Surface Transportation Board Extends Authority to Set Rates
The decision preserves antitrust immunity for rate bureaus and classification activities until Dec. 31, 1999.
Beyond that date, however, baring any Congressional action, the Board said it would approve rate bureau agreements only if "benchmark" rates are reduced to reflect market price levels.
That could put an end to the widespread practice of offering discounts of 50% to 60% from published tariffs.
"If bureaus want to retain their immunity," the board said, "their class rates should be reduced to market-based levels."
The Board also suggested that shippers and other "users" be given a greater voice in the freight classification process.
In reviewing public comments on the classification issue, the Board said it found "concern" over the way in which the NCC operates, but concluded the system "can produce public benefits."
"The classification system should produce efficiencies for motor carriers that should be passed on to their customers," the Board said. "All things considered, as long as classification is effected in a rational way that gives an adequate voice to the users of the system, we would not find it contrary to the public interest."
Gene Foley, executive director of the National Motor Freight Traffic Assn., said he was pleased with the Board’s decision to extend the current classification agreement, but expressed dismay with the suggestion that shippers are not adequately represented.
"Shippers have the opportunity from the beginning and every step along the way to participate in classification proposals," he said.
The NCC classifies freight based on density, stowability, liability and handling characteristics. All changes in classification are first publicized and investigated by the NMFTA staff and then voted on by the full committee.
The NCC is comprised of not more than 100 motor carrier representatives.
