Competition Bureau obtains remedies in BC Rail merger

OTTAWA, July 2, 2004 — Today, the Competition Bureau filed a Consent Agreement  with the Competition Tribunal providing a package of safeguards enabling Canadian National Railway ("CN") to complete its partnership transaction with British Columbia Rail ("BC Rail"). The agreement aims to preserve competition for interline transportation of lumber, and other commodities, and maintains competitive rates and services for grain transportation from the Peace River area.

"We carefully considered the implications this transaction would have on competition," said Robert Lancop, Assistant Deputy Commissioner of Competition. "The agreement provides remedies in response to issues raised by rail customers, grain handlers and other stakeholders."

The Consent Agreement includes the following key elements:

On rail interline traffic:

• shippers will have direct access to competing rail carriers in Vancouver through the "open gateway" arrangement;
• CN will be required to publish rates for shipping on the BC Rail line to Vancouver, enabling connecting rail carriers to compete for long haul traffic;
• clear standards have been set to measure CN's performance against its commitment to improve the transit times achieved by BC Rail;

On grain transportation from the Peace River area:

• shippers will have competitive price protection measures;
• existing rail service will be maintained;
• safeguards have been added to ensure the non-discriminatory supply of covered hopper cars for the transportation of grain.

The Competition Bureau is an independent law enforcement agency. We contribute to the prosperity of Canadians by protecting and promoting competitive markets and enabling informed consumer choice.

Please see attached Backgrounder > Competition Bureau obtains remedies in BC Rail merger for more information.

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