Rail transportation carries about 40 percent of long-distance ton-miles in the United States according to the Association of American Railroads. It remains one of the most cost-efficient ways to move bulk commodities and heavy freight, but for many shippers, being served by only one carrier limits options, raises costs, and reduces flexibility. The Surface Transportation Board’s EP711 Reciprocal Switching initiative was designed to change that.
What is EP711 and where it stands today
Reciprocal switching is a regulatory provision that allows a shipper served by a single railroad to request that their freight be transferred to a competing railroad at an interchange point. This arrangement can give shippers competitive pricing, alternative routing, and better service performance without building new physical track connections.
The current rulemaking under Docket No. EP711 (Sub-No. 2) began on September 7, 2023, when the STB issued a Notice of Proposed Rulemaking focusing on service inadequacy as the trigger for switching access. Initial comments were due October 23, 2023, later extended to November 7, with reply comments accepted until December 6, 2023 ( STB.gov).
On April 30, 2024, the STB adopted a final rule establishing objective service metrics. These included maintaining on-time performance above 70 percent, keeping transit time consistency within a 20 percent year-over-year change, and achieving at least 85 percent success on first-mile/last-mile reliability. The rule was set to take effect in early September 2024, 120 days after Federal Register publication.
However, in July 2025, the Seventh Circuit Court of Appeals vacated the rule, ruling that the STB had exceeded its authority by not requiring a formal finding of inadequate service before granting reciprocal switching. This legal challenge has put the future of EP711 in question, meaning shippers and 3PLs must prepare for continued uncertainty.
Why the proposal mattered for shippers and 3PLs
For the supply chain logistics community, EP711 promised to reshape carrier negotiations, rail routing strategies, and distribution planning. More carriers mean more routing choices to avoid congested lines or offset delays. The USDA noted that agricultural shippers served by only one carrier can pay 20 to 30 percent more than those with competitive access, and competition could bring those costs down. During the 2014–2015 congestion crisis, shippers lost an estimated 8 billion dollars in potential sales due to late or missed deliveries, showing why alternate routing options are essential.
Facilities in the nationwide warehousing network with sidings or access to intermodal yards are well positioned to benefit if competitive switching returns in any form. Nearly 80 percent of U.S. manufacturing output is located within 250 miles of a rail-served facility according to the Bureau of Transportation Statistics, and expanded carrier access could make those locations more attractive to shippers seeking cost savings and flexibility.
Stakeholder voices and industry conversations
The National Industrial Transportation League (NITL), representing shipper interests, supported the push for objective service standards but criticized the final rule for limiting relief to inadequate service cases. Many shippers operate under contracts exempt from STB oversight, meaning they might still lack competitive options ( NITL press release).
The USDA submitted formal comments during the proposal phase urging the STB to also consider competition-driven triggers, not just service metrics. The agency pointed to the 2022 rail service crisis and argued that shippers need both service reliability and market choice.
The Department of Transportation and Federal Railroad Administration weighed in with safety-focused guidance, noting that any expansion of reciprocal switching must safeguard passenger rail schedules and avoid bottlenecks at critical junctions.
Industry media like Railway Age hosted a point-counterpoint discussion on whether service metrics were the best way to achieve reform. Some argued that while the metrics offer clarity, they sidestep the deeper issue of increasing overall competition. Others said metrics provide a manageable framework and avoid overloading the network with disputes over competition access.
The recent court ruling adds yet another twist, as the vacated rule means shippers must continue to work within the existing framework while monitoring legal developments.
How to prepare in a shifting policy landscape
Even without an active EP711 rule, the discussions it sparked can guide strategic planning. Shippers with rail-served facilities should identify nearby interchange points and evaluate which carriers could be accessed if future rules revive competitive switching. Working with 3PL warehouse companies that have multi-carrier coordination experience ensures you can move quickly when opportunities arise.
Key preparation questions:
• Which interchange points are closest to our facilities
• How would expanded carrier access impact freight rates and service windows
• Can our network footprint be rebalanced for better speed-to-market
• Does our warehouse partner have the systems to manage multiple rail carrier schedules and billing
By tracking policy developments and keeping relationships with experienced warehousing and logistics providers, you can position your supply chain to capture the benefits of competitive switching if it returns in a future rule.
ABOUT ACWI: The American Chain of Warehouses, Inc. (ACWI) is a nationwide network of third-party logistics providers offering warehousing services, distribution management, and fulfillment solutions across the United States. For shippers, ACWI makes it simple to find trusted third-party logistics providers with strategic warehouse locations to handle value added logistics, pick and pack services, food-grade warehousing, and rail-served distribution facilities.
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