Shipper’s Interests Protected: Amended Canada Transportation Act Receives Royal Assent

March 03, 2008

OTTAWA — The Honourable Lawrence Cannon, Minister of Transport, Infrastructure and Communities, announced on Friday that Bill C-8 (Act to Amend the Canada Transportation Act (railway transportation) has received Royal Assent.

The Bill consists of amendments to clarify and strengthen provisions that protect rail shippers from the potential abuse of market power by railways. The amendments will help address shipper concerns about rail service and rates, while providing regulatory stability to the railways to encourage investments that are required to keep Canadian exporters and importers competitive in international markets.

“This is such a positive achievement for so many people,” says MP Brian Jean who, as Parliamentary Secretary to the Minister of Transportation, Infrastructure, and Communities, played a leading role in seeing these amendments passed. “These amendments represent the culmination of extensive consultations and reflect the substantial contributions made by stakeholders from across the country,” adds Jean. “They balance the needs of both parties while still allowing our rail transportation system to meet the economic challenges of the future.”

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, as it is an unwarranted barrier to regulatory remedies;
• extending final offer arbitration to groups of shippers on matters relating to rates or conditions for the movement of goods, provided the matter submitted for arbitration is common to all and the shippers make a joint offer that applies to all of them;
• allowing for the suspension of any final offer arbitration process, if both parties consent to pursue mediation;
• permitting the Agency, upon complaint by a shipper, to investigate charges and conditions for incidental services and those related to the movement of traffic contained in a tariff that are of general application, and to establish new charges or terms and conditions if it finds those in the tariff to be unreasonable;
• increasing the notice period for augmentations in rates for the movement of traffic from 20 to 30 days to ensure that shippers receive adequate notice of rate increases;
• 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 the abandonment and transfer provisions apply to lines that are transferred to provincial short lines (local lines under provincial jurisdiction) and subsequently revert to a federal railway, including the obligation to honour contracts with public passenger service providers.
  

In addition, the Government of Canada has committed to commence a review of railway service within 30 days of the Bill receiving Royal Assent. The Government of Canada has been consulting with the shippers and the railways on the scope and terms of reference for this review. Details of the review will be announced in the coming weeks. In the interim, shippers continue to have access to the remedies already available in the Act.