« PreviousContinue »
is intended to make unlawful so-called buy and sell activities. Under the primary business test used by the Commission and approved by the courts, buy and sell operations are illegal now. The proposed legal standard of lawfulness is capable of no more easy administrative interpretation than is the one presently used by the Commission. There is no need to modify the primary business test.
The present definition has been the subject of numerous cases before the Commission and the courts, and its meaning is definite and well understood. If it is changed, it will again be the subject of litigation and of uncertainty as to its exact meaning (R. 938–940).
NORTH DAKOTA PUBLIC SERVICE COMMISSION
(John M. Agrey)
The ICC under existing law has adequate power to stop illegitimate for-hire operations. Such illegal operations can be adequately controlled through the enforcement of the primary business test, provided that the ICC is granted additional appropriations which would permit enlargement of its field staff to investigate the numerous complaints. Constant rate increases and deterioration in common carrier service aided the growth of private transportation. The repeal of transportation taxes on freight and passenger travel would enable the common carriers to compete more effectively with private transportation, which does not pay the tax (R. 796-797).
PRIVATE CARRIER CONFERENCE, INC.
(Joseph E. Keller) The Private Carrier Conference, Inc., composed of 1,600 firms which operate private motor trucks in the furtherance of their business, and of private carrier members of State Trucking Associations, affiliated with the American Trucking Associations, Inc., unanimously opposes H. R. 6141 wholly, but specifically opposes the provisions which redefine a private carrier of property by motor vehicle.
It is apparent from a study of the proposed recommendations of the advisory committee that the purpose for the proposed change is to eliminate unregulated truckers operating under the guise of private carriers. This conference, however, believes that the recommendations are much broader in scope and meaning, and would affect the operations of all bona fide truckowners. The recommendations which call for a redefinition of private carriage would unquestionably nullify the "primary business" test established and applied in determining whether particular truck operations are for-hire or bona fide private earriage. Under the existing standards applied by the ICC and by the Federal courts, each case is determined upon its own particular facts, and neither the receipt of compensation for transportation nor the existence of some noncarrier business to which transportation is incidental, is conclusive. The ICC has adequate machinery to stop these "buy and sell" or gypsy operations, which the advisory committee report overlooks or discards.
As stated in an exchange of correspondence with the Chairman of the ICC, this conference offers its full support in attacking the problem, and believes that corrective measures should be taken to eliminate
this deception without resorting to legislation. It is believed that while the proposed recommendations on the surface appear to be directed toward the elimination of the gypsy operators, all bona fide private carrier operations would be adversely affected. In addition to upsetting the established "primary business principle, the advisory committe report suggested dropping the requirement that transportation must be for "furtherance of any commercial enterprise.” This would have the inadvertent effect of bringing even tourists and their baggage under the Commission's safety regulations.
The vital importance of common carriers as part of our national defense is recognized, but private carriers are equally essential to our Nation's defense and economy (R. 1708-1711).
PRIVATE TRUCK COUNCIL OF AMERICA, INC.
(James D. Mann) The provisions of the proposed legislation, with respect to private carriage of property by motor vehicle, along with the amendments recommended by the Interstate Commerce Commission, present a serious threat to the welfare of the operations of trucks in the regular course of nontransportation enterprise (R. 522).
It appears that the purpose of the proposed change in the term private carriage is to prohibit the so-called "buy and sell” operations, which amount to for-hire transportation. This problem appears to have been resolved satisfactorily by the application of the "primary business" test established by the Commission and the Faleral Courts in Brooks Transportation Company v. United States (93 Fed. Supp. 517, affirmed 340 U. S. 925). The test proposed by opponents of private carriage, that is, whether a person is operating “for compensation," was rejected. Under this test, “compensation” would include charges by sellers for delivery of their own products, or inclusion of allowances for delivery in setting prices, and differences in plant or delivered prices.
The present law is satisfactory. The problem of "buy and sell” operations can be curtailed and eliminated by policing. Any change in the existing law would create ambiguity which could lead to absurd results and further litigation (R. 528–524).
The Commission's recommendations are worse than the proposal in the bill itself. The recommendations would embrace the rejected "for compensation” test as part of a proposed new section 203 (c), which could embrace all truck operations, leaving none free for “private” operations. Both the proposed bill and the Commission's recommendations are renewed attacks upon the right of American industry to operate its own trucks in the bona fide course of its own business (R. 524-523). Additional opponents
American Merchant Marine Institute, Inc., Alvin Shapiro (R. 1619).
Burlington (Iowa) Shippers' Association, Inc., F. L. Partridge (R. 781).
('ar and Truck Renting & Leasing Association, IIoward Willett, Jr. (R. 1338).
Intercoastal Steamship Freight Association, Ilarry S. Brown (R. 1051).
J. D. Streett & Co., Inc., Kenneth C. Baker (R. 1605).
National Armored Car Association, Inc., Eugene E. Murphy (R. 1848).
National Coal Association, F. E. Estes (R. 874).
Pacific American Steamship Association, Ralph B. Dewey (R. 1001).
Private Truck Council of America, Inc., William Quinlan (R. 1341). United States Wholesale Grocers' Association, Inc., R. H. Rowe (R. 788).
Upper Mississippi Waterway Association, Inc., A. C. Mills (R. 1616).
IX. CONTRACT CARRIER RATES
A. FILING OF ACTUAL RATES
Provisions of Interstate Commerce Act
Sections 218 (a) and 306 (e) of the Interstate Commerce Act require, among other things, contract carriers by motor vehicle and contract carriers by water, respectively, to file with the Commission, publish, and keep open for public inspection, schedules containing the minimum rates or charges of such carriers actually maintained and charged for the transportation of passengers or property in interstate or foreign commerce, and any rates, regulations or practices affecting such rates or charges. Amendments proposed by H. R.6141 and H. R.6142
Sections 12 (a) and 16 of H. R. 6141 and H. R. 1642 would amend sections 218 (a) and 306 (e) of the act so as to require contract carriers by motor vehicle and contract carriers by water, respectively, to publish, file and post either the rates, fares, or charges which they actually maintain, or in the alternative, at their option, the contracts annually in force. Purpose of amendments
The purpose of the amendments is to require contract carriers by motor vehicle and by water to file and publish either the rates, fares, or charges which they actually maintain, or their transportation contracts.
B. STANDARDS Provisions of Interstate Commerce Act
Sections 218 (b) and 307 (h) of the Interstate Commerce Act authorize the Commission whenever it finds that any minimum rate or charge of any contract carrier by motor vehicle or by water, respectively, or any rule, regulation, or practice of any such carrier affecting such minimum rate or charge, or the value of the service thereunder, contravenes the national transportation policy declared in the act, or is in contravention of any of the provisions of parts II or III, to prescribe such just and reasonable minimum rate or charge, or such rule, regulation, or practice, as in its judgment may be necessary or desirable in the public interest and will not be in contravention
of any of the provisions of such parts. The minimum rate, charge, etc., prescribed by the Commission may not give any advantage or preference to a contract carrier by motor vehicle or by water which is inconsistent with the national transportation policy, and the Commission is required to give consideration to the cost of the services rendered by such carriers, and to the effect of such minimum rate, fare, charge, etc., upon the movement of traffic by such carriers. Amendments proposed by H. R.01.11 and H. R. 6142
Sections 12 (b) and 17 (f) of H. R. 6141 and H. R. 6142 would amend sections 218 (b) and 307 (h) of the act, respectively, so as to provide that the minimum rate, charge, etc., prescribed by the Commission may not give any advantage to a contract carrier by motor vehicle or by water in competition with common carriers by rail, by motor vehicle, by water, or freight forwarders which might be inconsistent with the act, and to require the Commission to give consideration to the cost of the services rendered by such contract carriers. The Commission would be relieved of the requirement to give consideration to the effect of the minimum rate, charge, etc., upon the movement of traffic by common carriers by motor vehicle or by water. Purpose of amendments
The purpose of the amendments is to require the Commission in prescribing a minimum rate for a contract carrier by motor vehicle or by water not only to give consideration to rates of common carriers by motor vehicle or by water, but also to the rates of all other common carriers subject to the act, including freight forwarders, and to relieve the Commission of the obligation of considering the effect of such rate on the movement of traffic by common carriers by motor vehicle or by water.
(NOTE.—The Department of Commerce suggested amendments in its testimony which modified provisions of the bills requiring the Commission to consider certain factors in prescribing minimum rates for contract carriers.) Testimony
DEPARTMENT OF COMMERCE
(Sinclair Weeks, Secretary, and Philip A. Ray, General Counsel)
A, FILING OF ACTUAL RATES
Unfair competition between common and contract carriers is accentuated by the fact that the act requires contract carriers to file only their minimum rates, which leaves the actual rate charged undisclosed. This is in direct contrast to the requirement that all common carrier rates be published. Contract carriers should be required to file actual charges rather than minimum charges as now required by the act (pp. 42, 43).
The purpose of the amendment made by section 12 (a) is to enable common carriers by motor vehicle to compete more effectively with contract carriers by motor vehicle who have greater flexibility in rates. Since contract carriers are required to file only minimum rates, the competing common carrier does not know what his contract carrier competitor is actually charging. This puts the common carrier at a distinct disadvantage in computing for the business both are seeking to capture (p. 196).
All that is required of a contract carrier filing a minimum rate is that such rate be actually maintained and charged for the traffic of at least one shipper. This leaves the contract carrier free to charge higher rates to other shippers and to pick and choose as it pleases among such shippers. If the competitive opportunity of common and contract carriers is to be put on a more realistic basis, the contract carrier's actual charges to shippers should be made public.
The ICC in its report to the committee opposed section 12 (a) principally for the reason that it would conflict with or be inconsistent with the provisions of section 220 (a) which permits the ICC to require filing of contracts but forbids their publication except as part of the record in a formal proceeding where such action would be consistent with the public interest and 222 (e) which forbids disclosure of business transactions to competitors of a shipper. The Department does not believe there would be any conflict with section 220 (a) because the ICC need publish only the actual rates and there would be no need for publication of the contracts. However, if the committee feels there is a conflict, this can be avoided by amending section 220 (a) (p. 197).
Neither does the Department believe that there would be any conflict with section 222 (e) but this too, if necessary, could be avoided by amending section 222 (e). The Department does not agree with the ICC view that the policy of affording the shippers' secrecy is nec. essary. It feels that this secrecy must be removed if common and contract carriers are to be placed on a truly competitive basis. The fact is that a competing carrier is harmed by rates above this minimum for these are the rates that are actually being charged to shippers. The competing carrier may not be able to meet the minimum rate actually charged to one shipper, but he may very well be able to meet rates charged to other shippers, if he knew what those rates were (p. 198).
The purpose of the amendment made by section 16 is to enable common carriers by water or other forms to compete more effectively with contract carriers by water. Contract carriers by water, just as contract carriers by motor vehicle, have greater flexibility in rates than their common-carrier competitors since they are only required to file their minimum rates. Common carriers by water are, therefore, in no better position to ascertain the actual rates charged by contract carriers. In view of this, there would not seem to be any logical reason why identical treatment should not be accorded contract carriers by motor and water insofar as the filing of rates "actually maintained and charged” is concerned.
Requiring contract carriers by water to file rates actually maintained and charged, or in the alternative the actual contracts covering the transportation, as proposed by section 16, would help stabilize the domestic water-carrier industry and equalize the opportunity to bid for competitive traffic.
The Department's discussion of the same question as to motorcontract carriers, is applicable here (p. 200).
The ICC itself has said in various decisions the minimum rates of contract carriers are, in fact, not rates at all in the common-carrier sense of the term” but are “simply a floor for the charges actually to be made." Under these circumstances, the Department does not understand why the ICC objects to being given authority to obtain in