Decision No. 387-R-2004

July 15, 2004

APPLICATION by Canadian National Railway Company pursuant to paragraph 93(1)(c) of the Canada Transportation Act, S.C., 1996, c. 10, to vary Certificate of fitness No. 97001-1 to reflect the addition of BC Rail Partnership to Canadian National Railway Company's Certificate of fitness.

File No. R 8005/C2

On July 13, 2004, Canadian National Railway Company (hereinafter CN) filed with the Canadian Transportation Agency (hereinafter the Agency) the application set out in the title.

On March 15, 2004, the Agency issued Certificate of fitness No. 97001-1 and Decision No. 122-R-2004 to reflect the acquisition by CN of the share interests in BC Rail Ltd. and the partnership interests in BC Rail Partnership from the British Columbia Railway Company and BCR Properties Ltd. As a result of the variance, BC Rail Ltd. was added to the Appendix which forms part of the Certificate of fitness.

CN, in its submission, indicates that the operating entity, the transportation contracts and the land lease are with BC Rail Partnership and as such requests a variance of the subject Certificate to include BC Rail Partnership.

Paragraph 93(1)(c) of the Canada Transportation Act (hereinafter the CTA) states that the Agency may, on application, vary a certificate of fitness to reflect a change in railway operations or in circumstances relating to those operations.

Subsection 92(1) of the CTA requires that the Agency shall issue a certificate of fitness for the proposed operation of a railway if the Agency is satisfied that there will be adequate liability insurance coverage for the proposed operation, as determined in accordance with the Railway Third Party Liability Insurance Coverage Regulations, SOR/96-337.

With respect to the adequacy of the insurance coverage, CN stated that the addition of BC Rail Partnership to the Certificate does not affect the risk assessment that was performed by the Agency at the time of the issuance of the Certificate and Decision on March 15, 2004. In this regard, the Agency agrees with CN and is satisfied that the railway company subject to this application continues to have adequate third party liability insurance coverage, including self-insurance, for the existing and proposed railway operations.

Accordingly, pursuant to paragraph 93(1)(c) of the CTA, the Agency hereby varies Certificate of fitness No. 97001-1 issued on March 15, 2004 to reflect the addition of BC Rail Partnership to CN's Certificate of fitness.

Certificate of fitness No. 97001-2 supersedes Certificate of fitness No. 97001-1 issued to CN on March 15, 2004.

Appendix

Canadian National Railway Company

Canadian National Railway Properties Inc.

Quebec and Lake Saint John Railway Company

Canadian Northern Quebec Railway Company

St. Clair Tunnel Company

Shawinigan Terminal Railway Company

Canada Southern Railway Company

Ecorail Ltd.

BC Rail Ltd.

BC Rail Partnership