Vol. 148, No. 7 — March 26, 2014

Registration

SOR/2014-55 March 7, 2014

CANADA TRANSPORTATION ACT

Order Imposing Measures to Address the Extraordinary Disruption to the National Transportation System in Relation to Grain Movement

P.C. 2014-274 March 7, 2014

Whereas the Governor in Council is of the opinion that an extraordinary disruption to the effective continued operation of the national transportation system, other than a labour disruption, exists;

Whereas the Governor in Council is of the opinion that a failure to act under section 47 of the Canada Transportation Act (see footnote a) at this time would be contrary to the interests of users and operators of the national transportation system;

And whereas the Governor in Council is of the opinion that there are no other provisions in that Act or in any other Act of Parliament that are sufficient and appropriate to remedy the situation and counter the anticipated damage that would be caused by the disruption;

Therefore, His Excellency the Governor General in Council, on the recommendation of the Minister of Transport, and of the Minister of Industry in the Minister’s capacity as the minister responsible for the Competition Bureau, pursuant to section 47 of the Canada Transportation Act (see footnote b), makes the annexed Order Imposing Measures to Address the Extraordinary Disruption to the National Transportation System in Relation to Grain Movement.

ORDER IMPOSING MEASURES TO ADDRESS THE EXTRAORDINARY DISRUPTION TO THE NATIONAL TRANSPORTATION SYSTEM IN RELATION TO GRAIN MOVEMENT

Definitions

1. The following definitions apply in this Order.

“grain”
« grain »

“grain” means any grain, crop or product listed in Schedule II to the Canada Transportation Act.

“move”
« transporter »

“move” means to carry grain over a railway line from a point on any rail line west of Thunder Bay or Armstrong, Ontario, to any point in Canada or the United States or beyond for unloading.

Measures

2. Subject to volume demand and corridor capacity, the Canadian National Railway Company and the Canadian Pacific Railway Company must each move the following minimum amounts of grain:

Reporting

3. The Canadian National Railway Company and the Canadian Pacific Railway Company must provide the Minister of Transport with a report indicating the weekly volume demand and the volumes of grain moved in each corridor, within one week after the end of a crop week.

Effective period

4. This Order is effective for a period of 90 days after the day on which the Order comes into force.

Coming into force

5. This Order comes into force on the day on which it is registered.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Order.)

Background

Throughout fall 2013, railway companies were moving efficiently; however, since December, extremely cold temperatures and winter conditions have affected normal railway operations (i.e. reduced train lengths by up to 30% and limited frequencies). As a consequence, railway companies have not been able to fulfill shippers’ car orders. In addition, Western Canada grain farmers have produced a record of 75.8 million metric tonnes of grain this year.

The inability of the railway company to move normal numbers of loaded hopper cars has created an extraordinary disruption to the effective and continued operation of the national transportation system, and compromising the ability of Canadian grain to access markets in Canada and beyond.

Objectives

The objective of the Order, pursuant to section 47(1) of the Canada Transportation Act, is to stabilize the national transportation system, and, specifically, to ensure the ability of the transportation system to move grain to market in a timely manner.

Description

This Order requires, subject to volume demand and corridor capacity, that Canadian National Railway Company (CN) and Canadian Pacific Railway Company (CP) carry a minimum number of metric tonnes of grain each, from a point on any railway line west of Thunder Bay or Armstrong, Ontario, to any point in Canada or the United States or beyond for unloading

The Order also requires that within one week of the end of a crop week that CN and CP must report to the Minister of Transport the following information:

The Order comes into force on the day it is made and is effective for 90 days.

“One-for-One” Rule

A carve-out of the “One-for-One” Rule is permissible based on the unique, exceptional, and extenuating circumstances to stabilize the national transportation system as per the objectives of this proposed Order under section 47 of the Canada Transportation Act.

Small business lens

The small business lens does not apply to this proposal, as there are no costs on small business.

Consultation

The Minister of Transport, in cooperation with the Minister of Agriculture, has been meeting with implicated stakeholders, including grain companies and railway companies to discuss the problems that have impacted the effective and continued operation of the national transportation system and to discuss possible solutions.

Rationale

There are no suitable alternatives to achieve the objective noted above and resolve this disruption in a timely fashion.

Not proceeding with this Order would have a detrimental impact on many users and operators of the national transportation system, including

Not proceeding with this Order would have a detrimental impact on many users and operators of the national transportation system, and it would cause harm to Canada’s global reputation for reliable transportation, recognizing that

Implementation, enforcement and service standards

Subsection 47(8) provides that persons who contravene an order made under section 47 may be found guilty of an offence and liable on summary conviction

for each day the person contravenes the order.

Contact

Carolyn Crook
Director
Rail Policy
Surface Freight Policy
Place de Ville, Tower C, 27th Floor
Ottawa, Ontario
K1A 0N5
Telephone : 613-998-1918
Fax : 613-998-2686
Email : Carolyn.Crook@tc.gc.ca