Interstate Commerce Commission (ICC)

The Interstate Commerce Commission (ICC), established in 1887, was the first federal agency created in the United States to regulate railroads and later trucking, ensuring fair rates and eliminating discriminatory practices in interstate transportation.

Interstate Commerce Commission (ICC)

The Interstate Commerce Commission (ICC) was a regulatory body in the United States, founded by the Interstate Commerce Act of 1887. It served as the country’s first independent regulatory agency, originally tasked with overseeing the railroad industry and later expanding its scope to include trucking, bus lines, and other modes of transportation engaged in interstate commerce.

Key Functions and Responsibilities

  • Regulation of Rates: The ICC was responsible for ensuring that railroad rates were “reasonable and just” and preventing discriminatory practices.
  • Investigation of Complaints: It investigated complaints of unfair practices and had the authority to issue orders to rectify those practices.
  • Licensing and Permits: It granted operating licenses to carriers and regulated their adherence to safety and service standards.

Examples

  1. Rate Regulations: The ICC intervened to regulate the rates that companies could charge for transporting goods and passengers, preventing railroads from exercising monopolistic control over prices.
  2. Fair Practices: It required railroads to publish their rates and applied restrictions against unjust discrimination. For instance, it was illegal for railroads to charge more for a shorter trip than for a longer trip where the route overlapped.
  3. Trucking Regulation: Following the Motor Carrier Act of 1935, the ICC expanded its regulatory oversight to include the burgeoning trucking industry, ensuring compliance with similar fair practice and rate regulations.

Frequently Asked Questions (FAQs)

Q1: Why was the ICC established?
A1: The ICC was established in response to public outcry against the monopolistic practices of the railroad industry, such as unfair rates, rebates, and discriminatory practices against small markets and farmers.

Q2: When was the ICC abolished?
A2: The ICC was abolished in 1995, and its remaining functions were transferred to the Surface Transportation Board.

Q3: Did the ICC regulate other forms of transportation besides railroads?
A3: Yes, over time, the ICC’s jurisdiction expanded to include trucking, bus lines, and other forms of interstate transportation.

Q4: What was the significance of the Motor Carrier Act of 1935?
A4: The Motor Carrier Act of 1935 extended the ICC’s regulatory powers to include the emerging trucking industry, standardizing the licensing, rates, and safety records.

  • Interstate Commerce Act: The 1887 law that established the ICC.
  • Surface Transportation Board (STB): The agency that succeeded the ICC after its abolishment, continuing the regulation of rail and broader surface transportation.
  • Public Utility Commission: State agencies established to oversee local utilities, often modeled after the ICC.

Online References

Suggested Books for Further Studies

  • “Interstate Commerce Commission and the Railroad Industry: A History of Regulatory Policy” by Richard D. Stone
  • “The Rise and Fall of Regulation: A History of the Interstate Commerce Commission” by Ari Hoogenboom

Fundamentals of Interstate Commerce Commission (ICC): Business Law Basics Quiz

### What year was the Interstate Commerce Commission (ICC) established? - [ ] 1877 - [x] 1887 - [ ] 1897 - [ ] 1907 > **Explanation:** The ICC was established in 1887 by the Interstate Commerce Act to regulate railroads and later other forms of interstate transportation. ### What was the primary reason for the establishment of the ICC? - [ ] To promote international trade - [ ] To increase railroad profits - [x] To regulate railroad rates and prevent unfair practices - [ ] To protect railroad stockholders > **Explanation:** The ICC was established to regulate railroad rates and eliminate unfair practices such as monopoly pricing and discriminatory rates. ### Under which act did the ICC gain authority to regulate the trucking industry? - [ ] Sherman Antitrust Act - [ ] Clayton Act - [x] Motor Carrier Act of 1935 - [ ] Federal Trade Commission Act > **Explanation:** The Motor Carrier Act of 1935 extended the ICC’s regulatory authority to include the trucking industry. ### When was the ICC abolished? - [ ] 1985 - [ ] 1990 - [x] 1995 - [ ] 2000 > **Explanation:** The ICC was abolished in 1995, and its functions were transferred to the Surface Transportation Board. ### Which agency succeeded the ICC? - [ ] Federal Trade Commission - [ ] National Transportation Safety Board - [x] Surface Transportation Board - [ ] Federal Railroad Administration > **Explanation:** The Surface Transportation Board (STB) took over the residual functions of the ICC after it was abolished. ### What types of unfair practices did the ICC prevent? - [x] Discriminatory rates and monopolistic practices - [ ] Insider trading - [ ] Patent infringements - [ ] Environmental violations > **Explanation:** The ICC focused on preventing discriminatory rates and monopolistic practices within the transportation industry. ### Which industry was the ICC initially created to regulate? - [ ] Airline industry - [ ] Shipping industry - [x] Railroad industry - [ ] Automobile industry > **Explanation:** The ICC was initially created to regulate the railroad industry. ### What act of Congress established the ICC? - [ ] Federal Reserve Act - [x] Interstate Commerce Act - [ ] Sherman Antitrust Act - [ ] Civil Rights Act > **Explanation:** The ICC was established by the Interstate Commerce Act of 1887. ### How did the ICC ensure fair transportation rates? - [ ] By subsidizing railroads - [x] By regulating and enforcing rate standards - [ ] By providing loans - [ ] By setting fuel prices > **Explanation:** The ICC ensured fair transportation rates by regulating and enforcing rate standards to prevent discriminatory practices. ### Which of the following was a significant legislative action that broadened the ICC’s jurisdiction? - [ ] Interstate Commerce Act - [ ] Clayton Antitrust Act - [ ] Wagner Act - [x] Motor Carrier Act of 1935 > **Explanation:** The Motor Carrier Act of 1935 was significant because it broadened the ICC's jurisdiction to include the trucking industry.

Thank you for exploring the depth of regulatory history with the Interstate Commerce Commission. Happy learning!

Wednesday, August 7, 2024

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