Transportation Regulation

Transportation Regulation

1. Economic Regulation
• Focuses on:
• Prevention of monopolies
• Development of fair competition
• Financial performance of the transportation industry
• During the middle of the 20th century, U.S. Transportation Industry was heavily regulated
• Interstate Commerce Commission (ICC) was a large governmental body responsible for overseeing most of the economic regulation of transportation
• ICC was abolished in 1996
• ICC was replaced by a smaller and more cost-efficient board, called the Surface Transportation Board (STB)
2. Antitrust Laws
• Typically server on of two primary purposes:
• To challenge monopoly power
• To prevent specific business practices considered anti-competitive
• The Justice Department takes particular interest in pricing and mergers because these two areas can threaten competition
  
3. Safety Regulation
• Department of Transportation (DOT) was established in 1966
• DOT is responsible for providing the United States with a national transportation policy aimed at improving the safety and efficiency of the transportation system
• DOT is now partitioned into several sub-agencies:
• Federal Highway Administration (FHA)
• Federal Railroad Administration (FRA)
• Federal Maritime Administration (FMA)
  
4. Legal Forms Carriage
• Carriers are classified in two ways:
• Private
• A private carrier typically transports goods for the company that owns it
• Example: Wal-Mart owns a motor carrier fleet specifically to stock Wal-Mart retail outlets
• The main advantage of private transportation is that the firm has complete control of the fleet
• The main disadvantage of private carriage is the large initial capital investment required
  
  
• For-Hire
• Common
• Common Carriers must serve the general public without discrimination and charge responsible rates
• Contract
• Contract Carriers are not required to serve the general public
• Exempt
• Some 'For-Hire' Carriers are exempt from economic regulation of rates or services
• Carriers become exempt by hauling certain products or by the nature of their operation