49 U.S.C. § 11322 — Limitation on pooling and division of

Page 450 TITLE 49—TRANSPORTATION § 11321 A prior section 11301, Pub. L. 95–473, Oct. 17, 1978, 92 Stat. 1428; Pub. L. 103–429, § 6(16), Oct. 31, 1994, 108 Stat. 4379, related to authority of certain carriers to issue se- curities and assume obligations and liabilities, prior to the general amendment of this subtitle by Pub. L. 104–88, § 102(a). A prior section 11302, Pub. L. 95–473, Oct. 17, 1978, 92 Stat. 1430; Pub. L. 96–296, § 18(a), July 1, 1980, 96 Stat. 811, provided that section 11301 of this title applied to motor carriers and corporations subject to jurisdiction of Interstate Commerce Commission under former sub- chapter II of chapter 105 of this title, but did not apply to corporations under a certain capitalization, and that this section did not apply to Federal, State, or local governments, prior to repeal by Pub. L. 97–261, §§ 19(a), 31(a), Sept. 20, 1982, 96 Stat. 1121, 1129, effective on the 60th day after Sept. 20, 1982. Prior sections 11303 and 11304 were omitted in the general amendment of this subtitle by Pub. L. 104–88, § 102(a). Section 11303, Pub. L. 95–473, Oct. 17, 1978, 92 Stat. 1430; Pub. L. 103–272, § 5(m)(30), July 5, 1994, 108 Stat. 1378, related to filing and recording of mortgages, leases, equipment trusts, and other agreements with Interstate Commerce Commission. See section 11301 of this title. Section 11304, Pub. L. 95–473, Oct. 17, 1978, 92 Stat. 1431; Pub. L. 96–258, § 1(12), June 3, 1980, 94 Stat. 426, re- lated to security interests in certain motor vehicles. See section 14301 of this title. AMENDMENTS 1996—Subsec. (f). Pub. L. 104–287 substituted ‘‘January 1, 1996’’ for ‘‘the effective date of the ICC Termination Act of 1995’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective Jan. 1, 1996, except as otherwise pro- vided in Pub. L. 104–88, see section 2 of Pub. L. 104–88, set out as a note under section 1301 of this title. ABOLITION OF INTERSTATE COMMERCE COMMISSION Interstate Commerce Commission abolished by sec- tion 101 of Pub. L. 104–88, set out as a note under sec- tion 1301 of this title. SUBCHAPTER II—COMBINATIONS § 11321. Scope of authority (a) The authority of the Board under this sub- chapter is exclusive. A rail carrier or corpora- tion participating in or resulting from a trans- action approved by or exempted by the Board under this subchapter may carry out the trans- action, own and operate property, and exercise control or franchises acquired through the transaction without the approval of a State au- thority. A rail carrier, corporation, or person participating in that approved or exempted transaction is exempt from the antitrust laws and from all other law, including State and mu- nicipal law, as necessary to let that rail carrier, corporation, or person carry out the trans- action, hold, maintain, and operate property, and exercise control or franchises acquired through the transaction. However, if a purchase and sale, a lease, or a corporate consolidation or merger is involved in the transaction, the car- rier or corporation may carry out the trans- action only with the assent of a majority, or the number required under applicable State law, of the votes of the holders of the capital stock of that corporation entitled to vote. The vote must occur at a regular meeting, or special meeting called for that purpose, of those stockholders and the notice of the meeting must indicate its purpose. (b) A power granted under this subchapter to a carrier or corporation is in addition to and changes its powers under its corporate charter and under State law. Action under this sub- chapter does not establish or provide for estab- lishing a corporation under the laws of the United States. (Added Pub. L. 104–88, title I, § 102(a), Dec. 29, 1995, 109 Stat. 838.) Editorial Notes PRIOR PROVISIONS Provisions similar to those in this section were con- tained in section 11341 of this title prior to the general amendment of this subtitle by Pub. L. 104–88, § 102(a). A prior section 11321, Pub. L. 95–473, Oct. 17, 1978, 92 Stat. 1432, related to limitations on ownership of cer- tain water carriers, prior to the general amendment of this subtitle by Pub. L. 104–88, § 102(a). Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective Jan. 1, 1996, except as otherwise pro- vided in Pub. L. 104–88, see section 2 of Pub. L. 104–88, set out as a note under section 1301 of this title. § 11322. Limitation on pooling and division of transportation or earnings (a) A rail carrier providing transportation sub- ject to the jurisdiction of the Board under this part may not agree or combine with another of those rail carriers to pool or divide traffic or services or any part of their earnings without the approval of the Board under this section or section 11123 of this title. The Board may ap- prove and authorize the agreement or combina- tion if the rail carriers involved assent to the pooling or division and the Board finds that a pooling or division of traffic, services, or earn- ings— (1) will be in the interest of better service to the public or of economy of operation; and (2) will not unreasonably restrain competi- tion. (b) The Board may impose conditions gov- erning the pooling or division and may approve and authorize payment of a reasonable consider- ation between the rail carriers. (c) The Board may begin a proceeding under this section on its own initiative or on applica- tion. (Added Pub. L. 104–88, title I, § 102(a), Dec. 29, 1995, 109 Stat. 838.) Editorial Notes PRIOR PROVISIONS Provisions similar to those in this section were con- tained in section 11342 of this title prior to the general amendment of this subtitle by Pub. L. 104–88, § 102(a). A prior section 11322, Pub. L. 95–473, Oct. 17, 1978, 92 Stat. 1433, related to restrictions on officers and direc- tors of carriers, prior to the general amendment of this subtitle by Pub. L. 104–88, § 102(a). See section 11328 of this title. Page 451 TITLE 49—TRANSPORTATION § 11324 Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective Jan. 1, 1996, except as otherwise pro- vided in Pub. L. 104–88, see section 2 of Pub. L. 104–88, set out as a note under section 1301 of this title. § 11323. Consolidation, merger, and acquisition of control (a) The following transactions involving rail carriers providing transportation subject to the jurisdiction of the Board under this part may be carried out only with the approval and author- ization of the Board: (1) Consolidation or merger of the properties or franchises of at least 2 rail carriers into one corporation for the ownership, management, and operation of the previously separately owned properties. (2) A purchase, lease, or contract to operate property of another rail carrier by any number of rail carriers. (3) Acquisition of control of a rail carrier by any number of rail carriers. (4) Acquisition of control of at least 2 rail carriers by a person that is not a rail carrier. (5) Acquisition of control of a rail carrier by a person that is not a rail carrier but that con- trols any number of rail carriers. (6) Acquisition by a rail carrier of trackage rights over, or joint ownership in or joint use of, a railroad line (and terminals incidental to it) owned or operated by another rail carrier. (b) A person may carry out a transaction re- ferred to in subsection (a) of this section or par- ticipate in achieving the control or manage- ment, including the power to exercise control or management, in a common interest of more than one of those rail carriers, regardless of how that result is reached, only with the approval and authorization of the Board under this sub- chapter. In addition to other transactions, each of the following transactions are considered achievements of control or management: (1) A transaction by a rail carrier that has the effect of putting that rail carrier and per- son affiliated with it, taken together, in con- trol of another rail carrier. (2) A transaction by a person affiliated with a rail carrier that has the effect of putting that rail carrier and persons affiliated with it, taken together, in control of another rail car- rier. (3) A transaction by at least 2 persons acting together (one of whom is a rail carrier or is af- filiated with a rail carrier) that has the effect of putting those persons and rail carriers and persons affiliated with any of them, or with any of those affiliated rail carriers, taken to- gether, in control of another rail carrier. (c) A person is affiliated with a rail carrier under this subchapter if, because of the relation- ship between that person and a rail carrier, it is reasonable to believe that the affairs of another rail carrier, control of which may be acquired by that person, will be managed in the interest of the other rail carrier. (Added Pub. L. 104–88, title I, § 102(a), Dec. 29, 1995, 109 Stat. 838.) Editorial Notes PRIOR PROVISIONS Provisions similar to those in this section were con- tained in section 11343 of this title prior to the general amendment of this subtitle by Pub. L. 104–88, § 102(a). A prior section 11323, Pub. L. 95–473, Oct. 17, 1978, 92 Stat. 1433; Pub. L. 99–521, § 10(a), (b)(1), Oct. 22, 1986, 100 Stat. 2997, related to limitation on ownership of other carriers by household goods freight forwarders, prior to the general amendment of this subtitle by Pub. L. 104–88, § 102(a). Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective Jan. 1, 1996, except as otherwise pro- vided in Pub. L. 104–88, see section 2 of Pub. L. 104–88, set out as a note under section 1301 of this title. § 11324. Consolidation, merger, and acquisition of control: conditions of approval (a) The Board may begin a proceeding to ap- prove and authorize a transaction referred to in section 11323 of this title on application of the person seeking that authority. When an applica- tion is filed with the Board, the Board shall no- tify the chief executive officer of each State in which property of the rail carriers involved in the proposed transaction is located and shall no- tify those rail carriers. The Board shall hold a public hearing unless the Board determines that a public hearing is not necessary in the public interest. (b) In a proceeding under this section which involves the merger or control of at least two Class I railroads, as defined by the Board, the Board shall consider at least— (1) the effect of the proposed transaction on the adequacy of transportation to the public; (2) the effect on the public interest of includ- ing, or failing to include, other rail carriers in the area involved in the proposed transaction; (3) the total fixed charges that result from the proposed transaction; (4) the interest of rail carrier employees af- fected by the proposed transaction; and (5) whether the proposed transaction would have an adverse effect on competition among rail carriers in the affected region or in the national rail system. (c) The Board shall approve and authorize a transaction under this section when it finds the transaction is consistent with the public inter- est. The Board may impose conditions governing the transaction, including the divestiture of par- allel tracks or requiring the granting of track- age rights and access to other facilities. Any trackage rights and related conditions imposed to alleviate anticompetitive effects of the trans- action shall provide for operating terms and compensation levels to ensure that such effects are alleviated. When the transaction con- templates a guaranty or assumption of payment of dividends or of fixed charges or will result in an increase of total fixed charges, the Board may approve and authorize the transaction only if it finds that the guaranty, assumption, or in- crease is consistent with the public interest. The Board may require inclusion of other rail carriers located in the area involved in the transaction if they apply for inclusion and the