On Petition for Review of an Order of the Interstate Commerce Commission.
Before Sprecher and Wood, Circuit Judges, and Campbell, Senior District Judge.*fn*
The three affected corporations sought review of the Interstate Commerce Commission's determination that a non-carrier holding company which owns all of the stock of two motor carrier subsidiaries that were operated as a single integrated carrier system would "acquire control" of the subsidiaries upon their merger under Section 5(2) of the Interstate Commerce Act, and would therefore become subject to partial regulation as a carrier under Section 5(4).
United Parcel Service of America (UPS-A), a Delaware corporation, is a holding company which owns all of the outstanding stock of United Parcel Service, Inc., a New York corporation (UPS-NY), operating as a motor common carrier in 13 Middle Atlantic and New England states, and all of the outstanding stock of United Parcel Service, Inc., an Ohio corporation (UPS-OH), operating as a motor common carrier in the remaining 35 mainland United States. In addition to controlling the two interstate carriers, UPS-A controls as subsidiaries motor carriers offering interstate retail deliveries in Pennsylvania, Florida, and Virginia, an air freight forwarder, and a bonded messenger service.
UPS-A has not been subject to Commission regulation heretofore because it acquired control of the two regulated carriers (UPS-NY and UPS-OH) prior to the effective date of the Motor Carrier Act of 1935.
UPS-NY, UPS-OH and UPS-A joined in an application to the Commission for authority under Section 5(2) of the Act to merge UPS-NY into UPS-OH. The Commission approved the proposed merger after finding that the merger constituted a transaction within the scope of Section 5(2) and was consistent with the public interest. The Commission further found that upon consummation of the merger, UPS-A would "acquire control" of the surviving corporation and become a carrier within the meaning of Section 5(4), subject to certain reporting and accounting requirements of the Act. 127 M.C.C. 292 (1978). UPS-A, UPS-OH and UPS-NY have petitioned for review of the Commission's order.
The Interstate Commerce Act was revised, codified and enacted, without substantive change, as subtitle IV of title 49 of the United States Code on October 17, 1978, shortly after the Commission entered the order appealed from here, which occurred on August 21, 1978. The new codification provides that an action taken under a law replaced by it shall be deemed to have been taken under the new codification.
Section 5(2)(a) now appears at 49 U.S.C. § 11343(a) and provides in pertinent part:
The following transactions involving carriers providing transportation subject to the jurisdiction of the Interstate Commerce Commission . . . may be carried out only with the approval and authorization of the Commission:
(1) consolidation or merger of the properties or franchises of at least 2 carriers into one corporation for the ownership, management, and operation of the previously separately owned properties.
(4) acquisition of control of at least 2 carriers by a person that is not a carrier.
(5) acquisition of control of a carrier by a person that is not a carrier but that controls any number of carriers.
Section 5(4) now appears at 49 U.S.C. § 11348(a) and provides in pertinent part:
When the Interstate Commerce Commission approves and authorizes a transaction . . . in which a person not a carrier providing transportation subject to the jurisdiction of the Commission . . . acquires control of at least one carrier subject to the jurisdiction of the Commission, the person is subject, as a carrier, to the following provisions of this title that apply ...