Memorandum on the Bus Regulatory Reform Act of 1982

September 20, 1982

Memorandum for the United States Trade Representative

Subject: Determination under the Bus Regulatory Reform Act of 1982

The Bus Regulatory Reform Act of 1982 addresses in Section 6 the issue of transborder trucking. It imposes a moratorium on the issuance of certificates or permits to motor carriers domiciled in, or owned or controlled by persons of, a contiguous foreign country. I am authorized to remove the moratorium in whole or in part for any country or political subdivision thereof upon determining that such action is in the national interest. I must also provide written notice to the Congress of such removal or modification before it becomes effective. Sixty days' advance notice to the Congress is required whenever the removal or modification applies to a foreign contiguous country or political subdivision thereof which substantially prohibits the granting of motor carrier authority to persons from the United States. I hereby determine that this sixty-day advance notification provision is not now applicable to Canada.

The transborder trucking issue has been the subject of extensive discussions between the United States and Canada and between the United States and Mexico. Because of the importance of fair and open competition in this important service sector, I am today instructing you, as my Trade Representative, to intensify our efforts to negotiate a fair and equitable resolution of this issue with both Canada and Mexico.

I regret that with respect to Mexico there has not yet been progress sufficient to justify a modification of the moratorium. A substantial disparity remains between the relatively open access afforded Mexican trucking service coming into the United States and the almost complete inability of United States trucking interests to provide service into Mexico.

In the case of Canada, our trucking industry is not now, nor has it been, precluded from providing services into that country. However, our regulatory schemes do now differ. Since the United States deregulation legislation, Canadian trucking interests could have an opportunity to provide single-line service into the United States more easily than their United States counterparts can provide into Canada. In addition, United States firms seeking to become established in Canada may be subjected to investment restrictions not facing their Canadian competitors.

I believe that our national interest is best served by fair and equitable competition between United States and Canadian trucking interests in our two markets.

Therefore, under my authority to remove in whole or in part the moratorium imposed in Section 6 of the Bus Regulatory Reform Act which prohibits issuance of certificates or permits to motor carriers domiciled in, or owned or controlled by persons of, a contiguous foreign country, I hereby find that it is in the national interest to modify the moratorium by suspending it insofar as Canada is concerned as set forth below.

Accordingly, you are directed to notify the Congress today on my behalf that, effective tomorrow: (1) The moratorium for Canada is suspended insofar as necessary to permit the Interstate Commerce Commission (ICC) to grant authority to motor carriers under the appropriate sections of 49 U.S.C. subtitle IV. This suspension is expressly conditioned upon the Commission, in making determinations on whether the proposed transportation serves a ``useful public purpose'' or is in the ``public interest,'' according great weight to the national transportation policy, particularly the mandates to promote ``economical and efficient transportation,'' and ``to encourage sound economic conditions in transportation including sound economic conditions among carriers.'' Such determinations by the Commission shall be consistent with the directives of the United States Trade Representative concerning the international trade policy of the United States; (2) The moratorium in regard to Canadian applicants is further modified by suspending it to permit the ICC to issue temporary and emergency temporary authority, and to issue certificates in motor carrier merger, consolidation, and acquisition of control proceedings, and motor carrier restriction removal proceedings; (3) The moratorium is further modified by suspending it insofar as issuance of ICC authorities to Canadian carriers for domestic traffic in the United States under the appropriate sections of 49 U.S.C. subtitle IV is concerned. Canadian-owned, controlled, or domiciled firms will be able to apply for and receive ICC authority for operations wholly within the United States.

Finally, having directed you to seek an understanding with Canada that will ensure the fair and equitable treatment of both Canadian and United States trucking interests on both sides of the border, I further direct you to report back to me within sixty days on those discussions. It is my expectation that such time should be sufficient for an appropriate understanding to allow me to finally remove the moratorium.

This determination shall be published in the Federal Register.

Ronald Reagan

[Filed with the Office of the Federal Register, 5:10 p.m., September 20, 1982]