formation which is necessary for a proper administration of the act (p. 1751).

The Department has great difficulty in understanding why it would be considered inappropriate for contract carriers to file and publish the rates which they actually charge.

There is no doubt about the contract carrier being a competitor of the common carrier. Nor should there be any doubts about the competition being conducted on an unequal and unfair basis so long as the common carrier is unable to determine what his competitor is charging. No extended discussion is necessary in order to see that the public interest will be served by giving the common carrier the opportunity to meet, if he can, the price competition of contract carriers (p. 1752).

B. STANDARDS

(Sinclair Weeks, Secretary)

The National Industrial Traffic League objected to the provisions which would require the Commission in prescribing a contract-carrier rate to determine that such rate would not give advantage or preference to the contract carrier in competition with any common carrier subject to the act.

The Contract Carrier Conference of the American Trucking Association also objected to the provision as being in conflict with the objective of the revised national transportation policy to encourage full competition and reduced economic regulation (p. 1752).

The Department agrees that the objections of the National Industrial Traffic League and the Contract Carrier Conference are meritorious.

Although it is the objective of the proposed legislation to provide. additional freedom of ratemaking to common carriers in order to furnish equality of opportunity to those who are dependent upon common carriers, it is not intended that determinations of the lawfulness of the minimum rates of contract carriers be based upon the rates, rules, regulations, or practices of common carriers.

It appears, therefore, that the provision should be modified so as to relieve the Commission of this obligation. The Department suggests language designed to accomplish this objective (p. 1753). [The Department of Commerce submitted an amendment relating to minimum rates for contract carriers by motor vehicle which struck out all on page 26 of the bills between the word "Such" in line 3 and the word "carriers" in line 11. A similar amendment relating to contract carriers by water was also submitted which struck out all on page 36 of the bills between the word "Such" in line 12 and the word "carriers" in line 20 (R. 1758-1759).]

Other proponents

ASSOCIATION OF AMERICAN RAILROADS

(J. Carter Fort)

The railroads concur with the views expressed by Mr. Philip A. Ray, General Counsel of the Department of Commerce, concerning the publication of rates or contracts by contract carriers (R. 572).

TRANSPORTATION ASSOCIATION OF AMERICA

(George P. Baker)

In the association's opinion, the making public of minimum rates does not give common carriers the information they are entitled to have as to the exact charges of their for-hire competitors, and hence we favor this proposal. Such a change in the law would not increase the jurisdiction of the regulatory agencies to regulate the level of contract carrier rates. Their power in this respect would remain limited to the prescription of minimum rates. Contract motor and water carriers should be required to file, adhere to, and make public the rates they actually charge (R. 356).

Additional proponents

Intercoastal Steamship Freight Association, Harry S. Brown (R. 1051-1052).

North Dakota Public Service Commission, John M. Agrey (R. 797). Opponents

A. FILING OF ACTUAL RATES

AMERICAN FARM BUREAU FEDERATION

(Matt Triggs)

The federation is opposed to the regulation of contract-carrier rates. It is impractical and fallacious to compare contract with corresponding common-carrier rates. Contract carriage is tailored to meet the specific needs of a shipper, and if those needs can be met more economically by contract carriers, there is no reason why the Commission should concern itself with such rates (R. 1226).

CONTRACT CARRIER CONFERENCE

(Clarence D. Todd)

The only reason which has been advanced for the proposal to require contract carriers to file their "rates or charges" instead of "minimum rates or charges actually maintained and charged," is that the contract carriers now have an opportunity to conceal their rates to the detriment of common-carrier competitors. However, under existing law, contract carriers are required to file minimum rates "actually maintained and charged." There are no hidden charges.

To permit motor contract carriers to file a copy of their actual contract for public inspection in lieu of a schedule, if the names of shippers are shown in connection therewith, would be a violation of section 222 (e) providing that it shall be unlawful for "any motor carrier" knowingly to disclose or permit to be acquired by any person other than the shipper or the consignee, any information concerning the nature, kind, quantity, destination, and so forth, of any property tendered or delivered to such carrier for transportation, which may improperly disclose his business transactions to a competitor (R. 1277-1278).

INTERSTATE COMMERCE COMMISSION

(Anthony F. Arpaia)

The proposed amendment to require motor contract carriers to publish and post rates actually maintained and charged, or in the alternative the actual contract or contracts is inconsistent with other provisions that the Commission shall not make public any such contracts or the terms thereof, except as a part of the record in a formal proceeding, and that make it unlawful for any motor carrier knowingly to disclose or permit to be acquired by any person other than the shipper or the consignee any information concerning the nature, kind, quantity, destination, and so forth, of any property tendered or delivered to such carrier for transportation, which may improperly disclose his business transactions to a competitor. Contract carriers do not have one set of rates. To identify different sets of rates as being for specified shippers would be inconsistent with the other provisions. It is our opinion that no departure is warranted from the present policy of affording to shippers secrecy regarding their business transactions to the greatest extent possible. Contract carriers presently are required to publish and file, in schedules open to public inspection, the minimum rates which they are actually charging. The schedules also list the names of shippers with whom the carrier has contracts, but this listing is not connected with any rates. If any competing carrier or shipper is of the opinion that the published minimum rates are below the level of reasonableness, they may challenge those rates in a complaint proceeding and the Commission may require them to be raised. If the proposal to permit the filing of actual contracts in lieu of schedules is adopted, there would have to be a modification of section 218 (c) which, both as now worded and as proposed to be worded, authorizes the Commission to suspend schedules but not contracts. The Commission does not favor the amendment proposed (R. 277-278).

Presently water contract carriers are required to publish schedules of minimum rates or charges only, and this is sufficient since they have the statutory duty only to observe reasonable minimum rates. The proposal would have them publish either the rates or the contracts in force, with the objective of full publicity. It would conflict with provisions in section 313 (b) and 307 (g), and the Commission is not in favor of its enactment (R. 280).

NATIONAL INDUSTRIAL TRAFFIC LEAGUE

(William H. Ott)

The league has previously approved the filing of schedules of minimum rates or charges actually maintained by contract carriers. The proposal would eliminate "minimum" and make the filing requirements now provided for common carriers apply also to contract operations. Such common-carrier requirements are entirely inappropriate for contract carriers. The requirements should be stated separately in language based upon the necessities of each type of operation (R. 937).

B. STANDARDS

CONTRACT CARRIER CONFERENCE

(Clarence D. Todd)

The conference is opposed to amending section 218 so as to make contract carriers subject to section 217 of the act. Such an amendment would give the Commission power to prescribe "nondiscriminatory rates and charges" for contract carriers. This would be inconsistent with the definition of a contract carrier and with the regulations which the Commission has imposed on such carriers. Every difference in rates does not constitute an unjust discrimination; such discrimination exists only when the transportation performed and the circumstances surrounding the transaction are substantially the same. If the service performed by contract carriers is to be a special and individual one as required by the new definition, then substantially the same service would be required by any other shipper. Therefore, by the very nature of the contract carrier's individual service, it would not be able to unjustly discriminate between shippers even though it might be charging different shippers different rates.

The concept of unjust discrimination, and that of contract carriage, are entirely inconsistent, because the prohibition against undue discrimination is designed to require carriers who serve the public to treat all shippers alike under the same or similar circumstances, whereas the law and regulations governing contract carriers are designed to limit the service offered to particular classes of shippers and receivers (R. 1278-1279).

Under the existing law only the provisions of part II of the act apply to contract carriers. The first amendment to section 218 (b) would make it necessary for the Commission, in prescribing a contract earrier rate, to give consideration to the rates of all forms of transportation subject to the jurisdiction of the Interstate Commerce Commission. Such requirement is not only unnecessary but it is in direct conflict with other provisions of the bill. There is little or no relationship between the rates charged by contract motor carriers and those charged by railroads, water carriers, and freight forwarders. It is in direct conflict with the national transportation policy, which declares that free enterprise, full competition, reduction of economic regulation, and the encouragement of fair and impartial regulation are all to be encouraged.

The change in the definition of a contract carrier would place such carriers in direct competition with private carriage and would practically eliminate the competition between common and contract carriers. If the contract carrier is to successfully compete with the pri vate carrier it must be in a position to institute rates which are competitive with the cost of private transportation, and the Commission in considering the reasonableness and lawfulness of such rates should be in a position to give consideration to the effect of prescribing a rate on the movement of the traffic by the contract carrier (R. 1279-1280).

INTERSTATE COMMERCE COMMISSION

(Anthony F. Arpaia)

The principal modification of the rule of ratemaking for motor contract carriers is the substitution of "this act" for "this part" in 218 (b). In some places, this is confusing. Only the provisions of part II, by their terms, are applicable to motor contract carriers, and to say that contract carrier rates shall not be in contravention of any provision of "this act," makes the intention unclear. This change has the effect of relating contract carrier rates not only to motor common carriers, but also to the rates of all other common carriers subject to the entire act, including freight forwarders.

Frequently motor contract carriers have been allowed minimum rates that are lower than the reasonable minimum rates for motor common carriers, since they are able to pick and choose the most desirable and profitable traffic. The imposition of a requirement that contract carriers charges shall not be less than those of motor common carriers for the same service, as imposed by some States, would remove the incentive to use motor contract carrier service because of lower rates, and properly tend to restrict the use of contract carriage to those instances in which a specialized and individualized service is required. It is recommended that the following be substituted in lieu of the second sentence of 218 (b), and that no further change be made in the subsection (R. 278):

No such minimum rates, fares, or charges which are lower than the rates, fares, or charges of competing common carriers subject to this Act, plus reasonable additional charges for any special services, privileges, or facilities furnished by the contract carrier by motor vehicle which are not furnished by the competing common carriers, shall be deemed to be reasonable unless the lower rate, fare, or charge of the contract carrier by motor vehicle will give no advantage or preference to such contract carrier in competition with any common carrier subject to this Act, will not prevent or endanger the maintenance of adequate and economical common carrier service, and otherwise will be consistent with the public interest and the national transportation policy declared in this Act.

The changes proposed in section 307 (h), relating to the prescription of minimum rates for water contract carriers would considerably broaden the scope by substituting "Act" for "part," and would remove the requirement that we consider the effect of rates upon the movement of traffic by such carriers. The effect would be to restrict the activities principally of the few tramp ship operators, and the Commission is not prepared to recommend this change (R. 281).

NATIONAL INDUSTRIAL TRAFFIC LEAGUE

(William H. Ott)

The effect of the proposed change in the rule of ratemaking for contract carriers seems to be to require the Commission to consider the effect of contract carrier rates upon those of any common carrier subject to the act. Rates should be based upon the cost and characteristics of each form and not in relation to rates charged by any other form, and this should apply to contract as well as common carriers (R. 937).