New Federal Law Will Improve Rail Freight Service

Friday, February 29th, 2008

OTTAWA – Federal legislation to enhance the reliability and competitiveness of Canada’s rail freight service became law yesterday when Bill C-8 received Royal Assent. Prince George-Peace River MP Jay Hill said the legislation will enhance rail service for local shippers, including farmers, forest mills and mining companies.

“This legislation was widely support by rail customers in my constituency,” said Hill. “While railway companies, such as CN, are private companies, they are also subject to provisions in the Canada Transportation Act. These amendments clarify and strengthen those federal provisions to protect rail shippers from potential abuse of market power by railways.”

The amendments are the result of extensive consultation by stakeholders across the country and strike a balance between the needs of both shippers and railways. The amendments include:

• Removing the requirement for the Canadian Transportation Agency (the Agency) to be satisfied that a shipper would suffer substantial commercial harm before it grants a remedy;
• Extending final offer arbitration to groups of shippers on common matters relating to rates or conditions for the movement of goods;
• Permitting the Agency, upon complaint by a shipper and subsequent investigation and judgement, to establish new rates or terms and conditions and to increase the notice period for rate increases from 20 to 30 days to ensure that shippers receive adequate notice;
• Requiring railways to publish a list of rail sidings available for grain producer car loadings and to give 60 days notice before removing such sidings from operation; and
• Ensuring that abandonment and transfer provisions apply to lines transferred to provincial short lines that subsequently revert to a federal railway.

In addition, the Government of Canada has made a commitment to commence a review of railway service within 30 days of the Bill receiving Royal Assent. This will include consultation with shippers and the railways on the scope and terms of reference for this review.

“Our Conservative Government managed to pass this long-awaited legislation with one of the smallest minorities in history, something the last majority government did not to,” said Hill. “That’s because this government listens to shippers and understood the need to address their concerns about rail service and rates so that they can be competitive in domestic and international markets.”