Canada Transportation Act (S.C. 1996, c. 10)

Act current to 2016-06-06 and last amended on 2015-07-30. Previous Versions

Competitive Line Rates

Marginal note:Application
  •  (1) Sections 130 to 136 apply where

    • (a) a shipper has access to the lines of only one railway company at the point of origin or destination of the movement of the shipper’s traffic; and

    • (b) a continuous route between those points is operated by two or more companies.

  • Marginal note:Transferred railway lines

    (2) For greater certainty, the transfer of a railway line, or an operating interest in it, under Division V or section 158 of the National Transportation Act, 1987 does not affect the right of a shipper to obtain a competitive line rate under sections 130 to 136.

Marginal note:When competitive line rate to be established on shipper’s request
  •  (1) Subject to section 131, the local carrier serving the shipper at the point of origin or destination, as the case may be, shall, on the request of the shipper, establish a competitive line rate applicable to the movement of the traffic between the point of origin or destination, whichever is served exclusively by the local carrier, and the nearest interchange with a connecting carrier.

  • Marginal note:Requirement unaffected by extent of carrier’s capability

    (2) The local carrier shall establish the competitive line rate even if it is able to move the traffic over the whole of the continuous route or a portion of that route that is longer than the portion in respect of which the competitive line rate is to apply.

  • Marginal note:Designation of route by shipper

    (3) The shipper may designate the continuous route for the movement of the shipper’s traffic from the point of origin to the point of destination.

  • Marginal note:Route within Canada

    (4) If the ultimate point of destination of a movement of the shipper’s traffic is in Canada, the shipper shall designate a route wholly within Canada, unless there is no cost-effective continuous route wholly within Canada that is available to the shipper and over which it is reasonable to move the shipper’s traffic.

  • Marginal note:Export and import

    (5) For the purposes of this section,

    • (a) if the point of destination of a movement of traffic is a port in Canada for export out of Canada, that port is the ultimate point of destination in Canada; and

    • (b) if the point of origin of a movement of traffic is a port in Canada for import into Canada, that port is the point of origin.

  • Marginal note:Nearest interchange

    (6) For the purposes of subsection (1), the nearest interchange is the one nearest the point of origin or destination, whichever is served exclusively by the local carrier, in the reasonable direction of the movement of the traffic from the point of origin to the point of destination on the continuous route designated by the shipper, unless the local carrier can demonstrate that the interchange cannot be used for engineering reasons.

Marginal note:Shipper and connecting carriers must agree
  •  (1) A competitive line rate must not be established unless the shipper agrees with the connecting carrier, and with any other company, other than the local carrier, that moves traffic over a portion of the continuous route, on the terms and conditions governing their movement of the traffic, including the applicable rate.

  • Marginal note:No other rate applies

    (2) If an interswitching rate determined under paragraph 128(1)(b) is available for a portion of the route operated by the local carrier, no other rate may be applied to that portion of the route.

  • Marginal note:Movement on flat cars or less than carload traffic

    (3) A competitive line rate must not be established for the movement of trailers on flat cars, containers on flat cars or less than carload traffic, unless they arrive at a port in Canada by water for movement by rail or by rail for movement by water.

  • Marginal note:Maximum portion of traffic

    (4) The portion of a movement of traffic in respect of which a competitive line rate may be established must not exceed 50 per cent of the total number of kilometres over which the traffic is moved by rail or 1 200 km, whichever is greater.

  • Marginal note:Exception

    (5) On application of a shipper, the Agency may establish a competitive line rate for a greater portion of a movement of traffic if the Agency is satisfied that no interchange exists within the maximum portion referred to in subsection (4).

  • Marginal note:No other rates may be established

    (6) If a competitive line rate has been established for a movement of traffic of a shipper, no other competitive line rate may be established in respect of that movement while the rate is in effect.

Marginal note:Application to Agency to establish competitive line rates
  •  (1) On the application of a shipper, the Agency shall, within forty-five days after receiving the application, establish any of the following matters in respect of which the shipper and the local carrier do not agree:

    • (a) the amount of the competitive line rate;

    • (b) the designation of the continuous route;

    • (c) the designation of the nearest interchange; and

    • (d) the manner in which the local carrier shall fulfil its service obligations.

  • Marginal note:No final offer arbitration

    (2) If a matter is established by the Agency under this section, the shipper is not entitled to submit the matter to the Agency for final offer arbitration under section 161.

Marginal note:Competitive line rate
  •  (1) A competitive line rate in respect of the movement of traffic of a shipper is the result obtained by applying the following formula:

    A + (B/C × (D - E))

    where

    A 
    is the amount resulting from the application of the interswitching rate;
    B 
    is the total revenue that the local carrier received in respect of all movement over its lines of railway
    • (a) of traffic that

      • (i) is the same as or substantially similar to, the traffic moved, and

      • (ii) is moved over similar distances, unless no such traffic is moved over similar distances; and

    • (b) during the most recent period designated by the local carrier or any other period determined by the Agency, if the Agency determines that the designated period is not appropriate in the circumstances;

    C 
    is the total number of tonne kilometres of the movement of traffic that generated the total revenue;
    D 
    is the number of kilometres over which the competitive line rate is to apply; and
    E 
    is the total number of kilometres to which the interswitching rate is applicable.
  • Marginal note:Adjustment of rate

    (2) If a shipper performs any of the activities in respect of which an interswitching rate is applicable, the applicable interswitching rate in the description of A in the formula must be adjusted to account for the performance of those activities.

  • Marginal note:Alternative determination

    (3) The Agency may make an order in respect of a particular shipper or railway company, or make regulations that apply generally to shippers or railway companies, establishing an alternative method of determining the amount of a competitive line rate if the amount cannot be determined in accordance with this section.

  • Marginal note:Rate must be compensatory

    (4) A competitive line rate determined under this section must not be less than the variable costs of moving the traffic, as determined by the Agency.

Marginal note:Rate to be included in tariff or confidential contract

 A competitive line rate must be set out in a tariff or confidential contract.

Marginal note:Effective period of rate

 If a competitive line rate is established by the Agency, it has effect for one year after its effective date, or for any other period that the shipper and the local carrier agree on.

Marginal note:Obligation of carriers to provide cars
  •  (1) If a competitive line rate is established, a railway company, other than the local carrier, shall provide the shipper with an adequate supply of cars for the traffic being moved.

  • Marginal note:Additional obligations

    (2) Subject to any agreement to the contrary between the local carrier and any connecting carrier concerned, the connecting carrier is responsible for

    • (a) a prorated share, determined in accordance with subsection (3), of the costs of operating and maintaining the interchange during the period in respect of which the competitive line rate is in effect; and

    • (b) the capital cost of making any change or addition to the interchange that may be necessary for transferring the traffic for which the competitive line rate is established.

  • Marginal note:Determination of prorated share

    (3) The prorated share is the proportion that

    • (a) the competitive line rate traffic transferred at the interchange during the period

    is of

    • (b) the total traffic transferred at the interchange during the period.

  • Marginal note:Tariff to set out service obligations

    (4) The tariff setting out a competitive line rate must set out the manner in which the local carrier issuing the tariff shall, subject to subsection (1), fulfil its service obligations

    • (a) as agreed on by the shipper and the local carrier, if they agree on the amount of the competitive line rate; or

    • (b) as determined by the Agency, if the amount of the competitive line rate is established by the Agency under section 132.

 
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