Passenger Operations by Mexican Motor Carriers--Implementation of North American Free Trade Agreement

Sidney L. Strickland, Jr. (Federal Register)
January 10, 1994

[Federal Register Volume 59, Number 6 (Monday, January 10, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 94-503]


[[Page Unknown]]

[Federal Register: January 10, 1994]


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INTERSTATE COMMERCE COMMISSION

[Ex Parte No. 55 (Sub-No. 93)]

 

Passenger Operations by Mexican Motor Carriers--Implementation of 
North American Free Trade Agreement

AGENCY: Interstate Commerce Commission.

ACTION: Notice of policy statement.

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SUMMARY: The purpose of this Notice is to announce implementation of 
the provisions of the first phase of the North American Free Trade 
Agreement (NAFTA) relating to land transportation. Effective January 1, 
1994, the Commission will accept and process applications by Mexican 
passenger carriers for operating authority to provide charter and tour 
bus service across the United States-Mexico International Border line 
into the United States.

DATES: The policy announced here will apply to applications filed on or 
after January 1, 1994. Comments must be filed by January 18, 1994.

ADDRESSES: Send comments referring to Ex Parte No. 55 (Sub-No. 93) to: 
Office of the Secretary, Case Control Branch, Interstate Commerce 
Commission, Washington, DC 20423.

FOR FURTHER INFORMATION CONTACT: Joseph B. O'Malley (202) 927-6292, or 
Richard B. Felder (202) 927-5610. [TDD for hearing impaired: (202) 927-
5721.]

SUPPLEMENTARY INFORMATION: Section 6 of the Bus Regulatory Reform Act 
of 1982 (codified at 49 U.S.C. 10922(l)) imposed a 2-year moratorium 
(subject to renewal) on the Commission's issuance of new grants of 
operating authority to motor carriers domiciled in or owned or 
controlled by persons of Mexico or Canada. Under this statute, the 
President has the authority to remove or modify the moratorium if he 
determines it to be in the national interest, that is, if overriding 
economic or foreign policy considerations make such an action 
advisable, or if a negotiated settlement with one country or the other 
can be reached. Under the moratorium, the President must notify the 
Congress in writing 60 days before the date on which the removal or 
modification is to take effect.
    Shortly after it went into effect, the President exercised his 
authority and removed the moratorium with respect to Canada. The 
President indicated in a memorandum to the United States Trade 
Representative that the United States and Canada had reached a 
bilateral understanding that would ensure fair and equitable treatment 
for both U.S. and Mexican motor carriers on both sides of the 
International Boundary line. 47 FR 54053.
    The moratorium remained in place for Mexican motor carriers because 
the Mexican Government continued to restrict U.S. motor carriers' 
access to Mexico. Under the terms of the statute, the President 
extended the moratorium for 2-year periods in 1984, 1986, 1988, 1990, 
and, most recently, in 1992. On November 3, 1993, however, in a 
Statement of Administrative Action, the President gave notice to 
Congress that he would lift the moratorium with respect to Mexican 
charter and other tour services on NAFTA's effective date, that is, on 
January 1, 1994.\1\
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    \1\This satisfies the 60-day notice period called for under 49 
U.S.C. 10922(l). In any event, Congress, in approving NAFTA, 
specifically consented to the President's modifying the moratorium 
as announced on November 3, 1993.
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    Under NAFTA, the moratorium will be lifted in phases.\2\ The 
schedule of liberalization is as follows:
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    \2\The NAFTA schedule of liberalization does not remove all 
barriers for Mexican motor carrier operations in the United States. 
The moratorium will remain in place for Mexican carriers in the one 
area that was not liberalized, namely, point to point carriage of 
domestic cargo in the United States.
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1. Upon entry into force of NAFTA, for access by Mexican charter and 
tour bus operators;
2. Three years after signature of NAFTA, for access by Mexican motor 
property carriers into United States border States, and for 
establishing companies to distribute international cargo within the 
United States;
3. Three years after entry into force, for access by Mexican regular-
route passenger carriers;
4. Six years after entry into force, access for cross-border operations 
by Mexican motor property carriers.

    In Phase 1 of NAFTA, Mexican domiciled or owned or controlled 
passenger carriers may now apply for authority under 49 U.S.C. 10922(c) 
to transport passengers in charter and tour bus service in the United 
States in foreign commerce, that is, the service must begin or end in 
Mexico (or Canada). Wholly domestic interstate operations in the United 
States cannot be authorized or permitted.
    NAFTA authorizes the granting of authority for charter operations 
and tour bus service only. By statute, we may authorize motor common 
carriers of passengers to operate over either regular or irregular 
routes, but irregular-route services must be limited to charter and 
special operations. Regular-route operations ordinarily involve the 
expeditious transportation of passengers between fixed termini, over 
defined routes and according to established schedules. Charter 
operations, on the other hand, ordinarily contemplate providing 
transportation for a group, assembled by someone other than the 
carrier, which group contracts for the exclusive use of certain 
equipment for the duration of a particular trip or tour. Generally, a 
flat rate for the use of the vehicle is charged, on either a 
``mileage'' or an ``hourly'' basis, and the passengers travel together 
for the entire trip.
    As we recognized most recently in Adirondack Transit Lines, Inc.--
Adirondack Trailways, 8 I.C.C.2d 330, 334 n.5 (1992), special 
operations originally were described as services rendered (generally on 
weekends, holidays, or other special occasions) to a number of 
passengers that the carrier itself has assembled into a travel group 
through its own sales of a ticket to each individual passenger covering 
a particular trip or tour. Fordham Bus Corp. Common Carrier 
Application, 29 M.C.C. 293, 297 (1941). In Asbury Park-N.Y. Transit 
Corp. v. Bingler Vacation Tours, 62 M.C.C. 731, 740 (1954) (Bingler), 
aff'd sub nom. Bingler Vacation Tours v. United States, 132 F. Supp. 
793 (D. N.J. 1955), aff'd per curiam, 350 U.S. 921 (1955), though, the 
Commission adopted the position that ``special operations'' is a 
catchall classification, which may include almost anything that is 
neither charter operations nor the usual operations of a regular-route 
carrier.
    Accordingly, ``tour service'' is only one form of special 
operations, as the Commission discussed in Passenger Transportation in 
Special Operations, 112 M.C.C. 160, 165-67, 171-74 (1970), which 
clearly distinguishes the requirements of ``tour service'' from those 
of ordinary special operations. Thus, under the Bingler criterion, to 
constitute a ``tour service'', the carrier must furnish something 
substantial in addition to, or different from, bare expeditious 
transportation between two points. This contemplates a common interest 
of passengers visiting a particular place(s) or event(s) and does not 
include ordinary, point-to-point transportation, over either regular or 
irregular routes.3 It appears that the ``tour service'' that NAFTA 
is intended to cover is this type of special operations.
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    \3\Special operations that are not ``tour services'' might 
include, for example, limousine services in which door-to-door 
service is provided, over irregular routes (according to the 
specific locations to be served on any particular trip), to and from 
any point in a given territory. Such services will not be authorized 
by authority to provide ``tour service''.
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    Accordingly, certificates that we issue to Mexican carriers will 
usually be framed, in accord with our usual practices with regard to 
such authorities, to authorize service

Over irregular routes, in foreign commerce, transporting passengers, in 
charter operations and in special operations, in tour service, between 
ports of entry on the international boundary between the U.S. and 
Mexico, on the one hand, and, on the other, points in the United States 
(except Alaska and Hawaii).

    Because this notice is occasioned by a partial lifting of the 
moratorium, no special rules or rulemaking are necessary. The same 
application procedure and regulations apply to Mexican and United 
States carriers alike. For example, carriers must abide by all U.S. 
Department of Transportation safety regulations, comply with the 
Commission's insurance requirements (49 U.S.C. 10927), publish and file 
with the Commission applicable tariffs (49 U.S.C. 10761, 10762), and 
file with the Commission agents for service of process (49 U.S.C. 
10330). We will, however, provide a short comment period to enable 
interested persons to submit written views, arguments or 
representations regarding this subject. Because we have little or no 
discretion in this area, we do not contemplate a subsequent decision 
unless we receive comments raising substantial issues it would be 
helpful or necessary to address. Notice of this proceeding will be 
published in the Federal Register and the ICC Register and interested 
parties will have 7 days from the date of publication to comment.
    Finally, the current application form OP-1 requires all applicants 
for ICC operating authority to certify that they are not domiciled in 
Mexico or owned or controlled by persons of Mexico. We will modify that 
certification requirement when we revise the application form. For the 
present, Mexican charter and special operations applicants should 
either disregard the certification section, or simply indicate ``not 
applicable.'' Applicants not completing the certification affirmatively 
will receive charter and special operations tour service authority 
limited to movements in foreign commerce.

    Decided: December 30, 1993.

    By the Commission, Chairman McDonald, Vice Chairman Simmons, 
Commissioners Phillips and Philbin.
Sidney L. Strickland, Jr.,
Secretary.
[FR Doc. 94-503 Filed 1-7-94; 8:45 am]
BILLING CODE 7035-01-P