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Opinion of the Court.

tioned to remove any such discriminations found to exist in a proper proceeding. This means that such discriminations as those mentioned which result from differences in the methods of distributing the general rate burden in the several rate-making territories, or from any other cause, if not justified upon proper consideration of recognized elements of rate making applied in the light of the amended law are unlawful and should be corrected." 262 I. C. C. p. 692.

From this statement it is apparent that the Commission concluded that the 1940 amendment to §3 (1) enlarged the scope of the section. The Commission, indeed, stated that "it is clear that the main purpose which Congress had in mind was to bring about a greater degree of equalization, harmony, and uniformity in the different regional or territorial rate structures of the country." Id. p. 692. And see id. pp. 688-691. But it is suggested that discriminations based on geographic factors were outlawed prior to the 1940 amendment to § 3 (1), as evidenced by its long-standing condemnation of "undue or unreasonable prejudice or disadvantage" to any "locality" and, since 1935, to any "port, port district, gateway, transit point." It is, moreover, suggested that even the prohibition of discriminations against shippers was broad enough all along to ban discriminations based on the geographic location of the shippers. The contention is that without a change in the law the present orders were unwarranted; it is pointed out that the class rates now condemned had been found by the Commission itself to be just and reasonable in recent years. And it is asserted

14

14 It is pointed out in this connection that Texas & Pacific R. Co. v. United States, supra, while holding that a port was not a "locality" when it was only a gateway through which shipments were made, recognized that a port was a "locality" when it was a point of origin or destination. 289 U. S. p. 638.

that the Commission did not take its present action on a showing of changed circumstances since those times. The conclusion, therefore, is that the present orders are not warranted by § 3 (1).

We need not determine whether, prior to the 1940 amendment, § 3 (1), by its ban on unlawful discriminations against a "locality," would have permitted the Commission to eradicate regional discriminations in class rates. For whatever doubt may have existed in the law was removed by the 1940 amendment which made abundantly clear that Congress thought that the problem of regional discriminations had been neglected and that, if any such discriminations were found to be present, they should be eradicated.15 But, as the Commission concedes, the addition of "region, district, territory" to § 3 (1) did not change the law respecting discrimination by authorizing uniform freight rates, mile for mile, without regard to differing costs of the service. Congress, by adding those words, made plain the duty of the Commission, in determining whether discriminatory practices exist, to consider the interests of regions, districts, and territories, and to eliminate territorial rate differences which are not justified by differences in territorial conditions. In other words Congress did not introduce a new standard of discrimination by its amendment to § 3 (1); it merely made clear its purpose that regions, districts, and territories should be the beneficiaries of the law against discrimination.

15 Senator Wheeler who had charge of the bill on the floor of the Senate stated concerning the amendment to § 3 (1): "The previous provision with regard to 'discrimination' simply referred to discrimination as to locality, port, port district, gateway, transit point' without specifying the region, district, or territory. So we felt that by broadening the language we would at least take away that excuse, and we would provide expressly that the Commission should not discriminate in its rate structures." 84 Cong. Rec., p. 5889.

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Opinion of the Court.

Second. It is argued, however, that the findings of the Commission concerning regional discriminations in class rates are not supported by substantial evidence.

The great differences betwen territorial class rate levels are shown by the following table. It gives a comparison (in cents per 100 pounds) between the first-class rate scale within Official Territory and that within each of the other territories:

These first-class intraterritorial rates are used as bases in formulating rates on other classes of freight in the respective territories.18

The following tables compiled by Government counsel show the first-class rates for interterritorial movements to Official Territory from each of the other territories as compared with intraterritorial movements for approximately equal distances within Official Territory:

16 See note 2, supra.

The disadvantage to the Southern or Western shipper who attempts to market his product in Official Territory is obvious. Thus the first of these tables shows that a Nashville shipper pays 39 cents more on each 100 pounds of freight moving to Indianapolis, Indiana than one who ships from Indianapolis to a point of substantially equal distance away (Kent, Ohio) in Official Territory. Similar disadvantages suffered by Southern and Western shippers are revealed in the other comparable interterritorial freight movements set forth in the tables.

That disadvantage is emphasized if the effects of classification differences on rates for identical commodities are considered. A comparison of rates in cents per 100 pounds for 200 miles shows that, even though shippers in the South and West have the same or lower classification ratings for identical commodities, they nevertheless on the whole pay higher charges than the shippers in Official Territory for equivalent service. Thus there are in class 100 (first class) for less-than-carload lots 2092 items