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

Marginal note:Compliance with steps for discontinuance

• 142 (1) A railway company shall comply with the steps described in this Division before discontinuing operating a railway line. The railway company shall publish and keep up to date on its Internet site or the Internet site of an association or other entity representing railway companies a report that sets out the date that it commenced and completed each step.

• Marginal note:Limitation

  (2) A railway company shall not take steps to discontinue operating a railway line before the company’s intention to discontinue operating the line has been indicated in its plan for at least 12 months.

• Marginal note:Exception

  (2.1) Subsection (2) does not apply to a railway company that is the subject of proceedings under the Companies’ Creditors Arrangement Act or the Bankruptcy and Insolvency Act.

• Marginal note:Community-based groups

  (3) Subsection (2) does not apply and a railway company shall without delay take the steps described in section 143 if

  • (a) the federal government, a provincial, municipal or district government or a community-based group endorsed in writing by such a government has written to the company to express an interest in acquiring all or a portion of a grain-dependent branch line that is listed in Schedule I for the purpose of continuing to operate that line or portion of a line; and

  • (b) that line or portion of a line is indicated on the company’s plan as being a line or a portion of a line that the company intends to take steps to discontinue operating.

Marginal note:Advertisement of availability of railway line for continued rail operations

• 143 (1) The railway company shall advertise the availability of the railway line, or any operating interest that the company has in it, for sale, lease or other transfer for continued operation and its intention to discontinue operating the line if it is not transferred.

• Marginal note:Content of advertisement

  (2) The advertisement must include a description of the railway line and how it or the operating interest is to be transferred, whether by sale, lease or otherwise, and an outline of the steps that must be taken before the operation of the line may be discontinued, including

  • (a) a statement that the advertisement is directed to persons interested in buying, leasing or otherwise acquiring the railway line, or the railway company’s operating interest in it, for the purpose of continuing railway operations; and

  • (b) the date by which interested persons must make their interest known in writing to the company, but that date must be at least sixty days after the first publication of the advertisement.

• Marginal note:Disclosure — advertisement

  (3) The advertisement shall also disclose

  • (a) the existence of any agreement between the railway company and a public passenger service provider in respect of the operation of a passenger rail service on the railway line; and

  • (b) an indication as to whether or not section 96 applies to the land on which that railway line is located.

• (4) [Repealed, 2007, c. 19, s. 36]

Marginal note:Disclosure of process

• 144 (1) The railway company shall disclose the process it intends to follow for receiving and evaluating offers to each interested person who makes their interest known in accordance with the advertisement.

• (2) [Repealed, 2007, c. 19, s. 37]

• Marginal note:Negotiation in good faith

  (3) The railway company shall negotiate with an interested person in good faith and in accordance with the process it discloses and the interested person shall negotiate with the company in good faith.

• Marginal note:Net salvage value

  (3.1) The Agency may, on application by a party to a negotiation, determine the net salvage value of the railway line and may, if it is of the opinion that the railway company has removed any of the infrastructure associated with the line in order to reduce traffic on the line, deduct from the net salvage value the amount that the Agency determines is the cost of replacing the removed infrastructure. The party who made the application shall reimburse the Agency its costs associated with the application.

• Marginal note:Time limit for agreement

  (4) The railway company has six months to reach an agreement after the final date stated in the advertisement for persons to make their interest known.

• Marginal note:Decision to continue operating a railway line

  (5) If an agreement is not reached within the six months, the railway company may decide to continue operating the railway line, in which case it is not required to comply with section 145, but shall amend its plan to reflect its decision.

• Marginal note:Declaration

  (5.1) If an agreement is reached, including an agreement entered into to in accordance with an order by the Agency, the railway company shall provide a written declaration to the person to whom the railway line or the operating interest is being sold, leased or otherwise transferred, stating that the sale, lease or transfer is in compliance with section 96. It shall also send a copy of the declaration to the Minister.

• Marginal note:Remedy if bad faith by a railway company

  (6) If, on complaint in writing by the interested person, the Agency finds that the railway company is not negotiating in good faith and the Agency considers that a sale, lease or other transfer of the railway line, or the company’s operating interest in the line, to the interested person for continued operation would be commercially fair and reasonable to the parties, the Agency may order the railway company to enter into an agreement with the interested person to effect the transfer and with respect to operating arrangements for the interchange of traffic, subject to the terms and conditions, including consideration, specified by the Agency.

• Marginal note:Remedy if bad faith by an interested person

  (7) If, on complaint in writing by the railway company, the Agency finds that the interested person is not negotiating in good faith, the Agency may order that the railway company is no longer required to negotiate with the person.

Marginal note:Rights and obligations under passenger service agreements continued

• 144.1 (1) If a railway line, or a railway company’s operating interest in a railway line, is sold, leased or otherwise transferred under subsection 141(3) or as the result of an advertisement under subsection 143(1) and, before the day such advertisement was made, an agreement was in force between the railway company and a public passenger service provider in respect of the operation of a passenger rail service on the railway line, the rights and obligations of the railway company under the agreement in respect of the operation of that service on that line vest, as of the day the transfer takes place, in the person or entity to which the railway line, or the operating interest, is transferred, unless the public passenger service provider indicates otherwise before that day.

• Marginal note:Declaration that line is for general advantage of Canada

  (2) Whenever a railway company’s rights and obligations under an agreement with VIA Rail Canada Inc. are vested in another person or entity by subsection (1), the portion of the railway line to which the agreement relates is hereby declared, as of the day the transfer takes place, to be a work for the general advantage of Canada.

• Marginal note:Duration of declaration

  (3) The declaration referred to in subsection (2) ceases to have effect if

  • (a) VIA Rail Canada Inc. ceases to operate a passenger rail service on the portion of railway line to which the declaration relates; or

  • (b) the operation of the railway line is discontinued.

Marginal note:Offer to governments

• 145 (1) The railway company shall offer to transfer all of its interest in the railway line to the governments and urban transit authorities mentioned in this section for not more than its net salvage value to be used for any purpose if

  • (a) no person makes their interest known to the railway company, or no agreement with an interested person is reached, within the required time; or

  • (b) an agreement is reached within the required time, but the transfer is not completed in accordance with the agreement.

• Marginal note:Disclosure — offer

  (1.1) The offer shall disclose whether or not section 96 applies to the land on which that railway line is located, and if the information described in paragraphs 141(2.2)(a) and (b) has not yet been provided to the Minister, the railway company shall provide it to the Minister with the offer.

• Marginal note:Which governments receive offer

  (2) After the requirement to make the offer arises, the railway company shall send it simultaneously

  • (a) to the Minister if the railway line passes through

    • (i) more than one province or outside Canada,

    • (ii) land that is or was a reserve, as defined in subsection 2(1) of the Indian Act,

    • (iii) land that is the subject of an agreement entered into by the railway company and the Minister for the settlement of aboriginal land claims, or

    • (iv) a metropolitan area;

  • (b) to the minister responsible for transportation matters in the government of each province through which the railway line passes;

  • (c) to the chairperson of every urban transit authority through whose territory the railway line passes; and

  • (d) to the clerk or other senior administrative officer of every municipal or district government through whose territory the railway line passes.

• Marginal note:Time limits for acceptance

  (3) Subject to subsection 146.3(3), after the offer is received

  • (a) by the Minister, the Government of Canada may accept it within 60 days or, if the Minister has extended the period under subsection (3.1), within that period;

  • (b) by a provincial minister, the government of the province may accept it within thirty days, unless the offer is received by the Minister, in which case the government of each province may accept it within an additional thirty days after the end of the period mentioned in paragraph (a) if it is not accepted under that paragraph;

  • (b.1) by an urban transit authority, it may accept it within an additional 30 days after the end of the period or periods for acceptance under paragraphs (a) and (b), if it is not accepted under those paragraphs; and

  • (c) by a municipal or district government, it may accept it within an additional 30 days after the end of the period or periods for acceptance under paragraphs (a), (b) and (b.1), if it is not accepted under those paragraphs.

• Marginal note:Extension

  (3.1) If the Minister considers it appropriate to do so, the Minister may extend the period referred to in paragraph (3)(a) by 120 days. The Minister may further extend the period, but the total of those further extensions may not exceed 365 days. Each time the Minister extends the period, the Minister shall provide a notice to the railway company and the railway company shall notify the other governments and urban transit authorities.

• Marginal note:Service obligations

  (3.2) If the Minister extends the period referred to in paragraph (3)(a), the railway company has no service obligations in respect of the operation of the railway line commencing on the expiry of 150 days after the offer was received by the Minister and ending on the expiry of 280 days after the expiry of the extended period referred to in that paragraph. The railway company shall not remove any of the infrastructure associated with the line during the period for which it has no service obligations.

• Marginal note:Communication and notice of acceptance

  (4) Once a government or an urban transit authority communicates its written acceptance of the offer to the railway company, the right of any other government or urban transit authority to accept the offer is extinguished, and the railway company must notify the other governments and urban transit authorities of the acceptance.

• Marginal note:Declaration

  (4.1) The railway company shall, at the time of a transfer to a government or an urban transit authority, provide a written declaration to the government or urban transit authority stating that the transfer is in compliance with section 96. It shall also send a copy of the declaration to the Minister.

• Marginal note:Net salvage value

  (5) If a government or an urban transit authority accepts the offer, but cannot agree with the railway company on the net salvage value within 90 days after the acceptance, the Agency may, on the application of the government or urban transit authority or the railway company, determine the net salvage value.