difficulties encountered, in each instance AML was eventually able to obtain the movement of its containers within the time limitations imposed by its shipping schedules.

AML has utilized applicant's service under temporary authority, and has found this service excellent. Applicant currently is handling approximately 15 percent of AML's container traffic and about 30 percent of its container traffic moving between Portland and Seattle. The balance of its traffic is being transported by other authorized carriers, including protestants herein. AML avers that the loss of applicant's service would have an adverse affect on its business operations.

PROTESTANTS

The operating authority, equipment, terminal locations, and other specific pertinent data respecting the protestants are set forth in appendix A hereto. In general, the protestants hold motor common carrier authority within the territory proposed to be served by applicant, and are familiar with the transportation of containerized freight. Each protestant operates a fleet of equipment, including flat-bed vehicles suitable for the transportation of containers. Protestants to varying degrees have participated in the movement of containers within the involved territory, and have served two of the firms supporting this application, General Steamship and American Mail Lines. Protestants generally take the position that they are able to adequately meet the public need for motor carrier service in the transportation of containerized freight within the involved territory; that no need has been established on this record for applicant's service; and that, therefore, the application should be denied.

DISCUSSION AND CONCLUSIONS

Public conveninece and necessity.-Pursuant to the provisions of section 207 of the Interstate Commerce Act, an applicant for motor common carrier authority has the statutory burden of showing that the operation it proposes to conduct is or will be required by the present or future public convenience and necessity. In considering whether and to what extent this statutory requirement has been met, we must determine whether the new operation or service will serve a useful public purpose responsive to a public demand or need; whether this purpose can or will be served as well by existing lines or carriers; and whether it can be served by applicant without

endangering or impairing the operations of existing carriers contrary to the public interest, Pan-American Bus Lines Operation, 1 M.C.C. 190, 203 (1936). Applying these criteria to the evidence of record in the instant proceeding, we are of the opinion that said applicant has met the requisite burden of proof to the extent set forth below; and that the application should be granted to the extent and subject to the conditions indicated in our findings below.

In reviewing the evidence presented by the public witnesses and relating to applicant's previous participation in containerized freight movements in the considered territory, we are of the opinion that the broad territorial grant of authority recommended by the joint board is not supported by the record. The evidence of the supporting parties establishes that their container shipments within Oregon and Washington move principally between major port cities. While these parties assert a need for the service of an additional motor carrier authorized to transport containerized freight to inland points in Oregon and Washington, the record is devoid of concrete data as to the volume of traffic moving to specific inland points in these States. The majority of the containerized shipments moving through the Port of Portland move within a 200-mile radius of Portland, and the Port routes only approximately 50 percent of this traffic. Del Monte receives containerized freight at Portland after which it is taken to its distribution center at Vancouver. Its outbound or export shipments originate at Toppenish and move to Seattle or Tacoma. While General Steamship's container traffic has increased, import shipments move primarily through Portland and Seattle, and the evidence specifically demonstrates export traffic originating in western Oregon or Washington at Toppenish, Riddle, Portland, Eugene, Springfield, and Salem. General Steamship indicates specific examples of container movements between the ports of Portland, Astoria, Coos Bay, Seattle, and Tacoma. American Mail regularly serves the following ports either as destinations or origin points: Longview, Vancouver, Seattle, Tacoma, Everett, Port Angeles, Aberdeen, Hoquiam, Portland, Astoria, Rainier, Newport, and Coos Bay. The supporting firms assert generally that inbound traffic moves to points throughout Oregon and Washington, and do not elaborate further on these

movements.

A consideration of applicant's past operations likewise. demonstates a need for a more limited service than that recommended. In analyzing these operations we are aware, as correctly noted by certain protestants, that operations under

temporary authority raise no presumption of a need for corresponding permanent operations, and, standing alone, are insufficient to justify a grant of permanent operating authority. Evidence of past operations under temporary authority is, nevertheless, of probative value to support an application for permanent authority where used to determine the ability of a carrier to provide the proposed service, to indicate the volume of traffic involved, or to ascertain the effect which a grant of authority would have on the operations of existing carriers. See Terminal Transport Co., Inc., Ext.-Michigan Points, 111 M.C.C. 343, 359 (1970); and Roadway Exp., Inc., Ext.-Birmingham, Dallas, Houston, 82 M.C.C. 689, 703 (1960), affirmed sub nom. Herrin Transportation Co., et al. v. United States, 297 F. Supp. 529 (S.D. Tex., 1969).

Applicant has been providing a container service since 1972. Its evidence of past traffic handled for the accounts of the supporting firms herein demonstrates that approximately 90 percent of these movements were between ports, with the exception that the traffic of Del Monte originated at Toppenish. Moreover, a substantial portion of this traffic involved shipments within the commercial zone of Portland or movements between the following ports: Tacoma, Seattle, Vancouver, Longview, and Portland. Applicant's traffic exhibits do not indicate any movements beyond the abovenamed ports to inland points in Washington and Oregon.

In weighing the evidence, we conclude that it has been established that the supporting firms have come to rely upon applicant's service; that there has been an increase in container traffic, and that applicant has been providing a satisfactory service between certain specified points in Oregon and Washington. The record clearly indicates that the continuing rapid growth of exwater containerized traffic moving through the ports of Seattle and Portland has been accompanied by an increasing demand for additional motor carrier service at the major port cities. The evidence fails to substantiate the generally expressed fears of certain protestants that their operations may be materially adversely affected by a diversion of existing traffic if any portion of the instant application is granted. Although several of the protestants handle containerized freight between points here under discussion in the involved areas, there is no indication that the profitability of any opposing carrier's operation has been adversely affected since the inception of applicant's service under temporary authority. In any case, the diversion of existing traffic from protestants, if any, will be minimal, and we do not believe that their operations will be so

impaired as a result of the issuance of authority herein as to prevent them from rendering a responsive service to the public in the future. Accordingly, we conclude that the grant of authority set forth in our findings (which grant is substantially similar to the actual operations applicant has conducted under temporary authority) will not have an adverse effect on the operations of existing carriers. The authority granted here in to transport empty containers will correspond territorially to the general freight authorization, inasmuch as no greater territorial need has been established for the movement of empty containers on this record. In making this determination we have weighed the interest of each of the protesting parties. Many of the protestants are limited to serving specified points in connection with their regular-route operations, and, although they are authorized to serve a number of the points involved, these protestants lack the flexibility to provide a coordinated service in the transportation of the freight and within the territory authorized herein. Mitchell, AAA, and C & H by reason of recent grants of authority can provide the complete service sought to be performed by applicant. However, we believe that the supporting firms' increasing demands for motor carrier transportation of containerized freight between the points set forth in our grant of authority are such as to warrant the authorization of an additional carrier. There presently is, and will continue to be, a sufficient volume of containerized traffic to support the service authorized herein as well as those of existing carriers.

Fitness. In determining a carrier's fitness, consideration must be given to the nature and extent of its unlawful activities, the mitigating circumstances, if any, shown to exist and to have existed, whether the carrier's conduct represents a flagrant and persistent disregard of the provisions of the act, and whether it has made sincere efforts to correct past mistakes. See Pre-Fab Transit Co., Ext.-International Falls, 112 M.C.C. 664, 675 (1970). These considerations are critical, for otherwise the denial of an application on the basis that the carrier is unfit would be a punitive measure, and we strongly emphasize that a denial of an application on the basis of an adverse fitness finding is not a punitive measure directed against the carrier's past unlawful operations, but is rather more in the nature of a prospective safeguard which serves the primary purpose of protecting the public from a carrier which, by its conduct, has not demonstrated a willingness and ability to operate in accordance with the Commission's requirements. See Ritter Trucking Co., Inc., Extension, 111 M.C.C. 771, 776 (1970).

Therefore, a consideration of a carrier's fitness should also include an evaluation of its willingness and ability to comport in the future with the applicable rules and regulations of the Commission. See Armored Carrier Corporation v. United States, 260 F. Supp. 612, 615 (E.D. N.Y. 1966), affirmed per curiam, 386 U.S. 778 (1967). In this proceeding, the evidence demonstrates that during the period from June 29, 1971, through September 7, 1973, applicant conducted a container service pursuant to various grants of emergency temporary authority (ETA) and temporary authority (TA). Applicant's operations which are questioned by protestants involve those periods of time when it is alleged that the abovenoted authorities had expired and applicant had not received an extension of its ETA or TA. In considering these questioned operations, it is clear that applicant at all times operated in a good faith, although perhaps mistaken, belief that the movements were either authorized or not subject to economic regulation by the Commission. In examining these periods in more detail, it is apparent there is some confusion on protestants' part inasmuch as certain of the questioned operations were apparently performed under the exemption from economic regulation provided by section 202(c)(2) of the Interstate Commerce Act as local pickup and delivery service, within terminal areas, in connection with prior and subsequent line-haul movements of the involved freight by other motor carriers subject to part II of the act. Other movements during this period involved the transportation of agricultural commodities, such as feather meal and peas which are exempt from economic regulation under the provisions of section 203(b)(6) of the act.

The record indicates that applicant has been under the impression that the transportation of general freight having a prior or subsequent movement by water between points in a municipality's commercial zone, including that municipality, by a motor common carrier, where operations are otherwise subject to regulation under the Interstate Commerce Act, is exempt from regulation. Local motor carrier pickup and delivery services performed in connection with carriers not subject to the Interstate Commerce Act (such as maritime carriers) are not exempt from regulation even though such transportation takes place wholly within a single commercial zone'

As here pertinent, section 203(b)(8) of the act exempts from economic regulation transportation of property by motor vehicle, in interstate or foreign commerce, which is performed wholly within a municipality or between contiguous municipalities or within a zone adjacent to and commercially a part of any such municipality or municipalities, but it contains an exception where the local transportation involved is under "a common control, management, or arrangement" for through transportation to or from a point outside such municipality, municipalities, or zone.