Fair Rail Freight Service Act: Receives Royal Assent

On June 26 2013 Dennis Lebel the Canadian Minister of Transport, announced that the Fair Rail Freight Service Act was now in place after receiving the Royal nod. This new law, requires that railroads begin offering service agreements to those companies that request them. It will be intrusted to both the railroads and shippers to negotiate the terms of the service agreement, with the fall back being an arbitration process so that an agreement is made. The outcome of the service contract will be that the Canadian Transport Agency (CTA) will be able to impose fines (up to $100,000) per violation against the railroad of said contract. The intent of this legislation is to improve the dependability of rail transport within Canada, while allowing an open forum between shippers and rail providers.

Although shippers have seemingly taken the legislation in stride in hopes of strengthening their relationship with rail providers, Railways themselves have shown disapproval with the new legislation claiming that long term complete service failures are not evident in their day to day operations. Time will only tell if this new law will be beneficial to the rail industry, and the Canadian Economy as a whole.

For more information please visit the CTA website: http://tc.gc.ca/eng/mediaroom/releases-2013-h084e-7234.html