32582 Federal Register / Vol. 66, No. 116 / Friday, June 15, 2001 / Rules and Regulations

solely for the reception of National

Oceanic & Atmospheric Administration

(‘‘NOAA’’) broadcast weather band

signals should continue to be exempt

from the scanning receiver definition.

The scanning receiver definition will be

modified to include the weather radio

exemption. We also note that scanning

receivers designed solely for the

reception of broadcast signals under

part 73 of our rules or used as part of

a licensed service, continue to be

exempt from the scanning receiver

regulations. In order to further clarify

this in the definition, we are replacing

the words ‘‘licensed station’’ with

‘‘licensed service.’’

7. We agree with Tandy and Uniden

that the wording of the signal rejection

ratio rule adopted in the R&O was not

clear, § 15.121(b), states that only

cellular service signals that are ‘‘38 dB

or higher’’ than the receiver sensitivity

should be rejected. This was not the

Commission’s intended meaning for

§ 15.121(b). As stated in the R&O, the

Commission adopted the proposal from

the Notice of Proposed Rule Making, 63

FR 31685, June 10, 1998, in this

proceeding, which stated that scanning

receivers must reject cellular service

signals that are up to 38 dB higher than

the minimum receiver sensitivity.

Therefore, we will amend § 15.121(b) so

that it is clearly understood that

scanning receivers must reject cellular

service signals that are 38 dB or lower

based upon a 12 dB SINAD

specification.

8. Pursuant to the authority contained

in Sections 4(i), 302, 303(e), 303(f),

303(g), 303(r), and 405 of the

Communications Act of 1934, as

amended, it is ordered, that the

Petitions for Reconsideration filed by

Tandy Corporation and Uniden America

Corporation, are Granted in part and

Denied in all other respects.

9. Part 15 of the Commission’s Rules

and Regulations are amended, effective

July 16, 2001. Authority for issuance of

this Memorandum Opinion and Order is

contained in Section 4(i), 301, 302,

303(e), 303(f), 303(g), 303(r), 304, and

307 of the Communications Act of 1934,

as amended, 47 U.S.C. Section 154(i),

301, 302, 303(e), 303(f), 303(g), 303(r),

304 and 307.

List of Subjects

Communications equipment, Radio.

Federal Communications Commission.

Magalie Roman Salas,

Secretary.

Rule Changes

For the reasons discussed in the

preamble, the FCC amends 47 CFR part

15 as follows:

PART 15—RADIO FREQUENCY

DEVICES

1. The authority citation for part 15

continues to read as follows:

Authority: 47 U.S.C. 154, 302, 303, 304,

307 and 544A.

2. Section 15.3 is amended by revising

paragraph (v) to read as follows:

§ 15.3 Definitions.

* * * * *

(v) Scanning receiver. For the purpose

of this part, this is a receiver that

automatically switches among two or

more frequencies in the range of 30 to

960 MHz and that is capable of stopping

at and receiving a radio signal detected

on a frequency. Receivers designed

solely for the reception of the broadcast

signals under part 73 of this chapter, for

the reception of NOAA broadcast

weather band signals, or for operation as

part of a licensed service are not

included in this definition.

* * * * *

3. Section 15.121 is amended by

revising paragraphs (b) and (f) to read as

follows:

§ 15.121 Scanning receivers and

frequency converters used with scanning

receivers.

* * * * *

(b) Except as provided in paragraph

(c) of this section, scanning receivers

shall reject any signals from the Cellular

Radiotelephone Service frequency

bands that are 38 dB or lower based

upon a 12 dB SINAD measurement,

which is considered the threshold

where a signal can be clearly discerned

from any interference that may be

present.

* * * * *

(f) Scanning receivers shall have a

label permanently affixed to the

product, and this label shall be readily

visible to the purchaser at the time of

purchase. The label shall read as

follows: WARNING: MODIFICATION

OF THIS DEVICE TO RECEIVE

CELLULAR RADIOTELEPHONE

SERVICE SIGNALS IS PROHIBITED

UNDER FCC RULES AND FEDERAL

LAW.

(1) ‘‘Permanently affixed’’ means that

the label is etched, engraved, stamped,

silkscreened, indelible printed or

otherwise permanently marked on a

permanently attached part of the

equipment or on a nameplate of metal,

plastic or other material fastened to the

equipment by welding, riveting, or

permanent adhesive. The label shall be

designed to last the expected lifetime of

the equipment in the environment in

which the equipment may be operated

and must not be readily detachable. The

label shall not be a stick-on, paper label.

(2) When the device is so small that

it is not practicable to place the warning

label on it, the information required by

this paragraph shall be placed in a

prominent location in the instruction

manual or pamphlet supplied to the

user and shall also be placed on the

container in which the device is

marketed. However, the FCC identifier

must be displayed on the device.

* * * * *

[FR Doc. 01–15127 Filed 6–14–01; 8:45 am]

BILLING CODE 6712–01–U

DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

49 CFR Part 1180

[STB Ex Parte No. 582 (Sub–No. 1)]

Major Rail Consolidation Procedures

AGENCY: Surface Transportation Board,

DOT.

ACTION: Final rules.

SUMMARY: The Surface Transportation

Board (STB or Board) adopts final

regulations governing proposals for

major rail consolidations. These new

rules substantially increase the burden

on applicants to demonstrate that a

proposed transaction would be in the

public interest, by requiring them,

among other things, to demonstrate that

the transaction would enhance

competition where necessary to offset

negative effects of the merger, such as

competitive harm or service disruptions.

EFFECTIVE DATE: These rules are effective

July 11, 2001.

FOR FURTHER INFORMATION CONTACT: Julia

M. Farr, (202) 565–1613. [TDD for the

hearing impaired: 1–800–877–8339.]

SUPPLEMENTARY INFORMATION:

Additional information is contained in

the Board’s decision. A printed copy of

the Board’s decision is available for a

fee by contacting: Da ̄-To-Da ̄ Office

Solutions, Room 405, 1925 K Street,

NW., Washington, DC 20006, telephone

(202) 293–7776. The Board’s decision is

also available for viewing and

downloading on the Board’s website at

‘‘www.stb.dot.gov.’’

Federal Register / Vol. 66, No. 116 / Friday, June 15, 2001 / Rules and Regulations 32583

Small entities. The Board certifies that

the revisions to our regulations will not

have a significant economic impact on

a substantial number of small entities

within the meaning of the Regulatory

Flexibility Act (5 U.S.C. 601 et seq.).

These rules have created additional

filing requirements only for Class I

applicants, which are very large rail

carriers. At the same time we have given

increased weight to issues and concerns

of smaller railroads and shippers, a

change that should benefit these small

entities.

Environment. This action will not

significantly affect either the quality of

the human environment or the

conservation of energy resources.

Board releases available via the

Internet. Decisions and notices of the

Board, including this decision, are

available on the Board’s website at

‘‘www.stb.dot.gov.’’

Authority: 49 U.S.C. 721, 11323–11325.

List of Subjects in 49 CFR Part 1180

Administrative practice and

procedure, Bankruptcy, Railroads,

Reporting and recordkeeping

requirements.

Decided: June 7, 2001.

By the Board, Chairman Morgan, Vice

Chairman Clyburn, and Commissioner

Burkes. Chairman Morgan commented and

dissented in part with a separate expression.

Vice Chairman Clyburn and Commissioner

Burkes commented with separate

expressions.

Vernon A. Williams,

Secretary.

For the reasons set forth in the

preamble, Title 49, Subtitle B, Chapter

X, Part 1180 of the Code of Federal

Regulations is amended as follows:

PART 1180—RAILROAD ACQUISITION,

CONTROL, MERGER,

CONSOLIDATION PROJECT,

TRACKAGE RIGHTS, AND LEASE

PROCEDURES

1. The authority citation for part 1180

continues to read as follows:

Authority: 5 U.S.C. 553 and 559; 11 U.S.C.

1172; 49 U.S.C. 721, 10502, 11323–11325.

2. Section 1180.0 is revised to read as

follows:

§ 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)).

3. Section 1180.1 is revised to read as

follows:

§ 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, 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

32584 Federal Register / Vol. 66, No. 116 / Friday, June 15, 2001 / Rules and Regulations

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 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 sanctity of collective bargaining

agreements and will look with extreme

disfavor on overrides of collective

bargaining agreements except to the

Federal Register / Vol. 66, No. 116 / Friday, June 15, 2001 / Rules and Regulations 32585

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 sitespecific 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,

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 postmerger 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

32586 Federal Register / Vol. 66, No. 116 / Friday, June 15, 2001 / Rules and Regulations

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.

(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.

4. Section 1180.3 is amended by

revising paragraphs (a) and (b) to read

as follows:

§ 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.

(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.

* * * * *

5. Section 1180.4 is amended by

revising paragraph (a)(1) to read as

follows, by removing paragraph (a)(4),

by adding new paragraphs (b)(4) and

(c)(6)(vi) to read as follows, and by

revising paragraphs (d), (e)(2), (e)(3),

and (f)(2) to read as follows:

§ 1180.4 Procedures.

(a) * * * (1) The original and 25

copies of all documents shall be filed in

major proceedings. The original and 10

copies shall be filed in significant and

minor proceedings.

* * * * *

(b) * * *

(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

Federal Register / Vol. 66, No. 116 / Friday, June 15, 2001 / Rules and Regulations 32587

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) * * *

(6) * * *

(vi) The information and data

required of any applicant may be

consolidated with the information and

data required of the affiliated applicant

carriers.

(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) * * *

(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:

(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.

* * * * *

(f) * * *

(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.

* * * * *

6. Section 1180.6 is amended by

revising paragraphs (b)(1), (b)(2), (b)(3),

(b)(4), (b)(6), and (b)(8) to read as

follows, and by adding new paragraphs

(b)(9), (b)(10), (b)(11), (b)(12), and (b)(13)

to read as follows:

§ 1180.6 Supporting information.

* * * * *

(b) * * *

(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 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.

* * * * *

(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.

* * * * *

(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

32588 Federal Register / Vol. 66, No. 116 / Friday, June 15, 2001 / Rules and Regulations

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.

(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.

* * * * *

7. Section 1180.7 is revised to read as

follows:

§ 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 inter-and 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

(inter- as 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 inter- and

intramodal competition, product

competition, and geographic

competition) and the provision of

essential services (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 competitionenhancing 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 single-line

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

Federal Register / Vol. 66, No. 116 / Friday, June 15, 2001 / Rules and Regulations 32589

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.

8. Section 1180.8 is amended by

redesignating paragraphs (a) and (b) as

paragraphs (b) and (c), respectively, and

by adding a new paragraph (a) to read

as follows:

§ 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 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 mergerrelated changes in operations or

increases in rail traffic.

* * * * *

9. A new § 1180.10 is added to

subpart A to read as follows:

§ 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 fullsystem 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-byshipper 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 and/or

regional rail passenger operators to

minimize any potential transactionrelated 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.

32590 Federal Register / Vol. 66, No. 116 / Friday, June 15, 2001 / Rules and Regulations

(i) Contingency plans for mergerrelated 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

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 railroad-created 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.

10. A new § 1180.11 is added to

subpart A to read as follows:

§ 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.

[FR Doc. 01–14984 Filed 6–14–01; 8:45 am]

BILLING CODE 4915–00–P