reason that the probable effect of the tariff in question would be difficult to ascertain within the 30 days allowed for gathering facts.

The proposal places the burden of proof upon the carrier filing the schedule, unless the complainant is also a carrier. It is not clear who would bear the burden when protestants include both carriers and other persons. The burden should be on the respondent carriers in all instances, since they usually have had the proposed change under consideration for some time, and data concerning whether the proposed rates are compensatory are largely within their knowledge. If the burden was otherwise, the Commission in most instances would be without an adequate record to make a proper determination. Necessary rate structures cannot be maintained if individual adjustments are handled in this manner. The Commission is not opposed to the greatest practical expedition in the disposition of suspension matters, but it believes that the proposed legislation will not contribute to this end (R. 267–268).

These comments also apply to the same changes proposed with respect to motor carrier rates (R. 276, 278), and to water carrier rates (R. 281).

NATIONAL COAL ASSOCIATION

(F. F. Estes)

There should be no change in the present law with respect to the suspension provisions. In the case of bona fide protests, the 3-month period would be wholly inadequate to allow proper preparation for the hearing, the introduction of testimony and evidence, argument, et cetera, and sufficient time for the Commission to fully consider the merits of the case. The present provision that accounts be kept with a view to possible refund is, when applied to a 3-month period, no saving clause for the coal industry. During the uncertain period, after 3 months, during which the new schedule would be contingently in effect, the coal protestant could lose markets never to be regained regardless of the final decision of the Commission (R. 873).

NATIONAL GRANGE

(Lloyd C. Halvorson)

The Grange favors an adequate staff for the Commission, so that when a new tariff is filed, the Commission can determine promptly and accurately whether or not, or to what extent, the new tariff will fall within the zone of lawfulness. The Commission should grant interim rate adjustments to the full extent to which their own data would clearly indicate a change to be lawful, with the more extended hearings to pertain to the area of doubt. The right of all interested parties to submit information helpful to the Commission in making the interim adjustment must be respected. Hasty approval of rates which may be excessive is opposed, even if refunds are provided for, because, in many cases, refunds would not reach those upon whom the incidents of the new rate impinged.

The burden of proof should always rest upon the carrier proposing a change, but the Commission should allow as much of a proposed rate change to go into effect as is reasonably certain to be within the limits of lawfulness, based on its own data and studies. The Commission

should maintain its power to suspend rates on its own initiative (R. 1334-1335).

NATIONAL INDUSTRIAL TRAFFIC LEAGUE

(William H. Ott)

The proposals with respect to the Commission's suspension power are not entirely supported. Some reduction in the suspension period should be made, but an absolute limit of 3 months is unrealistic; equitable disposal of the vast majority of such cases cannot be accomplished within that period. An initial period of 90 days with a proviso that the Commission may extend for an additional 90 days at the request of any party, is recommended.

The proposed standards for obtaining suspension are too strict, and would make suspension almost an impossibility. The present provisions seem to work reasonably well, and should be continued (R. 934-935).

NATIONAL LIVE STOCK PRODUCERS ASSOCIATION, AMERICAN NATIONAL CATTLEMEN'S ASSOCIATION, NATIONAL WOOL GROWERS' ASSOCIATION

(Lee J. Quasey)

The proposal to reduce the suspension period to 3 months would impose drastic requirements as a prerequisite to obtaining suspension of a tariff. To establish that a rate is probably unlawful and would result in injury, and that other available remedies are inadequate, within 18 days of the filing of the schedules, would be impossible to accomplish in many instances. This proposal is definitely against the public interest (R. 1815-1816).

NORTH DAKOTA PUBLIC SERVICE COMMISSION

(John M. Agrey)

The suspension period proposed under the new legislation is not of sufficient duration to permit the ICC to fully analyze and evaluate rate proposals. It would permit proposed rates to take effect before the ICC could pass on their reasonableness or unlawfulness (R. 795796).

OSCAR MAYER & CO., RATH PACKING CO., GEORGE A. HORMEL & CO., JOHN MORRELL & CO.

(Warren H. Wagner)

Carriers are required to keep detailed records of shipments made at rates which have gone into effect after the expiration of a suspension period, but before a Commission determination, for the purpose of refunding if the rates are ultimately found unlawful. To avoid this, carriers almost universally voluntarily postpone effective dates. Therefore, the change in the suspension period from 7 to 3 months is only a "paper" change and serves no purpose.

The proposal to require sworn complaints or affidavits to support suspensions, would work a dealine hardship on distant shippers (R. 1792).

PROPERTY OWNERS COMMITTEE

(William N. Maddox)

The committee is opposed to any change in the present suspension provisions of the act. As a practical matter, the Commission in many suspension proceedings would be unable to obtain sufficient evidence to decide an issue within 3 months, much less properly and carefully consider such evidence. The parties to such proceedings, particularly where the proposed changes affect large volumes of traffic cannot properly prepare and present evidence, briefs, etc., in time for the Commission to reach a mature decision within such a short time as 3 months. In fact, the present 7 months' period is not too long.

A reduction in the suspension period would most severely handicap and damage the shippers, particularly small shippers, who generally do not maintain traffic departments comparable to those maintained by the railroads (R. 1070-1071).

UNITED FRESH FRUIT AND VEGETABLE ASSOCIATION

(Durward Seals)

The proposed legislation shortening the suspension period to 3 months would deny protestants in rate proceedings ample oppor tunity to compile data to rebut the evidence of the proponents. Also under the restrictions proposed to be laid upon the discretionary sus pension power of the Commission, there is a serious question whether the public interest could be protected adequately (R. 1120–1121).

WATERWAYS FREIGHT BUREAU

(Harry C. Ames)

The power to temporarily suspend newly proposed rates or changes in rates pending an investigation as to their lawfulness, has been given to the Commission since 1910. The proposed changes seriously limit the power by theoretically leaving the existence of "probable cause" for suspension to the discretion of the Commission while spelling it out by a statement of specific standards, by shortening the period of suspension from 7 months to 3 months, and by transferring the burden of proof from the proponent in any case where the complainant or protestant is a carrier.

With respect to the specific standards for probable cause, it is a recognized theory that in statutes of this nature it is better to set forth standards in general terms leaving to the expert administrative agency the necessary elaboration to fit the actual and changing needs. The shortening of the period of suspension from 7 months to 3 months is ridiculous, since even the 120 days' period provided in the original act was found to be too short. Even though it may be a remedy to impound amounts sufficient to represent the difference in rates in the case of rate increases, it would be useless as far as water carriers are concerned with respect to rate reductions by the railroads. Concerning the shifting of the burden of proof, it is well settled that the burden is on the proponent of any proposition; he who advances a proposal should be prepared to justify it (R. 486–487).

WATERWAYS FREIGHT BUREAU

(W. Y. Wildman)

The proposals would require water carriers protesting reduced rail rates to establish that such rates are less than reasonable minimum. This is at least a costly and difficult task, and an impossible one where numerous points are involved. Moreover, variable factors militate against any accurate determination of out-of-pocket costs.

The reduction of the suspension period to 3 months will not speed up the decision of cases. Expedition in decision can only be accomplished by additional appropriations to permit the employment of more personnel at salaries which will insure their continued service in the Commission. The proposal would simply mean that suspended· rates will become effective before the ICC could pass on their propriety (R. 981-983).

Additional opponents

American Merchant Marine Institute, Inc., Alvin Shapiro (R. 1620). American Retail Federation, Richard Webber (R. 1091-1092). Atlanta Freight Bureau, C. B. Culpepper (R. 1236).

California Farm Research and Legislative Committee, Charles S. Gubser (Member of Congress), (R. 805).

California Grape & Fruit Tree League, E. Alan Mills (R. 1125). Contract Carrier Conference, Clarence D. Todd (R. 1280).

Fargo (North Dakota), Chamber of Commerce, J. I. Finsness (R. 1000).

Grand Rapids (Mich.), Chamber of Commerce, C. E. Elerick (R. 1718).

Inland Empire Waterways Association, Herbert G. West (R. 1707). National Council of Farmer Cooperatives (R. 1688).

National Retail Dry Goods Association, Robert H. Smith (R. 10061007).

North Atlantic Ports Conference, A. C. Welsh (R. 997).

Pacific American Steamship Association, Ralph B. Dewey (R. 1001).

Public Service Commission of Wisconsin, A. Wilford Larson (R. 518).

Upper Mississippi Waterway Association, Inc., A. C. Mills (R. 1615).

VII. VOLUME FREIGHT RATES

Provisions of Interstate Commerce Act

(None.)

Amendments proposed by H. R. 6141 and H. R. 6142

Section 8 of H. R. 6141 and H. R. 6142 would repeal section 15a of the Interstate Commerce Act (relating to the rule of ratemaking) and insert a section 15a (4) providing that unjust discrimination or undue preference or prejudice shall not be predicated on the establishment, maintenance, publication, and application of rates or charges for individual shipments of property subject to incentive minimum weights or in volume which make due allowance for differences in the handling

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costs of a carrier subject to the act and which are established for the purpose of meeting competition of other modes of transportation. Purposes of amendments

The purpose of the provisions is to provide specific statutory authorization for the establishment of volume rates under certain conditions.

Testimony

DEPARTMENT OF COMMERCE

(Sinclair Weeks, Secretary, Philip A. Ray, General Counsel)

By permitting volume and incentive rates, the Department seeks to recognize as a matter of law that which is true as a matter of economic fact, and which the Interstate Commerce Commission has already recognized. Because of basic equipment differences which exist in transportation, the large shipment has a choice not available to the small shipment. This often results in an advantage which is not necessarily equalized by restricting competition to forestall lower quantity rates where competition and cost savings dictate such lower charges. To a considerable extent the usefulness and lawfulness of volume rates has already been accepted. (See Molasses from New Orleans, La., to Peoria, 235 ICC 485 (p. 188).) Enactment of the provision dealing with volume and incentive rates would give statutory recognition to the practical situation which exists. Under this proposal actual competition would have to exist and any volume differential would have to be cost justified (p. 189). Under this recommendation on volume shipments there is simply an extension of the present practice to enable a railroad, for example, on a number of carloads, in one haul, to give a better rate than they might on one carload. It is a principle that is well established in business, to give quantity discounts. It has come into the transportation business to the extent of allowing different rates on carloads than on less than carloads.

This is not an unlimited right. There must be two ingredients present in order that there may be a differential in any multiple carlot. It would have to meet actual competition, and the rate would otherwise have to be lawful, compensatory, and so forth. Secondly, the difference would have to be cost justified to the carrier. This is substantially what is done under the Robinson-Patman Act. Quantity discounts are permitted but with insistence that they be cost related and no longer than necessary to meet competition (p. 229).

The provisions in section 15, paragraph (4), do not in any way alter the present doctrine of the ICC with respect to volume rates. Further experimentation in this field might be encouraged by the emphasis on increased competitive freedom in ratemaking as proposed in this legislation. For this reason, it was believed desirable to spell out the volume-rate doctrine in the legislation.

The language of the proposed statute provides appropriate safeguards against competitive abuses, and retains the present requirements that volume rates be cost justified and competitively compelled (R. 1747).