The south end of the Chilean broad gauge
Agreement – Ernesto Barros Jarpa & Carlos M Noel, 1922
The Governments of the Republic of Chile and the Argentine Republic have reciprocally resolved to construct two lines of railway, which will join each other without transshipment: first, in the north, the Chilean port of Antofagasta with the Argentine city of Salta and immediately, in the south, the Argentine port of Bahía Blanca by the extension of the Southern Railway from Zapala (Argentina) to its junction with the Chilean Red Sur, as well as leaving them completed and in a condition that such lines may provide services within three years of the ratification of this agreement, believe that the time has arrived to establish norms which define and direct the interoceanic railway policy. As a consequence, the following fundamental bases are established for the tariff regime for the transport of goods on the lines to be built.
FIRST. In view of the reason for the building of the lines mentioned, the basis for the calculation of minimum tariffs for goods and livestock shall be the true cost per unit of work, or that is, by net kilometre-ton of transport; that is to say the cost of working only with no charge for capital expended.
When, for a common interest, an exception has to be made to the previous norm, be it for the movement of surplus raw materials, or for the development of certain products, on a specific route, the case shall be the subject of a special agreement of limited duration.
SECONDLY. In each case, and in accordance with a study and exact determination of the conditions of production of the distinct articles, the subject of the traffic, of its costs of production and the sale prices in the consumers' market, taking into account the margins which must be achieved by the producer, the general or basic tariffs will be fixed in a form so that the increase over the minimum tariff which it represents, reconciles the interests of the railway as a transport undertaking with its essential purpose, leaving possible some margin of repayment of the capital employed, but without creating in any instance obstacles for the commerce or industry which the transport is a concurrent factor of progress for the same.
THIRDLY. The tariffs, established with the criterion defined in the previous clause, will always be of an elastic nature in the sense that their application will be subordinate to the possibility of modifications resulting in any case from the production at a given time. This elasticity must allows reductions or increases, temporary or permanent, which allow adaptation of the tariffs conveniently and easily to the different situations which may arise, always maintaining the high economic and social mission of the international lines.
FOURTHLY. The tariffs will normally be the same for the goods destined for the terminal or intermediate points on the lines. Uniquely, special tariffs may be established for those cases in which local production determines the necessity for means of development, and in such cases, they will search, if appropriate, reciprocal compensation.
In other cases, and when there is no conflict of interests, from this point of view, the tariffs should always be towards promoting the intensification of the general traffic, which at the same time will develop the respective productive areas, will contribute towards the progress and development of the terminal ports.
FIFTH. The rolling stock for the traffic common to the Chilean and Argentine sections will be of such a type that its usage may be carried-out with safety, and without any modification whatsoever, on all sections of the two international lines of the same gauge.
To this effect, an agreement will be entered into of a special technical nature, dealing with the adoption of a common loading gauge, rail sections, tyres, couplings, brakes, etc.
The interchange of rolling stock shall apply the norms established to that effect by the Berne Convention for central European railways, and with respect to the payments, which this interchange might generate, this shall be settled on the basis of the wagon-day and in no instance by mileage.
The Chilean and Argentine Governments shall agree opportunely the necessary regulations and the detailed application of this agreement.
The present agreement will be ratified, and the ratifications will be exchanged in this capital as soon as possible.
In good faith the undersigned, the Minister of Foreign Affairs of Chile, and the Special Envoy, the Plenipotentiary Minister of the Argentine Republic in Chile, respectively, are duly authorized to sign and seal two copies of this agreement in Santiago this twenty fifth of April 1922. (Signed)— ERNESTO BARROS JARPA.—CARLOS M. NOEL.