Federal regulation of railroads

Federal regulation of railroads

Irving Oil workers inspect rail cars carrying crude oil at the Irving Oil rail yard terminal in Saint John, New Brunswick.

Regulation of railroads by the federal government originated with the passage in 1887 of the Act to Regulate Commerce, or Interstate Commerce Act. With amendments, that law is currently the principal vehicle of federal regulation. It sought to deal with certain basic problems that had developed under unrestricted competition.

Among its provisions were prohibitions against, and penalties for, undue preference, discrimination, rebates, and pooling; requirements that rates and charges be just and reasonable and that rate schedules be published and adherence to them be mandatory; a long-and-short haul rule prohibiting greater charges for a short haul than for a long haul over the same route in the same direction; and creation of the five-member Interstate Commerce Commission, or ICC, charged with enforcement of the act. In 1897 in the Maximum Freight Rate case, the Supreme Court decided that the act did not confer on the ICC power to prescribe rates. The Court in 1897 likewise weakened the long-and-short-haul clause in the Alabama Midland case.

Safety regulations began with the Federal Safety Appliance Act of 1893. It required the installation of power brakes on all cars, and of automatic couplers. The act was amended in 1903, 1910, and 1958 to extend its application.

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