The U.S. Surface Transportation Board this week adopted a rule designed to streamline its approach to cases in which one or more parties is arguing market dominance led to an unreasonable rate.
In a news release, the STB said that market dominance cases can be costly and time-consuming, especially in smaller cases.
The rule adopted this week, which becomes effective Sept. 5, was initially proposed in September 2019 and lays out the factors
that could establish a prima facie showing of market dominance. Those include:
- The movement has a revenue-to-variable cost ratio of 180 percent or greater;
• The movement would exceed 500 highway miles between origin and destination;
• There is no intramodal competition from other railroads;
• There is no barge competition;
• There is no pipeline competition;
• The complainant has used trucks for 10 percent or less of its volume (by tonnage) subject to the rate at issue over a five-year period; and
• The complainant has no practice buildout alternative (regardless of transportation mode) due to physical, regulatory, financial or other issues.
The STB said complainants who provide evidence of one or more of these
would have the option to use the non-streamlined market dominance approach to prove market dominance.
Under either approach, defendant railroads would continue to have the opportunity to rebut a complainant’s evidence, they added.
The STB also announced that it would soon initiate a proceeding to further explore the adoption of various commodity-specific thresholds, including for chlorine and agricultural products.
Tags: STB decisions, STB rate cases, STB rulemaking, STB rules, STB rules making, U.S. Surface Transportation Board
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