STB adopts new rules on transactions involving interchange agreements

The Surface Transportation Board (STB) yesterday announced it adopted final rules establishing disclosure requirements for transactions involving interchange agreements.

Contractual provisions included in a rail line lease or sale, interchange agreements limit the incentive or ability of a tenant or purchaser railroad to interchange traffic with a railroad other than the leasing or selling railroad.

Under the STB's former rules, if a proposed rail line acquisition involved an interchange agreement, the proponent had to inform the board about the pact and file a complete, confidential version of it with the STB.

Now under the adopted final rules, parties must file the following with the board: information concerning shippers, carloads and potential interchanging railroads on the affected line; a verification that shippers on the line have been notified; an estimate of the lease- or sale-price differential with and without an interchange agreement; and a case caption that indicates an interchange commitment.

The purpose of the rulemaking is to help the board and affected parties determine at the outset whether a transaction that includes an interchange agreement is appropriate for the board's exemption process or raises competitive issues that require a more detailed examination, STB members said in their decision.