Shippers positive about new rail grain transport act

by MM&D Online Staff

OTTAWA, ON—The Minister of Agriculture and Agri-food tabled Bill C-30, the Fair Rail for Grain Farmers Act, in the House of Commons last week.  It is designed to address the current backlog of grain and assist other rail shippers obtain a reasonable definition of service from their rail carriers. While the serious backlog of grain is the driving force for Bill C-30, several provisions of the Bill will apply to other rail shippers.

Bill C-30 builds, to some extent, on the Fair Rail Service Act passed in June 2013.  C-30 provides for the Canadian Transportation Agency to give more specificity to the operational terms that should be included in Service Level Agreements (SLAs).  The Fair Rail Service Act gives shippers the right, for the first time in Canadian law, to some reasonable definition of service, and provides that if this cannot be successfully negotiated directly with the railway, the shipper can obtain a SLA through arbitration.  The proposed regulations may assist shippers in that process.

“Rail Service consistency and quality is not just a western Canadian problem, but a problem for shippers in all parts of the country”, said Bob Ballantyne, president of the shippers’ group Freight Management Association of Canada (FMAC), “and it is important that government actions now begin to focus on the longer term needs of all rail shippers for reliable rail service”.

In addition, Bill C-30 provides for a major change to the “regulated interswitching” provisions of the Canada Transportation Act.  This provision is a surrogate for competition by giving shippers served by only one railway access to a competing railway where there is an interchange between two federally regulated railways within 30 km of the origin (or destination) point.  Bill C-30 will, if passed, give the Canadian Transportation Agency the right to increase the distance to which interswitching may apply.  The government has signaled its policy will be to extend the regulated interswitching limit to 160 km in the Prairie Provinces for all shippers.

According to FMAC, from an early reading of Bill C-30, it appears that the government is sensitive to the needs of other industries.  It is critically important that government actions eventually lead to adequate rail capacity to effectively serve all industries that depend on rail.

The Freight Management Association of Canada (formerly CITA) has been representing the freight transportation interests of Canadian industry to all levels of government and to international agencies since 1916.

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