Transnet and the South African Rail Commuter Corporation (SARCC) were formed on April 1, 1990. Before the consolidation Metrorail was one of the business units of Transnet. Metrorail came into being after the commuter function removed from Transnet and moved into SARCC to allow Transnet to focus on profit oriented commercialised railway operations. SARCC, as a subsidised public organisation, focused on fulfilling the government's social obligation by providing affordable commuter services.
To overcome the problems of an unfocused business approach at Metro, and to enable the SARCC to properly manage expenditure and income, a decision was then taken to separate the Metro division from SARCC.
Metrorail was then repositioned as a business unit under Spoornet in the early 90s. The relationship between the SARCC (the principal) and Spoornet (the agent) was governed by a business agreement. But on January 01, 1997, Metrorail became an independent unit within the Transnet group and Metrorail regions were then established thereafter.
Metrorail lost its independence in 2006 when it was transferred into the SARCC by the Minister of Transport through the consolidation process. The commuter rail service is now provided by Metrorail, SARCC’s operational arm, in accordance with the Legal Succession Act to SATS Act. Through Metrorail, SARCC ensures that, at the request of the National Department of Transport or any sphere of government, rail commuter services are provided in the public interest, in addition to promoting commuting by rail as the primary mode of mass commuter transportation.