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Last week, U.S. Sen. Herb Kohl (D-Wis.) called on federal justice and transportation department leaders to support his Railroad Antitrust Enforcement Act (S. 49), which proposes to repeal railroads’ antitrust exemptions.
In a letter sent to U.S. Transportation Secretary Ray LaHood and U.S. Assistant Attorney General Christine Varney, Kohl wrote, “we must ensure that freight railroads are subject to the basic principles of fair competition by repealing their obsolete and undeserved exemption from the antitrust laws.”
Railroad mergers and acquisitions are exempt from antitrust law and are reviewed solely by the Surface Transportation Board, he said. Railroads that engage in collective ratemaking also are exempt from antitrust law, said Kohl, who chairs the Senate Antitrust, Competition Policy and Consumer Rights subcommittee, adding that private parties have no right to obtain injunctions to halt "anti-competitive practices.”
The bill would allow the federal government, state attorneys general and private parties to file suit to enjoin "anti-competitive" rail mergers and acquisitions; transfer the review of rail mergers to the justice department’s antitrust division; and eliminate the antitrust exemption for collective rail ratemaking.
The rail industry heavily opposes S. 49. The industry needs "balanced regulation" to ensure freight rail can continue to meet the nation's transportation needs, according to the Association of American Railroads.