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CN calls freight service legislation unnecessary risk to system

Canada’s largest railway says the introduction of new freight service regulations that include fines is an unnecessary intrusion that puts the engine of the country’s economic growth at risk.

“Such an approach would stifle innovation, chill the positive service momentum that’s taken hold and result in potentially unintended consequences for the rail industry and the customers we serve,” CN president and chief executive Claude Mongeau said Tuesday after the federal government tabled a long-awaited legislation.

He said there is no evidence of systematic rail service performance problems in Canada that warrants Ottawa’s intervention to level the playing field with shippers who have long complained about poor service.

“The objective fact is that Canada has a world-class rail system, one known internationally for efficiency and reliability — a key asset for a trading nation like Canada — and that reflects a well-functioning market for rail services.”

Amendments to the Canada Transportation Act were announced Tuesday in Winnipeg by Transport Minister Denis Lebel and Agriculture Minister Gerry Ritz.

The changes follow a five-year review of service provided to shippers such as grain handlers, miners and manufacturers by federally regulated railways such as Canadian National Railway (TSX:CNR) and Canadian Pacific Railway (TSX:CP).

Lebel said legislation gives shippers the right to an arbitrated service agreement if negotiations with the railway fail.



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