J.B. Hunt Transport Services Inc. of Lowell and BNSF Railway Co. of Fort Worth requested the revenue sharing of its Joint Service Agreement be decided by arbitration.
J.B. Hunt said the revenue division of the JSA is negotiated by the two companies and reviewed quarterly. J.B. Hunt said the arbitration will be limited to the revenue collected since May 1, 2016.
J.B. Hunt said the issues for arbitration included the interpretation and application of the confidential contract standards. The division will be reviewed by a panel of arbitrators.
Neither company has requested a review for more than a decade, J.B. Hunt said.
"While this type of proceeding between the parties has been infrequent, and may be lengthy and time consuming, JBHT considers this part of the normal course of business within the long-term relationship," J.B. Hunt said in a release. "Compartmentalizing the proceeding is a more efficient way to facilitate the revenue division determination and will allow both parties to maintain their focus on growing and operating the joint service network."
Intermodal is J.B. Hunt's most dominant segment. It generated slightly less than $3.7 billion in revenue in 2015, which accounted for 59 percent of the company's total revenue; in the first three quarters of 2016, Intermodal had generated revenue of $2.8 billion, up from $2.7 billion in the same three quarters of 2015.
BNSF released a statement that the terms of the JSA as well as the arbitration proceedings are confidential. It said BNSF customers would not be affected by the arbitration.