the
primary ones. The indexes will contain
the pertinent information furnished by
the parties in the transmittal letter.
(c) The Board cannot judge the validity of documents, nor judge the status
of encumbrances to property as reflected by documents recorded at the
Board. The public is welcome to research the records or use an agent or
attorney to do so, provided that Board
rules concerning handling of the documents are respected.
(d) The public should note that filing
documents with the Board is discretionary and encumbrances exist which
are not on file with the Board.
PARTS 1178–1179 [RESERVED]
Parts 1180–1189—Combinations
and Ownership
PART 1180—RAILROAD ACQUISITION, CONTROL, MERGER, CONSOLIDATION PROJECT, TRACKAGE RIGHTS, AND LEASE PROCEDURES
Subpart A—General Acquisition
Procedures
Sec.
1180.0 Scope and purpose.
1180.1 General policy statement for merger
or control of at least two Class I railroads.
1180.2 Types of transactions.
1180.3 Definitions.
1180.4 Procedures.
1180.5 [Reserved]
1180.6 Supporting information.
1180.7 Market analyses.
1180.8 Operational data.
1180.9 Financial information.
1180.10 Service assurance plans.
1180.11 Transnational and other informational requirements.
Subpart B—Transfer or Operation of Lines
of Railroads in Reorganization
1180.20
Procedures.
AUTHORITY: 5 U.S.C. 553 and 559; 11 U.S.C.
1172; 49 U.S.C. 721, 10502, 11323–11325.
Subpart A—General Acquisition
Procedures
SOURCE: 47 FR 9844, Mar. 8, 1982, unless otherwise noted. Redesignated at 47 FR 49592,
Nov. 1, 1982.
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§ 1180.0
49 CFR Ch. X (10–1–11 Edition)
§ 1180.0 Scope and purpose.
(a) General. The regulations in this
subpart set out the information to be
filed and the procedures to be followed
in control, merger, acquisition, lease,
trackage rights, and any other consolidation transaction involving more than
one railroad that is initiated under 49
U.S.C. 11323. Section 1180.2 separates
these transactions into four types:
Major, significant, minor, and exempt.
The informational requirements for
these types of transactions differ. Before an application is filed, the designation of type of transaction may be
clarified or certain of the information
required may be waived upon petition
to the Board. This procedure is explained in § 1180.4. The required contents of an application are set out in
§§ 1180.6 (general information supporting the transaction), 1180.7 (competitive and market information),
1180.8 (operational information), 1180.9
(financial data), 1180.10 (service assurance plans), and 1180.11 (transnational
and other informational requirements).
A major application must contain the
information required in §§ 1180.6(a),
1180.6(b), 1180.7(a), 1180.7(b), 1180.8(a),
1180.8(b), 1180.9, 1180.10, and 1180.11. A
significant application must contain the
information required in §§ 1180.6(a),
1180.6(c),
1180.7(a),
1180.7(c),
and
1180.8(b). A minor application must contain the information required in
§§ 1180.6(a) and 1180.8(c). Procedures (including time limits, filing requirements, participation requirements, and
other matters) are contained in § 1180.4.
All applications must comply with the
Board’s Rules of General Applicability,
49 CFR parts 1100 through 1129, unless
otherwise specified. These regulations
may be cited as the Railroad Consolidation Procedures.
(b) Waiver. We will waive application
of the regulations contained in this
subpart for a consolidation involving
The Kansas City Southern Railway
Company and another Class I railroad
and instead will apply the regulations
in this subpart A in effect before July
11, 2001 and contained in the 49 CFR,
Parts 1000 to 1199, edition revised as of
October 1, 2000, unless we are shown
why such a waiver should not be allowed. Interested parties must file any
objections to this waiver within 10 days
after the applicants’ prefiling notification (see 49 CFR § 1180.4(b)(1)).
[66 FR 32583, June 15, 2001]
§ 1180.1 General policy statement for
merger or control of at least two
Class I railroads.
(a) General. To meet the needs of the
public and the national defense, the
Surface Transportation Board (Board)
seeks to ensure balanced and sustainable competition in the railroad industry. The Board recognizes that the railroad industry (including Class II and
III carriers) is a network of competing
and complementary components, which
in turn is part of a broader transportation infrastructure that also embraces the nation’s highways, waterways, ports, and airports. The Board
welcomes private-sector initiatives
that enhance the capabilities and the
competitiveness of this transportation
infrastructure. Although mergers of
Class I railroads may advance our nation’s economic growth and competitiveness through the provision of more
efficient and responsive transportation,
the Board does not favor consolidations
that reduce the transportation alternatives available to shippers unless
there are substantial and demonstrable
public benefits to the transaction that
cannot otherwise be achieved. Such
public benefits include improved service, enhanced competition, and greater
economic efficiency. The Board also
will look with disfavor on consolidations under which the controlling entity does not assume full responsibility
for carrying out the controlled carrier’s common carrier obligation to
provide adequate service upon reasonable demand.
(b) Consolidation criteria. The Board’s
consideration of the merger or control
of at least two Class I railroads is governed by the public interest criteria
prescribed in 49 U.S.C. 11324 and the
rail transportation policy set forth in
49 U.S.C. 10101. In determining the public interest, the Board must consider
the various goals of effective competition, carrier safety and efficiency, adequate service for shippers, environmental safeguards, and fair working
conditions for employees. The Board
must ensure that any approved transaction would promote a competitive,
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Surface Transportation Board, DOT
§ 1180.1
efficient, and reliable national rail system.
(c) Public interest considerations. The
Board believes that mergers serve the
public interest only when substantial
and demonstrable gains in important
public benefits—such as improved service and safety, enhanced competition,
and greater economic efficiency—outweigh any anticompetitive effects, potential service disruptions, or other
merger-related harms. Although further consolidation of the few remaining
Class I carriers could result in efficiency gains and improved service, the
Board believes additional consolidation
in the industry is also likely to result
in a number of anticompetitive effects,
such as loss of geographic competition,
that are increasingly difficult to remedy directly or proportionately. Additional consolidations could also result
in service disruptions during the system integration period. Accordingly, to
assure a balance in favor of the public
interest, merger applications should include provisions for enhanced competition, and, where both carriers are financially sound, the Board is prepared
to use its conditioning authority as
necessary under 49 U.S.C. 11324(c) to
preserve and/or enhance competition.
In addition, when evaluating the public
interest, the Board will consider
whether the benefits claimed by applicants could be realized by means other
than the proposed consolidation. The
Board believes that other private-sector initiatives, such as joint marketing
agreements and interline partnerships,
can produce many of the efficiencies of
a merger while risking less potential
harm to the public.
(1) Potential benefits. By eliminating
transaction cost barriers between
firms, increasing the productivity of
investment, and enabling carriers to
lower costs through economies of scale,
scope, and density, mergers can generate important public benefits such as
improved service, more competition,
and greater economic efficiency. A
merger can strengthen a carrier’s finances and operations. To the extent
that a merged carrier continues to operate in a competitive environment, its
new efficiencies would be shared with
shippers and consumers. Both the public and the consolidated carrier can
benefit if the carrier is able to increase
its marketing opportunities and provide better service. A merger transaction can also improve existing competition or provide new competitive opportunities, and such enhanced competition will be given substantial
weight in our analysis. Applicants
shall make a good faith effort to calculate the net public benefits their proposed merger would generate, and the
Board will carefully evaluate such evidence. To ensure that applicants have
no incentive to exaggerate these projected benefits to the public, the Board
expects applicants to propose additional measures that the Board might
take if the anticipated public benefits
fail to materialize in a timely manner.
In this regard, the Board recognizes,
however, that applicants require the
flexibility to adapt to changing marketplace or other circumstances and
that it is inevitable that an approved
merger may not necessarily be implemented in precisely the manner anticipated in the application. Applicants
will be held accountable, however, if
they do not act reasonably in light of
changing circumstances to achieve
promised merger benefits.
(2) Potential harm. The Board recognizes that consolidation can impose
costs as well as benefits. It can reduce
competition both directly and indirectly in particular markets, including
product markets and geographic markets. Consolidation can also threaten
essential services and the reliability of
the rail network. In analyzing these
impacts we must consider, but are not
limited by, the policies embodied in
the antitrust laws.
(i) Reduction of competition. Although
in specific markets railroads operate in
a highly competitive environment with
vigorous intermodal competition from
motor and water carriers, mergers can
deprive shippers of effective options.
Intramodal competition can be reduced
when two carriers serving the same origins or destinations merge. Competition arising from shippers’ build-out,
transloading, plant siting, and production shifting choices can be eliminated
or reduced when two railroads serving
overlapping areas merge. Competition
in product and geographic markets can
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§ 1180.1
49 CFR Ch. X (10–1–11 Edition)
also be eliminated or reduced by mergers, including end-to-end mergers. Any
railroad combination entails a risk
that the merged carrier would acquire
and exploit increased market power.
Applicants shall propose remedies to
mitigate and offset competitive harms.
Applicants shall also explain how they
would at a minimum preserve competitive and market options such as those
involving the use of major existing
gateways, build-outs or build-ins, and
the opportunity to enter into contracts
for one segment of a movement as a
means of gaining the right separately
to pursue rate relief for the remainder
of the movement.
(ii) Harm to essential services. The
Board must ensure that essential
freight, passenger, and commuter rail
services are preserved wherever feasible. An existing service is essential if
there is sufficient public need for the
service and adequate alternative transportation is not available. The Board’s
focus is on the ability of the nation’s
transportation infrastructure to continue to provide and support essential
services. Mergers should strengthen,
not undermine, the ability of the rail
network to advance the nation’s economic growth and competitiveness,
both domestically and internationally.
The Board will consider whether projected shifts in traffic patterns could
undermine the ability of the various
network links (including Class II and
Class III rail carriers and ports) to sustain essential services.
(iii) Transitional service problems. Experience shows that significant service
problems can arise during the transitional period when merging firms integrate their operations, even after applicants take extraordinary steps to avoid
those disruptions. Because service disruptions harm the public, the Board, in
its determination of the public interest, will weigh the likelihood of transitional service problems. In addition,
under paragraph (h) of this section, the
Board will require applicants to provide a detailed service assurance plan.
Applicants also should explain how
they would cooperate with other carriers in overcoming serious service disruptions on their lines during the transitional period and afterwards.
(iv) Enhanced competition. To offset
harms that would not otherwise be
mitigated, applicants should explain
how the transaction and conditions
they propose would enhance competition.
(d) Conditions. The Board has broad
authority under 49 U.S.C. 11324(c) to
impose conditions on consolidations,
including requiring divestiture of parallel tracks or the granting of trackage
rights and access to other facilities.
The Board will condition the approval
of Class I combinations to mitigate or
offset harm to the public interest, and
will carefully consider conditions proposed by applicants in this regard. The
Board may impose conditions that are
operationally feasible and produce net
public benefits, but will not impose
conditions that undermine or defeat
beneficial transactions by creating unreasonable operating, financial, or
other problems for the combined carrier. Conditions are generally not appropriate to compensate parties who
may be disadvantaged by increased
competition. The Board anticipates
that mergers of Class I carriers would
likely create some anticompetitive effects that would be difficult to mitigate through appropriate conditions,
and that transitional service disruptions might temporarily negate any
shipper benefits. To offset such potential harms and improve the prospect
that their proposal would be found to
be in the public interest, applicants
should propose conditions that would
not simply preserve but also enhance
competition. The Board seeks to enhance competition in ways that
strengthen and sustain the rail network as a whole (including that portion of the network operated by Class
II and III carriers).
(e) Employee protection. The Board is
required to provide a fair arrangement
for the protection of the rail employees
of applicants who are affected by a consolidation. The Board supports early
notice and consultation between management and the various unions, leading to negotiated implementing agreements, which the Board strongly favors. Otherwise, the Board respects the
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Surface Transportation Board, DOT
§ 1180.1
sanctity of collective bargaining agreements and will look with extreme disfavor on overrides of collective bargaining agreements except to the very
limited extent necessary to carry out
an approved transaction. The Board
will review negotiated agreements to
ensure fair and equitable treatment of
all affected employees. Absent a negotiated agreement, the Board will provide for protection at the level mandated by law (49 U.S.C. 11326(a)), and if
unusual circumstances are shown,
more stringent protection will be provided to ensure that employees have a
fair and equitable arrangement.
(f) Environment and safety. (1) The National Environmental Policy Act, 42
U.S.C. 4321 et seq. (NEPA), requires the
Board to take environmental considerations into account in railroad consolidation cases. To meet its responsibilities under NEPA and related environmental laws, the Board must consider
significant potential beneficial and adverse environmental impacts in deciding whether to approve a transaction
as proposed, deny the proposal, or approve it with conditions, including appropriate environmental mitigation
conditions addressing concerns raised
by the parties, including federal, state,
and local government entities. The
Board’s Section of Environmental
Analysis (SEA) ensures that the agency meets its responsibilities under
NEPA and the implementing regulations at 49 CFR part 1105 by providing
the Board with an independent environmental review of merger proposals.
In preparing the necessary environmental documentation, SEA focuses on
the potential environmental impacts
resulting from merger-related changes
in activity levels on existing rail lines
and rail facilities. The Board generally
will mitigate only those impacts that
would result directly from an approved
transaction, and will not require mitigation for existing conditions and existing railroad operations.
(2) During the environmental review
process, railroad applicants have negotiated agreements with affected communities, including groups of communities and other entities such as state
and local agencies. The Board encourages voluntary agreements of this nature because they can be extremely
helpful and effective in addressing specific local and regional environmental
and safety concerns, including the
sharing of costs associated with mitigating merger-related environmental
impacts. Generally, these privately negotiated solutions between an applicant railroad and some or all of the
communities along particular rail corridors or other appropriate entities are
more effective, and in some cases more
far-reaching, than any environmental
mitigation options the Board could impose unilaterally. Therefore, when such
agreements are submitted to it, the
Board generally will impose these negotiated agreements as conditions to
approved mergers, and these agreements generally will substitute for specific local and site-specific environmental mitigation for a community
that otherwise would be imposed.
Moreover, to encourage and give effect
to negotiated solutions whenever possible, the opportunity to negotiate
agreements will remain available
throughout the oversight process to replace local and site-specific environmental mitigation imposed by the
agency. The Board will require compliance with the terms of all negotiated
agreements submitted to it during
oversight by imposing appropriate environmental conditions to replace the
local and site-specific mitigation previously imposed.
(3) Applicants will be required to
work with the Federal Railroad Administration, on a case-by-case basis, to
formulate Safety Integration Plans
(SIPs) to ensure that safe operations
are maintained throughout the merger
implementation process. As part of the
environmental review process, applicants will be required to submit:
(i) A SIP and
(ii)
Evidence
about
potentially
blocked grade crossings as a result of
merger-related traffic increases or
operational changes.
(g) Oversight. As a condition to its approval of any major transaction, the
Board will establish a formal oversight
process. For at least the first 5 years
following approval, applicants will be
required to present evidence to the
Board, on no less than an annual basis,
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§ 1180.1
49 CFR Ch. X (10–1–11 Edition)
to show that the merger conditions imposed by the Board are working as intended, that the applicants are adhering to the various representations they
made on the record during the course
of their merger proceeding, that no unforeseen harms have arisen that would
require the Board to alter existing
merger conditions or impose new ones,
and that the merger benefit projections
accepted by the Board are being realized in a timely fashion. Parties will be
given the opportunity to comment on
applicants’ submissions, and applicants
will be given the opportunity to reply
to the parties’ comments. During the
oversight period, the Board will retain
jurisdiction to impose any additional
conditions it determines are necessary
to remedy or offset adverse consequences of the underlying transaction.
(h) Service assurance and operational
monitoring. (1) The quality of service is
of vital importance. Accordingly, applicants must file, with their initial application and operating plan, a Service
Assurance Plan identifying the precise
steps they would take to ensure adequate service and to provide for improved service. This plan must include
the specific information set forth at
§ 1180.10 on how shippers, connecting
railroads (including Class II and III
carriers), and ports across the new system would be affected and benefitted
by the proposed consolidation. As part
of this plan, applicants will be required
to provide service benchmarks, describe the extent to which they have
entered into any arrangements with
shippers and shipper groups to compensate for service failures, and establish contingency plans that would be
available to mitigate any unanticipated service disruption.
(2) The Board will conduct significant
post-approval operational monitoring
to help ensure that service levels after
a merger are reasonable and adequate.
(3) The Board also will require applicants to establish problem resolution
teams and specific procedures for problem resolution to ensure that any unanticipated post-merger problems related to service or any other transportation matters, including claims, are
promptly addressed. These teams
should include representatives of all
appropriate employee categories. Also,
the Board envisions the establishment
of a Service Council made up of shippers, railroads, passenger service representatives, ports, rail labor, and
other interested parties to provide an
ongoing forum for the discussion of implementation issues.
(4) Loss and damage claims handling.
Shippers or shortlines who have freight
claims under 49 CFR part 1005 during
merger implementation shall file such
claims, in writing or electronically,
with the merged carrier. The claimant
shall provide supporting documentation regarding the effect on the claimant, and the specific damages (in a determinable amount) incurred. Pursuant
to 49 CFR part 1005, the merged carrier
shall acknowledge each claim within 30
days and successively number each
claim. Within 120 days of carrier receipt of the claim, the merged carrier
shall respond to each claim by paying,
declining, or offering a compromise
settlement. The Board will take notice
of these claims and their disposition as
a matter of oversight. During each annual oversight period, the merged carrier shall report on claims received,
their type, and their disposition for
each quarterly period covered by oversight. While shippers and shortlines
may also contract with the applicants
for specific remedies with respect to
claims, final adjudication of contract
issues as well as unresolved claims will
remain a matter for the courts.
(5) Service failure claims. Applicants
must suggest a protocol for handling
claims related to failure to provide reasonable service due to merger implementation problems. Commitments to
submit all such claims to arbitration
will be favored.
(6) Alternative rail service. Where shippers and connecting railroads require
relief from extended periods of inadequate service, the procedures at 49
CFR parts 1146 and 1147 are available
for the Board to review the documented service levels and to consider
shipper proposals for alternative service relief when other avenues of relief
have already been explored with the
merged carrier in an effort to restore
adequate service.
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Surface Transportation Board, DOT
§ 1180.2
(i) Cumulative impacts and crossover effects. Because there are so few remaining Class I carriers and the railroad industry constitutes a network of competing and complementary components, the Board cannot evaluate the
merits of a major transaction in isolation. The Board must also consider the
cumulative impacts and crossover effects likely to occur as rival carriers
react to the proposed combination. The
Board expects applicants to explain
how additional Class I mergers would
affect the eventual structure of the industry and the public interest. Applicants should generally discuss the likely impact of such future mergers on
the anticipated public benefits of their
own merger proposal. Applicants will
be expected to discuss whether and how
the type or extent of any conditions
imposed on their proposed merger
would have to be altered, or any new
conditions imposed, should we approve
any future consolidation(s).
(j) Inclusion of other carriers. The
Board will consider requiring inclusion
of another carrier as a condition to approval only where there is no other
reasonable alternative for providing essential services, the facilities fit operationally into the new system, and inclusion can be accomplished without
endangering the operational or financial success of the new company.
(k) Transnational and other informational issues. (1) All applicants must
submit ‘‘full system’’ competitive analyses
and
operating
plans—incorporating any operations in Canada or
Mexico—from which we can determine
the competitive, service, employee,
safety, and environmental impacts of
the prospective operations within the
United States, and explain how cooperation with the Federal Railroad
Administration would be maintained to
address potential impacts on operations within the United States of operations or events elsewhere on their
systems. All applicants must further
provide information concerning any restrictions or preferences under foreign
or domestic law and policies that could
affect their commercial decisions. Applicants must also address how any
ownership restrictions might affect our
public interest assessment.
(2) The Board will consult with relevant officials, as appropriate, to ensure that any conditions it imposes on
an approved transaction are consistent
with the North American Free Trade
Agreement and other pertinent international agreements to which the
United States is a party. In addition,
the Board will cooperate with those Canadian and Mexican agencies charged
with approval and oversight of a proposed transnational railroad combination.
(l) National defense. Rail mergers
must not detract from the ability of
the United States military to rely on
rail transportation to meet the nation’s defense needs. Applicants must
discuss and assess the national defense
ramifications of their proposed merger.
(m) Public participation. To ensure a
fully developed record on the effects of
a proposed railroad consolidation, the
Board encourages public participation
from federal, state, and local government departments and agencies; affected shippers, carriers, and rail labor;
and other interested parties.
[66 FR 32583, June 15, 2001]
§ 1180.2
Types of transactions.
Transactions proposed under 49
U.S.C. 11323 involving more than one
common carrier by railroad are of four
types: Major, significant, minor, and exempt.
(a) A major transaction is a control or
merger involving two or more class I
railroads.
(b) A significant transaction is a
transaction not involving the control
or merger of two or more class I railroads that is of regional or national
transportation significance as that
phrase is used in 49 U.S.C. 11325(a)(2)
and (c). A transaction not involving
the control or merger of two or more
class I railroads is not significant if a
determination can be made either:
(1) That the transaction clearly will
not have any anticompetitive effects,
or
(2) That any anticompetitive effects
of the transaction will clearly be outweighed by the transaction’s anticipated contribution to the public interest in meeting significant transportation needs.
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§ 1180.3
49 CFR Ch. X (10–1–11 Edition)
A transaction not involving the control or merger of two or more class I
railroads is significant if neither such
determination can clearly be made.
(c) A minor transaction is one which
involves more than one railroad and
which is not a major, significant, or exempt transaction.
(d) A transaction is exempt if it is
within one of the eight categories described in paragraphs (d)(1) through (8).
The Board has found that its prior review and approval of these transactions
is not necessary to carry out the rail
transportation policy of 49 U.S.C. 10101;
and is of limited scope or unnecessary
to protect shippers from market abuse.
See 49 U.S.C. 10502. A notice must be
filed to use one of these class exemptions. The procedures are set out in
§ 1180.4(g). These class exemptions do
not relieve a carrier of its statutory
obligation to protect the interests of
employees. See 49 U.S.C. 10502(g) and
11326. The enumeration of the following
categories of transactions as exempt
does not preclude a carrier from seeking an exemption of specific transactions not falling into these categories.
(1) Acquisition of a line of railroad
which would not constitute a major
market extension where the Board has
found that the public convenience and
necessity permit abandonment.
(2) Acquisition or continuance in control of a nonconnecting carrier or one
of its lines where (i) the railroads
would not connect with each other or
any railroads in their corporate family,
(ii) the acquisition or continuance in
control is not part of a series of anticipated transactions that would connect
the railroads with each other or any
railroad in their corporate family, and
(iii) the transaction does not involve a
class I carrier.
(3) Transactions within a corporate
family that do not result in adverse
changes in service levels, significant
operational changes, or a change in the
competitive balance with carriers outside the corporate family.
(4) Renewal of leases and any other
matters where the Board has previously authorized the transaction, and
only an extension in time is involved.
(5) Joint projects involving the relocation of a line of railroad which does
not disrupt service to shippers.
(6) Reincorporation in a different
State.
(7) Acquisition of trackage rights and
renewal of trackage rights by a rail
carrier over lines owned or operated by
any other rail carrier or carriers that
are: (i) based on written agreements,
and (ii) not filed or sought in responsive applications in rail consolidation
proceedings.
(8) Acquisition of temporary trackage rights by a rail carrier over lines
owned or operated by any other rail
carrier or carriers that are: (i) based on
written agreements, (ii) not filed or
sought in responsive applications in
rail consolidation proceedings, (iii) for
overhead operations only, and (iv)
scheduled to expire on a specific date
not to exceed 1 year from the effective
date of the exemption. If the operations contemplated by the exemption
will not be concluded within the 1-year
period, the parties may, prior to expiration of the period, file a request for a
renewal of the temporary rights for an
additional period of up to 1 year, including the reason(s) therefor. Rail carriers acquiring temporary trackage
rights need not seek authority from
the Board to discontinue the trackage
rights as of the expiration date specified under 49 CFR 1180.4(g)(2)(iii). All
transactions under these rules will be
subject to applicable statutory labor
protective conditions.
[47 FR 9844, Mar. 8, 1982. Redesignated at 47
FR 49592, Nov. 1, 1982, and amended at 50 FR
15751, Apr. 22, 1985; 51 FR 24669, July 8, 1986;
58 FR 63104, Nov. 30, 1993; 62 FR 9716, Mar. 4,
1997; 68 FR 28140, May 23, 2003]
§ 1180.3 Definitions.
(a) Applicant. The term applicant
means the parties initiating a transaction, but does not include a wholly
owned direct or indirect subsidiary of
an applicant if that subsidiary is not a
rail carrier. Parties who are considered
applicants, but for whom the information normally required of an applicant
need not be submitted, are:
(1) In minor trackage rights applications, the transferor and
(2) In responsive applications, a primary applicant.
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Surface Transportation Board, DOT
§ 1180.4
(b) Applicant carriers. The term applicant carriers means: any applicant that
is a rail carrier; any rail carrier operating in the United States, Canada,
and/or Mexico in which an applicant
holds a controlling interest; and all
other rail carriers involved in the
transaction. Because the service provided by these commonly controlled
carriers can be an important competitive aspect of the transactions that we
approve, applicant carriers are subject
to the full range of our conditioning
power. Carriers that are involved in an
application only by virtue of an existing trackage rights agreement with applicants are not applicant carriers.
(c) Major market extension. A major
market extension is a transaction
which may significantly increase competition by extending service into a
new market, expanding service in a
currently served market when another
carrier concurrently contracts its service to that market as part of the same
transaction, or providing significantly
more efficient and effective competitive service to a market presently
being served. Criteria which can be
used to determine if a railroad is proposing to provide a more competitive
service to a currently served area include: (1) Creating a shorter route; (2)
providing enhanced service capabilities
(speed is not the only factor); (3) entering an interchange or market generating more than 5,000 cars per year or
5 percent of applicant’s traffic; (4) filing the application as a condition of relief to a pending proceeding; and (5)
permitting a carrier to become more
competitive (extending its length of
haul) See. Burlington Northern, Inc.—
Control & Merger—St. L., 354 I.C.C. 616,
617 (1978).
(d) Petition for clarification. A request
that the Board clarify the applicability
of any part of these regulations to a
particular situation or explain the type
of material needed to comply with
these regulations.
(e) Petition for waiver. A request that
the Board either dispense with material required by the regulations, or accept material in place of that required
by these regulations.
(f) Primary application. A proposal for
approval filed under 49 U.S.C. 11323
which begins a new proceeding and is
not proposed either as a condition to or
as an alternative to Board approval of
another pending application.
(g) Railroad. Any common carrier by
railroad as defined in 49 U.S.C. 10102(5)–
(6).
(h) Responsive applications. Applications filed in response to a primary application are those seeking affirmative
relief either as a condition to or in lieu
of the approval of the primary application. Responsive applications include
inconsistent applications, inclusion applications, and any other affirmative
relief that requires an application, petition, notice, or any other filing to be
submitted to the Board (such as trackage rights, purchases, constructions,
operation, pooling, terminal operations, abandonments, and other types
of proceedings not otherwise covered).
For fees covering inconsistent applications or responsive applications not
otherwise covered in the Board’s fee
schedule, see 49 CFR 1002.2(f) (38)–(41)
and 1180.4(d)(4)(ii). The fees for all
other responsive applications are set
forth in 49 CFR 1002.2(f).
(i) Transferee. The transferee is:
(1) The acquiring corporation in a
control proceeding,
(2) The surviving corporation in a
merger,
(3) The resulting corporation in a
consolidation,
(4) The leasee in a lease,
(5) The purchaser in an acquisition,
and
(6) The grantee of trackage rights in
a trackage rights proceeding.
(j) Transferor. The transferor is:
(1) The corporation acquired in a control proceeding,
(2) The merging corporation in a
merger,
(3) All corporations to be consolidated in a consolidation,
(4) The lessor in a lease,
(5) The seller in an acquisition, and
(6) The grantor of trackage rights in
a trackage rights proceeding.
[47 FR 9844, Mar. 8, 1982. Redesignated at 47
FR 49592, Nov. 1, 1982, as amended at 62 FR
9716, Mar. 4, 1997; 62 FR 28376, May 23, 1997; 66
FR 32586, June 15, 2001]
§ 1180.4 Procedures.
(a) General. (1) The original and 25
copies of all documents shall be filed in
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§ 1180.4
49 CFR Ch. X (10–1–11 Edition)
major proceedings. The original and 10
copies shall be filed in significant and
minor proceedings.
(2) Each party to a proceeding shall
choose a unique acronym of four letters or less for itself. It shall number
each document filed in the proceeding
consecutively, prefixed by its acronym.
(3) Any document filed with the
Board (including applications, pleadings, etc.) shall be promptly furnished
to interested persons on request, unless
subject to a protective order. At any
time, the Board may require the submission of additional copies of any document previously filed by any party to
the proceeding.
(b) Prefiling notification. (1) Between 3
to 6 months prior to the proposed filing
of an application in a major transaction, and 2 to 4 months prior to the
proposed filing of an application in a
significant transaction, applicant shall
file a notice with the Board. The notice
shall:
(i) Briefly describe the transaction,
(ii) Indicate the year to be used for
the impact analysis,
(iii) Indicate the approximate filing
date of the application, and
(iv) Indicate why the transaction is
major or significant.
(2) The Board will publish a notice in
the FEDERAL REGISTER within 30 days
of receipt of the applicant’s notice. The
publication shall contain:
(i) A brief description of the transaction,
(ii) The year to be used for the impact analysis,
(iii) The approximate filing date,
(iv) A determination that the transaction is major, significant, or minor,
and
(v) A statement of any additional information which must be filed with the
application in order for the application
to be considered complete.
(3) A prefiling notice may be amended to indicate a change in the anticipated filing date.
(4) Prefiling notification. When filing
the notice of intent required by paragraph (b)(1) of this section, applicants
also must file:
(i) A proposed procedural schedule. In
any proceeding involving either a
major transaction or a significant
transaction, the Board will publish a
FEDERAL REGISTER notice soliciting
comments on the proposed procedural
schedule, and will, after review of any
comments filed in response, issue a
procedural schedule governing the
course of the proceeding.
(ii) A proposed draft protective order.
The Board will issue, in each proceeding in which such an order is requested, an appropriate protective
order.
(iii) A statement of waybill availability
for major transactions. Applicants must
indicate, as soon as practicable after
the issuance of a protective order, that
they will make their 100% traffic tapes
available (subject to the terms of the
protective order) to any interested
party on written request. The applicants may require that, if the requesting party is itself a railroad, applicants
will make their 100% traffic tapes
available to that party only if it
agrees, in its written request, to make
its own 100% traffic tapes available to
applicants (subject to the terms of the
protective order) when it receives access to applicants’ tapes.
(iv) Applicants may also propose the
use of a voting trust at this stage, or at
a later stage, if that becomes necessary. In each proceeding involving a
major transaction, applicants contemplating the use of a voting trust must
explain how the trust would insulate
them from an unlawful control violation and why their proposed use of the
trust, in the context of their impending
control application, would be consistent with the public interest. Following a brief period of public comment and replies by applicants, the
Board will issue a decision determining
whether applicants may establish and
use the trust.
(c) Application. (1) The fees for filing
applications, petitions, or notices
under these procedures are set forth in
49 CFR 1002.2.
(2) Filing requirements. (i) The original
of all applications shall be signed in
ink by the applicant, if an individual;
by all partners, if a partnership; and if
a corporation, association, or other
similar form of organization, by its
president, or such other executive officer having knowledge of the matters
therein contained and duly designated
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Surface Transportation Board, DOT
§ 1180.4
for that purpose by the applicant. Applications shall be made under oath
and shall contain an appropriate certification (if a corporation, by its secretary) showing that the affiant is duly
authorized to verify and file the application. Any person controlling an applicant shall also sign the application.
(ii) The application shall be filed
with Chief, Section of Administration,
Office of Proceedings, Surface Transportation Board, Washington, DC 20423–
0001.
(iii) Each copy of the application
shall conform in all respects to the
original and shall be complete in itself
except that the signature in the copies
may be stamped or typed and the notarial seal may be omitted. In like
manner, where certified copies of documents are filed with the application,
conformed copies thereof, showing certification in stamped or typewritten
form, will be sufficient to accompany
the additional copies of the application.
(iv) All applications required to be
filed with the Board or served on designated persons shall include all exhibits, except as otherwise specifically
noted. Information from other documents may be incorporated by reference in the application. However, the
documents must have been filed with
the Board within three years prior to
filing of the application, the information must be up to date, and applicant
must be prepared to supply copies of
this information to interested persons
on specific request.
(v) The applicant shall submit such
additional information to support its
application as the Board may require.
(vi) Applicant shall file concurrently
all directly related applications, e.g.,
those seeking authority to construct or
abandon rail lines, obtain terminal operations, acquire trackage rights, etc.
(vii) The application shall contain a
certificate of service indicating that
all persons designated in § 1180.4(c)(5)
have been served with a copy of the application.
(3) In a major or significant transaction, and in all responsive applications, all of the direct testimony of applicants, in the form of verified statements, shall be filed and served with
each application.
(4) The application and all exhibits
shall be considered part of the evidentiary record upon acceptance. Any
portion of an application and exhibits
will remain subject to motions to
strike. However, no motion need be
made to have the application and exhibits admitted to the evidentiary
record. If a major or significant transaction is designated for oral hearing
the presiding Administrative Law
Judge shall have discretion in extraordinary circumstances to allow for the
presentation of oral or written direct
testimony not previously submitted
with the application.
(5) Service. The applicant shall serve
a conformed copy of an application
filed under these procedures by firstclass mail upon:
(i) The Governor (or Executive Officer), Public Service Commission, and
the Department of Transportation of
each State in which any part of the
properties of the applicant carriers involved in the proposed transaction is
situated;
(ii) The Secretary of the United
States Department of Transportation
(Docket Clerk, Office of Chief Counsel,
Federal
Railroad
Administration,
Room 5101, 400 Seventh Street, SW.,
Washington, DC 20590).
(iii) The Attorney General of the
United States;
(iv) The Federal Trade Commission;
and
(v) In major or significant transactions, all persons requesting a copy
after the prefiling notice is published
in the FEDERAL REGISTER.
(6) Application format. (i) The application shall be in the same sequence as
the information is requested in these
procedures, and shall be numbered to
correspond to the numbering in the
procedures.
(ii) If any material required in the
application would lend itself to being
placed in an appendix, this should be
done. The appendix and application
shall be tabulated and cross-referenced
in an index for ease in locating and referring to the information. The appendixes shall be in the same sequence as
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§ 1180.4
49 CFR Ch. X (10–1–11 Edition)
the information required by these procedures. If certain information required in the application is not applicable, provide an explanation. The application should be bound, and it may
be bound in more than one volume. If
an application is more than one volume, the cover of each volume should
be in a different color. The pages in
each volume shall begin with 1, and be
sequentially numbered.
(iii) The Board’s Office of Proceedings will provide informal opinions
and interpretations, which are not
binding on the Board, regarding the
format of or information to be included
in the application.
(iv) All filing, service, or other requirements of these procedures must be
complied with when filing the application. Copies of the application filed
with the Board shall be marked in red
‘‘Railroad Consolidation Application’’
on the transmittal envelope or package.
(v) The application shall conform to
the typographical specifications of
§ 1104.2.
(vi) The information and data required of any applicant may be consolidated with the information and data
required of the affiliated applicant carriers.
(7) Acceptance or rejection of an application.
(i) The Board shall accept a complete
application no later than 30 days after
the application is filed with the Board
by publishing a notice in the FEDERAL
REGISTER. A complete application contains all information for all applicant
carriers required by these procedures,
except as modified by advance waiver.
The publication shall indicate the applicable time limits for processing the
application. (These are the time limits
of 49 U.S.C. 11325(b) for a major transaction, 49 U.S.C. 11325(c) for a significant transaction, and 49 U.S.C. 11325(d)
for a minor transaction.)
(ii) The Board shall reject an incomplete application by serving a decision
no later than 30 days after the application is filed with the Board. The decision shall explain specifically why the
application was incomplete. A revised
application may be submitted, incorporating portions of the prior application by reference. The resubmission or
refiling of an application shall be considered a de novo filing for the purpose
of computation of the time periods,
provided that the resubmitted application is accepted as complete.
(8) The application must present a
prima facie case. Applicants can fail to
meet their burden of proof and thus not
present a prima facie case either by (i)
disclosing facts that, even if construed
in their most favorable light, are insufficient to support a finding that the
proposal is consistent with the public
interest, or by (ii) disclosing facts that
affirmatively demonstrate that the
proposal is not in the public interest.
See Ex Parte No. 282 (Sub-No. 3A), Railroad Consolidation Procedures Expedited
Processing, 363 I.C.C. 767 (1980).
(d) Responsive applications. (1) No responsive applications shall be permitted to minor transactions.
(2) An inconsistent application will
be classified as a major, significant, or
minor transaction as provided in
§ 1180.2(a) through (c). The fee for an inconsistent application will be the fee
for the type of transaction involved.
See 49 CFR 1002.2(f)(38) through (41).
The fee for any other type of responsive application is the fee for the particular type of proceeding set forth in
49 CFR 1002.2(f).
(3) Each responsive application filed
and accepted for consideration will
automatically be consolidated with the
primary application for consideration.
(e) Evidentiary proceeding. (1) The
Board may order an oral public hearing, a hearing by written submissions,
or another kind of evidentiary proceeding. The determination will generally be made on the basis of the
needs indicated by the written comments.
(2) The evidentiary proceeding will be
completed:
(i) Within 1 year after the primary
application is accepted for a major
transaction;
(ii) Within 180 days for a significant
transaction; and
(iii) Within 105 days for a minor transaction.
(3) A final decision on the primary
application and on all consolidated
cases will be issued:
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Surface Transportation Board, DOT
§ 1180.4
(i) Within 90 days after the conclusion of the evidentiary proceeding for a
major transaction;
(ii) Within 90 days for a significant
transaction; and
(iii) Within 45 days for a minor transaction.
(4) The Secretary of Transportation
may propose modifications to any
transaction and shall have standing to
appear before the Board in support of
any such proposed modification.
(f) Waiver or clarification. (1) Upon petition of a prospective applicant, the
Board may waive or clarify a portion of
these procedures. A petition to waive
all of the procedures will not be entertained.
(2) Except as otherwise provided in
the procedural schedule adopted by the
Board in any particular proceeding, petitions for waiver or clarification must
be filed at least 45 days before the application is filed.
(3) No replies to a petition for waiver
will be permitted, except where a proceeding involving the same parties and
a related transaction is pending before
us. 1 When a reply is permitted, the petition shall be served by first-class
mail on all parties to the pending proceedings, with a reply due within 10
days of service. Replies to a petition
for clarification shall be permitted
within 10 days of the petition’s filing.
(4) A waiver or clarification granted
to any applicant in a proceeding shall
apply to any other party to the proceeding unless otherwise indicated.
(5) All petitions for waiver or clarification must specify the sections for
which waiver or clarification is sought
and give the specific reasons why each
waiver or clarification is necessary.
(g) Notice of exemption. (1) To qualify
for an exemption under section
1180.2(d), a railroad must file a verified
notice of the transaction with the
Board at least 30 days before the transaction is consummated indicating the
proposed consummation date. Before a
notice is filed, the railroad shall obtain
a docket number from the Board’s Section of Administration, Office of Proceedings.
1 See Itel Corp.—Control-Green Bay and W.
R. Co., 354 I.C.C. 232, 233 (1978).
(i) The notice shall contain the information required in § 1180.6(a)(1)(i)–(iii),
(a)(5)–(6), and (a)(7)(ii), and indicate the
level of labor protection to be imposed.
(ii) The Board shall publish a notice
in the FEDERAL REGISTER within 16
days of the filing of the notice of exemption. The publication will indicate
the labor protection required. If the notice of exemption contains false or misleading information which is brought
to the Board’s attention, the Board
shall summarily revoke the exemption
for that carrier and require divestiture.
(iii) The filing of a petition to revoke
under 49 U.S.C. 10502(d) does not stay
the effectiveness of an exemption. Stay
petitions must be filed at least 7 days
before the exemption becomes effective.
(iv) Other exemptions that may be
relevant to a proposal under this provision are codified at 49 CFR part 1150,
subpart D, which governs transactions
under 49 U.S.C. 10901.
(2)(i) To qualify for an exemption
under § 1180.2(d)(7) (acquisition or renewal of trackage rights agreements),
in addition to the notice, the railroad
must file a caption summary suitable
for publication in the FEDERAL REGISTER. The caption summary must be
in the following form:
Surface Transportation Board
Notice of Exemption
Finance Docket No.
(1)—Trackage Rights—(2)
(2) (3) to grant (4) trackage rights to (1) between (5). The trackage rights will be effective on (6).
This notice is filed under § 1180.2(d)(7). Petitions to revoke the exemption under 49
U.S.C. 10502(d) may be filed at any time. The
filing of a petition to revoke will not stay
the transaction.
Dated:
By the Board.
[Insert name],
Director, Office of Proceedings.
The following key identifies the information symbolized in the summary.
(1) Name of the tenant railroad.
(2) Name of the landlord railroad.
(3) If an agreement has been entered use
‘‘has agreed’’, but if an agreement has been
reached but not entered use ‘‘will agree.’’
(4) Indicate whether ‘‘overhead’’ or ‘‘local’’
trackage rights are involved.
(5) Describe the trackage rights.
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§ 1180.4
49 CFR Ch. X (10–1–11 Edition)
(6) State the date the trackage rights
agreement is proposed to be consummated.
(ii) To qualify for an exemption
under § 1180.2(d)(8) (acquisition of temporary trackage rights), in addition to
the notice, the railroad must file a caption summary suitable for publication
in the FEDERAL REGISTER. The caption
summary must be in the following
form:
Surface Transportation Board
Notice of Exemption
STB Finance Docket No.
(1)—Temporary Trackage Rights—(2)
(2) (3) to grant overhead temporary trackage rights to (1) between (4). The temporary
trackage rights will be effective on (5). The
authorization will expire on (6).
This notice is filed under § 1180.2(d)(8). Petitions to revoke the exemption under 49
U.S.C. 10502(d) may be filed at any time. The
filing of a petition to revoke will not stay
the transaction.
Dated:
By the Board.
[Insert name]
Director, Office of Proceedings.
The following key identifies the information symbolized in the summary.
(1) Name of the tenant railroad.
(2) Name of the landlord railroad.
(3) If an agreement has been entered use
‘‘has agreed,’’ but if an agreement has been
reached but not entered use ‘‘will agree.’’
(4) Describe the temporary trackage rights.
(5) State the date the temporary trackage
rights agreement is proposed to be consummated.
(6) State the date the authorization will
expire (not to exceed 1 year from the date
the trackage rights will become effective).
(3) Some transactions may be subject
to environmental review pursuant to
the Board’s environmental rules at 49
CFR part 1105.
(4) Transactions imposing interchange
commitments. (i) If a proposed acquisition or operation of a rail line involves
a provision or agreement that may
limit future interchange with a thirdparty connecting carrier, whether by
outright prohibition, per-car penalty,
adjustment in the purchase price or
rental, positive economic inducement,
or other means (‘‘interchange commitment’’), the following additional information must be provided:
(A) The existence of that provision or
agreement and identification of the affected interchange points; and
(B) A confidential, complete version
of the document(s) containing or addressing that provision or agreement,
which may be filed with the Board
under 49 CFR 1104.14(a) and will be kept
confidential without need for the filing
of an accompanying motion for a protective order under 49 CFR 1104.14(b).
(ii) To obtain information about an
interchange commitment for use in a
proceeding before the Board, a shipper
or other affected party may be granted
access to the confidential documents
filed pursuant to § 1180.4(g)(4)(i) of this
section by filing, and serving upon the
petitioner, a ‘‘Motion for Access to
Confidential Documents,’’ containing:
(A) An explanation of the party’s
need for the information; and
(B) An appropriate draft protective
order
and
confidentiality
undertaking(s) that will ensure that the documents are kept confidential.
(iii) Deadlines. (A) Replies to a Motion for Access are due within 5 days
after the motion is filed.
(B) The Board will rule on a Motion
for Access within 30 days after the motion is filed.
(C) Parties must produce the relevant
documents within 5 days of receipt of a
Board approved, signed confidentiality
agreement.
(h) Official notice. In connection with
any application or request for relief
under these procedures, the Board may
take official notice of any or all of the
following information. These data will
be presumed valid unless discredited by
any party. A party relying on information to be noticed officially shall list
the information. Upon request, the
party shall make the official notice
material available. Any party is free to
challenge the relevance or application
of any such data, or the weight that
should be accorded it.
(1) Annual STB Form R–1 Reports
submitted by rail carriers.
(2) Quarterly Commodity Statistics
submitted by rail carriers.
(3) STB Monthly Labor Statistics.
(4) Quarterly Financial Statements
of Rail Carriers.
(5) All other reports submitted to the
STB under oath.
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Surface Transportation Board, DOT
§ 1180.6
(6) Annual 1-percent Waybill Sample.
(7) Federal Reserve Board Production
Statistics.
(8) AAR compilations of bad order ratios, equipment ownership and repair
statistics, and freight car order figures.
[47 FR 9844, Mar. 8, 1982]
EDITORIAL NOTE: For FEDERAL REGISTER citations affecting § 1180.4, see the List of CFR
Sections Affected, which appears in the
Finding Aids section of the printed volume
and at www.fdsys.gov.
§ 1180.5
[Reserved]
§ 1180.6 Supporting information.
(a) All applications filed under 49
U.S.C. 11323 shall show in the title the
names of the applicants and the nature
of the proposed transaction. Beneath
the title indicate the name, title, business address, and telephone number of
the person(s) to whom correspondence
with respect to the application should
be addressed. The following information shall be included in all applications:
(1) A description of the proposed
transaction, including appropriate references to any supporting exhibits and
statements contained in the application and discussing the following:
(i) A brief summary of the proposed
transaction, the name of applicants,
their business address, telephone number, and the name of the counsel to
whom questions regarding the transaction can be addressed.
(ii) The proposed time schedule for
consummation of the proposed transaction.
(iii) The purpose sought to be accomplished by the proposed transaction,
e.g., operating economies, eliminating
excess facilities, improving service, or
improving the financial viability of the
applicants.
(iv) The nature and amount of any
new securities or other financial arrangements.
(2) A detailed discussion of the public
interest justifications in support of the
application, indicating how the proposed transaction is consistent with
the public interest, with particular regard to the relevant statutory criteria,
including
(i) The effect of the transaction on
inter- and intramodal competition, in-
cluding a description of the relevant
markets (see § 1180.7). Include a discussion of whether, as a result of the
transaction, there is likely to be any
lessening of competition, creation of a
monopoly, or restraint of trade in
freight surface transportation in any
region of the United States.
(ii) The financial consideration involved in the proposed transaction, and
any economies, to be effected in operations, and any increase in traffic, revenues, earnings available for fixed
charges, and net earnings, expected to
result from the consummation of the
proposed transaction.
(iii) The effect of the increase, if any,
of total fixed charges resulting from
the proposed transaction.
(iv) The effect of the proposed transaction upon the adequacy of transportation service to the public, as measured by the continuation of essential
transportation services by applicants
and other carriers.
(v) The effect of the proposed transaction upon applicant carriers’ employees (by class or craft), the geographic
points where the impact will occur, the
time frame of the impact (for at least
3 years after consolidation), and whether any employee protection agreements
have been reached.
(vi) The effect of inclusion (or lack of
inclusion) in the proposed transaction
of other railroads in the territory,
under 49 U.S.C. 11324.
(3) Any other supporting or descriptive statements applicants deem material.
(4) An opinion of applicants’ counsel
that the transaction meets the requirements of the law and will be legally authorized and valid, if approved by the
Board. This should include specific references to any pertinent provisions of
applicants’ bylaws or charter or articles of incorporation. 2
(5) A list of the State(s) in which any
part of the property of each applicant
carrier is situated.
(6) Map (exhibit 1). Submit a general
or key map indicating clearly, in separate colors or otherwise, the line(s) of
2 An opinion of counsel is not required in a
control transaction for the party sought to
be controlled, or in a responsive application
for the party against whom relief is sought.
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§ 1180.6
49 CFR Ch. X (10–1–11 Edition)
applicant carriers in their true relations to each other, short line connections, other rail lines in the territory,
and the principal geographic points in
the region traversed. If a geographically limited transaction is proposed, a
map detailing the transaction should
also be included. In addition to the
map accompanying each application, 20
unbound copies of the map shall be
filed with the Board.
(7) Explanation of the transaction.
(i) Describe the nature of the transaction (e.g., merger, control, purchase,
trackage rights), the significant terms
and conditions, and the consideration
to be paid (monetary or otherwise).
(ii) Agreement (exhibit 2). Submit a
copy of any contract or other written
instrument entered into, or proposed to
be entered into, pertaining to the proposed transaction. 3 In addition, parties
to exempt trackage rights agreements
and renewal of agreements described at
§ 1180.2(d)(7) must submit one copy of
the executed agreement or renewal
agreement with the notice of exemption, or within 10 days of the date that
the agreement is executed, whichever
is later.
(iii) If a consolidation or merger is
proposed, indicate: (A) The name of the
company resulting from the consolidation or merger; (B) the State or territory under the laws of which the consolidated company is to be formed or
the merged company is to file its certificate of amendment; (C) the capitalization proposed for the resulting company; and (D) the amount and character of capital stock and other securities to be issued.
(iv) Court order (exhibit 3). If a trustee, receiver, assignee, or personal representative of the real party in interest
is an applicant, submit a certified copy
of the order, if any, of the court having
jurisdiction, authorizing the contemplated action.
(v) State whether the property involved in the proposed transaction includes all the property of the applicant
carriers and, if not, describe what prop3 A final signed contract or agreement need
not be filed with a responsive application.
However, a draft contract or agreement
should be submitted containing the significant terms proposed.
erty is included in the proposed transaction.
(vi) Briefly describe the principal
routes and termini of the lines involved, the principal points of interchange on the routes, and the amount
of main-line mileage and branch line
mileage involved.
(vii) State whether any governmental
financial assistance is involved in the
proposed transaction and, if so, the
form, amount, source, and application
of such financial assistance.
(8) Environmental data (exhibit 4).
Submit information and data with respect to environmental matters prepared in accordance with 49 CFR part
1105. In major and significant transaction, applicants shall, as soon as possible, and no later than the filing of a
notice of intent, consult with the
Board’s Section of Environmental
Analysis for the proper format of the
environmental report.
(b) In a major transaction, submit the
following information:
(1) Form 10–K (exhibit 6). Submit: The
most recent filing with the Securities
and Exchange Commission (SEC) under
17 CFR 249.310 made within the year
prior to the filing of the application by
each applicant or by any entity that is
in control of an applicant. These shall
not be incorporated by reference, and
shall be updated with any Form 10–K
subsequently filed with the SEC during
the pendency of the proceeding.
(2) Form S–4 (exhibit 7). Submit: The
most recent filing with the SEC under
17 CFR 239.25 made within the year
prior to the filing of the application by
each applicant or by any entity that is
in control of an applicant. These shall
not be incorporated by reference, and
shall be updated with any Form S–4
subsequently filed with the SEC during
the pendency of the proceeding.
(3) Change in control (exhibit 8). If an
applicant carrier submits an annual report Form R–1, indicate any change in
ownership or control of that applicant
carrier not indicated in its most recent
Form R–1, and provide a list of the
principal six officers of that applicant
carrier and of any related applicant,
and also of their majority-owned rail
carrier subsidiaries. If any applicant
carrier does not submit an annual report Form R–1, list all officers of that
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Surface Transportation Board, DOT
§ 1180.6
applicant carrier, and identify the person(s) or entity/entities in control of
that applicant carrier and all owners of
10% or more of the equity of that applicant carrier.
(4) Annual reports (exhibit 9). Submit:
The two most recent annual reports to
stockholders by each applicant, or by
any entity that is in control of an applicant, made within 2 years of the
date of filing of the application. These
shall not be incorporated by reference,
and shall be updated with any annual
or quarterly report to stockholders
issued during the pendency of the proceeding.
(5) Issues (exhibit 10). Submit a discussion of any other issues relevant to
the transaction.
(6) Corporate chart (exhibit 11). Submit
a corporate chart indicating all relationships between applicant carriers
and all affiliates and subsidiaries and
also companies controlling applicant
carriers directly, indirectly or through
another entity (with each chart indicating the percentage ownership of
every company on the chart by any
other company on the chart). For each
company: include a statement indicating whether that company is a noncarrier or a carrier; and identify every
officer and/or director of that company
who is also an officer and/or director of
any other company that is part of a
different corporate family that includes a rail carrier. Such information
may be referenced through notes to the
chart.
(7) If applicant is not a carrier, indicate (i) the type of business in which it
is engaged, (ii) the length of time so
engaged, and (iii) its present and prospective activities which have or may
have a relation to transportation subject to 49 U.S.C. Subtitle IV.
(8) Intercorporate or financial relationships. Indicate whether there are any
direct or indirect intercorporate or financial relationships at the time the
application is filed, not disclosed elsewhere in the application, through holding companies, ownership of securities,
or otherwise, in which applicants or
their affiliates own or control more
than 5% of the stock of a non-affiliated
carrier, including those relationships
in which a group affiliated with applicants owns more than 5% of the stock
of such a carrier. Indicate the nature
and extent of any such relationships,
and, if an applicant owns securities of
a carrier subject to 49 U.S.C. Subtitle
IV, provide the carrier’s name, a description of securities, the par value of
each class of securities held, and the
applicant’s percentage of total ownership. For purposes of this paragraph,
‘‘affiliates’’ has the same meaning as
‘‘affiliated companies’’ in Definition 5
of the Uniform System of Accounts (49
CFR part 1201, subpart A).
(9) Employee impact exhibit. The effect
of the proposed transaction upon applicant carriers’ employees (by class or
craft), the geographic points where the
impacts would occur, the time frame of
the impacts (for at least 3 years after
consolidation), and whether any employee protection agreements have
been reached. This information (except
with respect to employee protection
agreements) may be set forth in the
following format:
EFFECTS ON APPLICANT CARRIERS’ EMPLOYEES
Current Location .................................
Jobs Classification ..............................
Jobs Transferred to ............................
Jobs Abolished ...................................
Jobs Created ......................................
Year ....................................................
..........
..........
..........
..........
..........
..........
(10) Conditions to mitigate and offset
merger-related harms. Applicants are expected to propose measures to mitigate
and offset merger-related harms. These
conditions should not simply preserve,
but also enhance, competition.
(i) Applicants must explain how they
would preserve competitive options for
shippers and for Class II and III rail
carriers. At a minimum, applicants
must explain how they would preserve
the use of major existing gateways, the
potential for build-outs or build-ins,
and the opportunity to enter into contracts for one segment of a movement
as a means of gaining the right separately to pursue rate relief for the remainder of the movement.
(ii) Applicants should explain how
the transaction and conditions they
propose would enhance competition
and improve service.
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§ 1180.7
49 CFR Ch. X (10–1–11 Edition)
(11) Calculating public benefits. Applicants must enumerate and, where possible, quantify the net public benefits
their merger would generate (if approved). In making this estimate, applicants should identify the benefits
that would arise from service improvements, enhanced competition, cost savings, and other merger-related public
interest benefits, and should discuss
whether the particular benefits they
are relying upon could be achieved
short of merger. Applicants must also
identify, discuss, and, where possible,
quantify the likely negative effects approval would entail, such as losses of
competition, potential for service disruption, and other merger-related
harms. In addition, applicants must
suggest additional measures that the
Board might take if it approves the application and the anticipated public
benefits identified by applicants fail to
materialize in a timely manner.
(12) Downstream merger applications.
(i) Applicants should anticipate whether additional Class I mergers are likely
to be proposed in response to their own
proposal and explain how, taken together, these mergers, if approved,
could affect the eventual structure of
the industry and the public interest.
(ii) Applicants are expected to discuss whether any conditions imposed
on an approval of their proposed merger would have to be altered, or any new
conditions imposed, if the Board should
approve additional future rail mergers.
(13) Purpose of the proposed transaction. The purpose sought to be accomplished by the proposed transaction, such as improving service, enhancing competition, strengthening
the nation’s transportation infrastructure, creating operating economies,
and ensuring financial viability.
(c) In a significant transaction, submit the information specified in paragraphs (b)(3), (b)(5), (b)(6), (b)(7), and
(b)(8) of this section.
[47 FR 9844, Mar. 8, 1982. Redesignated at 47
FR 49592, Nov. 1, 1982, and amended at 50 FR
15751, Apr. 22, 1985; 56 FR 41806, Aug. 3, 1991;
57 FR 28641, June 26, 1992; 58 FR 63104, Nov.
30, 1993; 62 FR 9717, Mar. 4, 1997; 64 FR 53269,
Oct. 1, 1999; 66 FR 32587, June 15, 2001]
§ 1180.7
Market analyses.
(a) For major and significant transactions, applicants shall submit impact
analyses (exhibit 12) describing the impacts of the proposed transaction—
both adverse and beneficial—on interand intramodal competition with respect to freight surface transportation
in the regions affected and on the provision of essential services by applicants and other carriers. An impact
analysis should include underlying
data, a study of the implications of
those data, and a description of the resulting likely effects of the proposed
transaction on the transportation alternatives that would be available to
the shipping public. Each aspect of the
analysis should specifically address
significant impacts as they relate to
the applicable statutory criteria (49
U.S.C. 11324(b) or (d)), essential services, and competition. Applicants must
identify and address relevant markets
and issues, and provide additional information as requested by the Board on
markets and issues that warrant further study. Applicants (and any other
party submitting analyses) must demonstrate both the relevance of the markets and issues analyzed and the validity of their methodology. All underlying assumptions must be clearly
stated. Analyses should reflect the consolidated company’s marketing plan
and existing and potential competitive
alternatives
(interas
well
as
intramodal). They can address: city
pairs, interregional movements, movements through a point, or other factors; a particular commodity, group of
commodities, or other commodity factor that would be significantly affected
by the transaction; or other effects of
the transaction (such as on a particular type of service offered).
(b) For major transactions, applicants
shall submit ‘‘full system’’ impact
analyses (incorporating any operations
in Canada or Mexico) from which they
must demonstrate the impacts of the
transaction—both adverse and beneficial—on competition within regions
of the United States and this nation as
a
whole
(including
interand
intramodal competition, product competition, and geographic competition)
and the provision of essential services
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Surface Transportation Board, DOT
§ 1180.8
(including freight, passenger, and commuter) by applicants and other network links (including Class II and Class
III rail carriers and ports). Applicants’
impact analyses must at least provide
the following types of information:
(1) The anticipated effects of the
transaction on traffic patterns, market
concentrations, and/or transportation
alternatives available to the shipping
public. Consistent with § 1180.6(b)(10),
these would incorporate a detailed examination of any competition-enhancing aspects of the transaction and of
the specific measures proposed by applicants to preserve existing levels of
competition and essential services;
(2) Actual and projected market
shares of originated and terminated
traffic by railroad for each major point
on the combined system. Applicants
may define points as individual stations or as larger areas (such as Bureau
of Economic Analysis statistical areas
or U.S. Department of Agriculture
Crop Reporting Districts) as relevant
and indicate the extent of switching
access and availability of terminal belt
railroads. Applicants should list points
where the number of serving railroads
would drop from two to one and from
three to two, respectively, as a result
of the proposed transaction (both before and after applying proposed remedies for competitive harm);
(3) Actual and projected market
shares of revenues and traffic volumes
for major interregional or corridor
flows by major commodity group. Origin/destination areas should be defined
at relevant levels of aggregation for
the commodity group in question. The
data should be broken down by mode
and (for the railroad portion) by singleline and interline routings (showing
gateways used);
(4) For each major commodity group,
an analysis of traffic flows indicating
patterns of geographic competition or
product competition across different
railroad systems, showing actual and
projected revenues and traffic volumes;
(5) Maps and other graphic displays
where helpful in illustrating the analyses in this section;
(6) An explicit delineation of the projected impacts of the transaction on
the ability of various network links
(including Class II and Class III rail
carriers and ports) to participate in the
competitive process and to sustain essential services; and
(7) Supporting data for the analyses
in this section, such as the basis for
projections of changes in traffic patterns, including shipper surveys and
econometric or other statistical analyses. If not made part of the application, applicants shall make these data
available in a repository for inspection
by other parties or otherwise supply
these data on request, for example,
electronically. Access to confidential
information will be subject to protective order. For information drawn from
publicly available published sources,
detailed citations will suffice.
(8) If necessary, an explanation as to
how the lack of reliable and consistent
data has limited applicants’ ability to
satisfy any of the requirements in this
paragraph (b).
(c) For significant transactions, specific regulations on impact analyses
are not provided so that the parties
will have the greatest leeway to develop the best evidence on the impacts
of each individual transaction. As a
general guideline, applicants shall provide supporting data that may (but
need not) include: current and projected traffic flows; data underlying
sales forecasts or marketing goals;
interchange data; market share analysis; and/or shipper surveys. It is important to note that these types of studies are
neither limiting nor all-inclusive. The
parties must provide supporting data,
but are free to choose the type(s) and
format. If not made part of the application, applicants shall make these data
available in a repository for inspection
by other parties or otherwise supply
these data on request, for example,
electronically. Access to confidential
information will be subject to protective order. For information drawn from
publicly available published sources,
detailed citations will suffice.
[66 FR 32588, June 15, 2001]
§ 1180.8 Operational data.
(a) Applications for major transactions must include a full-system operating plan—incorporating any prospective operations in Canada and Mexico—from which they must demonstrate how the proposed transaction
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§ 1180.8
49 CFR Ch. X (10–1–11 Edition)
would affect operations within regions
of the United States and on a nationwide basis. As part of the environmental review process, applicants shall
submit:
(1) A Safety Integration Plan, prepared in consultation with the Federal
Railroad Administration, to ensure
that safe operations would be maintained throughout the merger implementation process.
(2) Information on what measures
they plan to take to address potentially blocked crossings as a result of
merger-related changes in operations
or increases in rail traffic.
(b) For major and significant transactions: Operating plan (exhibit 13).
Submit a summary of the proposed operating plan changes, based on the impact analyses, that will result from the
transaction, and their anticipated timing, allowing for any time required to
complete rehabilitation, upgrading,
yard construction, or other major operational changes following consummation of the proposed transaction. The
plan should make clear the gains in
service, operating efficiencies, and
other benefits anticipated from the
merger. The plan should include:
(1) The patterns of service on the
properties, including the proposed principal routes, proposed consolidations of
main-line operations, and the anticipated traffic density and general categories of traffic (including numbers of
trains) on all main and secondary lines
in the system. Identify all yards expected to have an increase in activity
greater than 20 percent. Changes in operations may be summarized in a pro
forma density chart.
(2) If commuter or other passenger
services are operated over the lines of
applicant carriers, detail any impacts
anticipated on such services, including
delays which may be occasioned because a line is scheduled to handle increased traffic due to route consolidations.
(3) The anticipated equipment requirements of the proposed system, including locomotives, rolling stock by
type, and maintenance-of-way equipment; plans for acquisition and retirement of equipment; projected improvements in equipment utilization and
their relation to operating changes;
and how these will lead to the financial
and service benefits described in the
summary.
(4) A description of the effect of any
deferred maintenance or delayed capital improvements on any road or
equipment properties involved, the
schedule for eliminating such deferrals,
details of general system rehabilitation including rehabilitation relating
to the transaction (including proposed
yard and terminal modifications), and
how these activities will lead to the
service improvements or operating
economies anticipated from the transaction.
(5) Density charts (exhibit 14). Gross
ton-mile traffic density charts shall be
filed for applicant carriers containing a
map geographically showing those
lines handling 1 million gross ton-miles
per mile road or more per year and respective densities, expressed in gross
ton-miles per year, in each direction,
in segments of such lines between
major freight yards and terminals, including major intramodal and intermodal interchange points, using the
corporate or political subdivision name
of the points shown as well as the railroad station name. The mileage of each
segment of line shall be provided, and
should be shown on the chart. Data
shown in the density chart shall be for
the latest available full calendar year
preceding the filing of the application.
At applicants’ option data may be
shown on the density chart or an explanatory list.
(c) For minor transactions: Operating
plan-minor (exhibit 15). Discuss any
significant changes in patterns or
types of service as reflected by the operating plan expected to be used after
consummation of the transaction.
Where relevant, submit information related to the following:
(1) Traffic level density on lines proposed for joint operations.
(2) Impacts on commuter or other
passenger service operated over a line
which is to be downgraded, eliminated,
or operated on a consolidated basis.
(3) Operating economies, which include, but are not limited to, estimated
savings.
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Surface Transportation Board, DOT
§ 1180.9
(4) Any anticipated discontinuances
or abandonments.
[47 FR 9844, Mar. 8, 1982. Redesignated at 47
FR 49592, Nov. 1, 1982, as amended at 66 FR
32589, June 15, 2001]
§ 1180.9
Financial information.
The following information shall be
provided for major transactions, and for
carriers shall conform to the Board’s
Uniform System of Accounts, 49 CFR
part 1201:
(a) Pro forma balance sheet (exhibit
16). Where the transaction involves a
proceeding other than a control, a pro
forma balance sheet statement giving
effect to the proposed transaction commencing for the first year of the Impact Analysis in exhibit 12. The data
shall be presented in columnar form
showing:
(1) In the first column, the balance
sheet of transferee on a corporate entity basis,
(2) In the second column, a balance
sheet of transferor, on a corporate entity basis,
(3) In the third column, pro forma adjustments and eliminations; and
(4) In the fourth column, transferee’s
balance
sheet
giving
effect
to
consumation of the proposed transaction. 4
Each adjustment and elimination shall
be properly footnoted and fully explained. A pro forma balance sheet shall
be submitted for the number of years following consummation necessary to effect
the operating plan.
4 Where the purchase of a line or line segment is involved, a procedure utilizing three
columns should be followed. The first column
should show transferee’s actual balance
sheet on a corporate entity basis for the latest available 12-month period, the second column should show the adjustments necessitated by the purchase, and the third is a
compilation of the first two columns into a
pro forma balance sheet.
The transferor shall file a balance sheet
similar to the one filed by the transferee,
with the second column reflecting the adjustments resulting from the sale.
If the parent company (if any) of the transferee or transferor is affected, a similar balance sheet shall be filed for each.
All adjustments to these balance sheets
shall be supported in footnotes to the appropriate balance sheet.
(b) Pro forma income statement (exhibit 17). Where the transaction involves a proceeding other than a control, submit a pro forma income statement showing transferee’s estimate of
revenues, expenses, and net income for
at least each of the 3 years following
consummation of the transaction. 5 The
pro forma data shall be presented in columnar form, showing
(1) in the first column, transferee’s
actual income statement on a corporate entity basis for the year indicated in the impact analysis in exhibit
12;
(2) in the second column, a similar income statement for the transferor;
(3) in the third column, forecasted adjustments to the combined revenues,
expenses, and net income to reflect increases or decreases anticipated under
the unified operations, and
(4) in the fourth column, a compilation of the first three columns into a
pro forma income statement. 6
The adjustments are to be supported by
a statement explaining the basis used
in determining the estimated changes
in revenues, expenses, and net income
appearing in the third column. Additionally, if the major financial advantages to be derived from the proposed
transaction will not occur within 3
years after consummation, then applicant shall furnish additional information to reflect the number of years
5 If the operating plan requires more than 3
years to be put into effect, the pro forma income statement shall be prepared for as
many years as necessary to implement fully
the operating plan.
6 Where the purchase of a line or line segment is involved, a procedure utilizing three
columns should be followed. The first column
should show transferee’s actual income
statement on a corporate entity basis for the
latest available 12-month period, the second
column should show the adjustment necessitated by the purchase, and the third column is a compilation of the first two columns into a pro forma income statement.
The transferor shall file an income statement similar to the one filed by the transferee, with the second column reflecting the
adjustments resulting from the sale.
If the parent company (if any) of the transferor or transferee is affected, a similar
statement shall be filed for each.
All adjustments to these income statements shall be supported in footnotes to the
appropriate income statements.
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§ 1180.10
49 CFR Ch. X (10–1–11 Edition)
within which the financial advantages
will be realized. The basis for all such
data furnished shall be fully explained
and supported.
(c) Sources and application of funds
(exhibit 18). Transferor’s and transferee’s statement of sources and application of funds for the current year,
and a forecast 7 of sources and application of funds for each carrier (if a
merger or consolidation, the surviving
or resulting corporation) for the year
following consummation of the proposed transaction, and the years necessary to effectuate the operating
plan. 8 The form and content of these
statements should be constructed in
accordance with the schedule: ‘‘Statement of Changes in Financial Position’’ required in the most recently
filed Annual Report R–1 for Class I railroads.
(d) Property encumbrance (exhibit
19). If any of the property covered by
the application is encumbered and applicant has agreed to assume obligation or liability in respect thereof, submit:
(1) A description of the property encumbered.
(2) Amount of encumbrance and full
description thereof, including maturity, interest rate, and other terms and
conditions.
(3) Amount of encumbrance assumed
or to be assumed by applicant.
(e) The Board will incorporate by reference the current balance sheets and
income statements of Class I railroads
which are on file with the Board. Class
II and Class III railroads, and non-carrier entities shall submit balance
sheets (exhibit 20) and income statements (exhibit 21) covering a period
ending within 6 months before the application is filed.
[47 FR 9844, Mar. 8, 1982. Redesignated at 47
FR 49592, Nov. 1, 1982, and amended at 58 FR
63104, Nov. 30, 1993; 62 FR 9717, Mar. 4, 1997; 64
FR 53269, Oct. 1, 1999]
7 The forecast should reflect only changes
anticipated to result from the proposed
transaction. Forecasts are not required to
reflect general economic conditions unrelated to the proposed transaction.
8 The pro forma balance sheets (exhibit 16),
pro forma income statements (exhibit 17), and
sources and application of funds (exhibit 18)
shall cover the same years.
§ 1180.10
Service assurance plans.
For major transactions: Applicants
must submit a Service Assurance Plan,
which, in concert with the operating
plan requirements, identifies the precise steps to be taken by applicants to
ensure that projected service levels
would be attainable and that key elements of the operating plan would improve service. The plan shall describe
with reasonable precision how operating plan efficiencies would translate
into present and future benefits for the
shipping public. The plan must also describe any potential area of service
degradation that might result due to
operational changes and how instances
of degraded service might be mitigated.
Like the Operating Plan on which it is
based, the Service Assurance Plan
must be a full-system plan encompassing:
(a) Integration of operations. Based on
the operating plan, and using appropriate benchmarks, applicants must develop a Service Assurance Plan describing how the proposed transaction
would result in improved service levels
and how and where service might be degraded. This description should be a
precise route level review, but not a
shipper-by-shipper review. Nonetheless,
the plan should be sufficient for individual shippers to evaluate the projected improvements and changes, and
respond to the potential areas of service degradation for their customary
traffic routings. The plan should inform Class II and III railroads and
other connecting railroads of the operational changes or changes in service
terms that might affect their operations, including operations involving
major gateways.
(b) Coordination of freight and passenger operations. If Amtrak or commuter services are operated over the
lines of applicant carriers, applicants
must describe definitively how they
would continue to facilitate these operations so as to fulfill existing performance agreements for those services.
Whether or not the passenger services
are operated over lines of applicants or
applicants’ operations are on the lines
of passenger agencies, applicants must
establish operating protocols ensuring
effective communications with Amtrak
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Surface Transportation Board, DOT
§ 1180.10
and/or regional rail passenger operators to minimize any potential transaction-related negative impacts.
(c) Yard and terminal operations. The
operational fluidity of yards and terminals is key to the successful implementation of a transaction and effective
service to shippers. Applicants must
describe how the operations of principal classification yards and major
terminals would be changed or revised
and how these revisions would affect
service to customers. As part of this
analysis, applicants must furnish dwell
time benchmarks for each facility described in this paragraph, and estimate
what the expected dwell time would be
after the revised operations are implemented. Also required will be a discussion of on-time performance for the
principal yards and terminals in the
same terms as required for dwell time.
(d) Infrastructure improvements. Applicants must identify potential infrastructure impediments (using volume/
capacity line and terminal forecasts),
formulate solutions to those impediments, and develop time frames for resolution. Applicants must also develop a
capital improvement plan (to support
the operating plan) for timely funding
and completion of the improvements
critical to transition of operations.
They should also describe improvements related to future growth, and indicate the relationship of the improvements to service delivery.
(e) Information technology systems. Because the accurate and timely integration of applicants’ information systems
is vitally important to service, applicants must identify the process to be
used for systems integration and training of involved personnel. This must
include identification of the principal
operations-related systems, operating
areas affected, implementation schedules, the realtime operations data used
to test the systems, and pre-implementation training requirements needed to
achieve completion dates. If such systems will not be integrated and on line
prior to implementation of the transaction, applicants must describe the interim systems to be used and the adequacy of those systems to ensure service delivery.
(f) Customer service. To achieve and
maintain customer confidence in the
transaction and to ensure the successful integration and consolidation of existing customer service functions, applicants must identify their plans for
the staffing and training of personnel
within or supporting the customer
service centers. This discussion must
include specific information on the
planned steps to familiarize customers
with any new processes and procedures
that they may encounter in using the
consolidated systems and/or changes in
contact locations, telephone numbers,
or communication mode.
(g) Labor. Applicants must furnish a
plan for reaching necessary labor implementing agreements. Applicants
must also provide evidence that sufficient qualified employees would be
available at the proper locations to effect implementation.
(h) Training. Applicants must establish a plan for providing necessary
training to employees involved with
operations, train and engine service,
operating rules, dispatching, payroll
and timekeeping, field data entry, safety and hazardous material compliance,
and contractor support functions (e.g.,
crew van service), as well as training
for other employees in functions that
would be affected by the acquisition.
(i) Contingency plans for merger-related
service disruptions. To address potential
disruptions of service that could occur,
applicants must establish contingency
plans. Those plans, based upon available resources and traffic flows and
density, must identify potential areas
of disruption and the risk of occurrence. Applicants must provide evidence that contingency plans would be
in place to promptly restore adequate
service levels. Applicants must also
provide for the establishment of problem resolution teams and describe the
specific procedures to be utilized for
problem resolution.
(j) Timetable. Applicants must identify all major functional or system
changes/consolidations
that
would
occur and the time line for successful
completion.
(k)
Benchmarking.
Specific
benchmarking requirements may vary
with the transaction. The minimum for
benchmarking will be the 12 monthly
periods immediately preceding the filing date of the notice of intent to file
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§ 1180.11
49 CFR Ch. X (10–1–11 Edition)
the application. Benchmarking is intended to provide an historic monthly
baseline against which actual posttransaction levels of performance can
be measured. Benchmarking data
should be sufficiently detailed and encompassing to give a meaningful picture of operational performance for the
newly merged system. Applicants will
report in a matrix structure giving the
historic monthly (benchmark) data and
provide for the reporting of actual
monthly data during the monitoring
period. It is important that data reflect
uniformly constructed measures of historic and post-transaction operations.
Minimum benchmark data include:
(1) Corridor performance benchmarking.
Benchmarks will consist of route level
performance
information
including
flow data for traffic moving on the applicants’ systems. These data will encompass flows to and from major
points. A major point could be a Bureau of Economic Analysis (BEA) statistical area, or it can be a railroadcreated point based on an operational
grouping of stations or interchanges,
or it could be another similar construction. It will be necessary for applicants
to define traffic points used to establish benchmarks for purposes of monitoring. A sufficient number of corridor
flows must be reported so as to fully
represent system flows, including
interchanges with short lines and other
Class I’s, and internal traffic of the respective applicants before the transaction. In addition to identifying traffic flows by areas, they also must be
identified by commodity sector (for example, merchandise, intermodal, automotive, unit coal, unit grain etc.).
Data for each flow must include: traffic
volume in carloads (units), miles (area
to area), and elapsed time in hours.
Only loaded traffic need be included.
(2) Yard and terminal benchmarking—
(i) Terminal dwell. Terminal dwell for
major yards will be calculated in hours
for cars handled, not including runthrough and bypass trains or maintenance of way and bad order cars.
(ii) On time originations by major yard.
On time originations are based on the
departure of scheduled trains originating at a particular yard.
(3) System benchmarking. (i) Cars on
line.
(ii) Average train velocity, by train
type.
(iii) Locomotive fleet size and applicable bad order ratios.
(iv) Passenger train performance for
commuter and intercity passenger
services.
[66 FR 32589, June 15, 2001]
§ 1180.11 Transnational and other informational requirements.
(a) For applicants whose systems include operations in Canada or Mexico,
applicants must explain how cooperation with the Federal Railroad Administration would be maintained to address potential impacts on operations
within the United States of operations
or events elsewhere on their systems.
(b) All applicants must assess whether any restrictions or preferences under
foreign or domestic law or policies
could affect their commercial decisions, and discuss any ownership restrictions applicable to them.
[66 FR 32590, June 15, 2001]
Subpart B—Transfer or Operation
of Lines of Railroads in Reorganization
§ 1180.20 Procedures.
(a) Transactions under 11 U.S.C. 1172,
for the transfer or operation of lines of
bankrupt railroads under a plan of reorganization are governed by the following procedures:
(1) If the buyer or operator is not a
carrier, the Notice of Exemption procedures in subpart D of part 1150 of this
title.
(2) If the buyer or operator is a carrier, either:
(i) The application procedures in subpart A of this part; or,
(ii) The procedures in part 1121 of this
title for a petition to exempt the transaction from prior approval requirements of 49 U.S.C. 11323 et seq.
(b) The Board will establish or modify its existing procedures and deadlines as necessary in each proceeding
to comply with appropriate orders of
the Bankruptcy Court.
(c) Under 11 U.S.C. 1172(c)(1), the
Board is required to provide affected
employees with adequate protection.
The Board will impose the minimum
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Surface Transportation Board, DOT
§ 1182.2
levels required by 49 U.S.C. 11326, unless a need is shown for greater levels
of protection.
(d) All applications, notices, and petitions for exemption within the scope
of § 1180.20(a) shall advise the Board
that the proposed transaction involves
the transfer or operation of lines in reorganization.
[57 FR 57112, Dec. 3, 1992; 57 FR 61585, Dec. 28,
1992, as amended at 62 FR 9717, Mar. 4, 1997]
PART 1182—PURCHASE, MERGER,
AND CONTROL OF MOTOR PASSENGER CARRIERS
Sec.
1182.1 Applications covered by this part.
1182.2 Content of applications.
1182.3 Filing the application.
1182.4 Board review of the application.
1182.5 Comments.
1182.6 Processing an opposed application.
1182.7 Interim approval.
1182.8 Miscellaneous requirements.
1182.9 Notices of exemption.
AUTHORITY: 5 U.S.C. 559; 21 U.S.C. 853a; and
49 U.S.C. 13501, 13541(a), 13902(c), and 14303.
SOURCE: 63 FR 46397, Sept. 1, 1998, unless
otherwise noted.
§ 1182.1 Applications covered by this
part.
The rules in this part govern applications for authority under 49 U.S.C.
14303 to consolidate, merge, purchase,
lease, or contract to operate the properties or franchises of motor carriers of
passengers or to acquire control of
motor carriers of passengers. There is
no application form for these proceedings. Applicants shall file a pleading containing the information described in 49 CFR 1182.2. See 49 CFR
1002.2(f) (2) and (5) for filing fees.
§ 1182.2 Content of applications.
(a) The application must contain the
following information:
(1) Full name, address, and authorized signature of each of the parties to
the transaction;
(2) Copies or descriptions of the pertinent operating authorities of all of the
parties (NOTE: If an applicant is domiciled in Mexico or owned or controlled
by persons of that country, copies of
the actual operating authorities must
be submitted.);
(3) A description of the proposed
transaction;
(4) Identification of any motor passenger carriers affiliated with the parties, a brief description of their operations, and a summary of the intercorporate structure of the corporate family from top to bottom;
(5) A jurisdictional statement, under
49 U.S.C. 14303(g), that the 12-month aggregate gross operating revenues, including revenues of all motor carrier
parties and all motor carriers controlling, controlled by, or under common
control with any party from all transportation sources (whether interstate,
intrastate, foreign, regulated, or unregulated) exceeded $2 million. (NOTE:
The motor passenger carrier parties
and their motor passenger carrier affiliates may select a consecutive 12month period ending not more than 6
months before the date of the parties’
agreement covering the transaction.
They must, however, select the same
12-month period.)
(6) A statement indicating whether
the transaction will or will not significantly affect the quality of the human
environment and the conservation of
energy resources;
(7) Information to demonstrate that
the proposed transaction is consistent
with the public interest, including particularly: the effect of the proposed
transaction on the adequacy of transportation to the public; the total fixed
charges (e.g., interest) that result from
the proposed transaction; and the interest of carrier employees affected by
the proposed transaction. See 49 U.S.C.
14303(b);
(8) Certification by applicant of the
current U.S. Department of Transportation safety fitness rating of each
motor passenger carrier involved in the
transaction, whether that carrier is a
party to the transaction or is affiliated
with a party to the transaction;
(9) Certification by the party acquiring any operating rights through the
transaction that it has sufficient insurance coverage under 49 U.S.C. 13906 (a)
and (d) for the service it intends to provide;
(10) A statement indicating whether
any party acquiring any operating
rights through the transaction is either domiciled in Mexico or owned or
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| File Type | application/pdf |
| File Modified | 2011-12-16 |
| File Created | 2011-12-16 |