Scenarios where a railway company can object to a rail level of service application

Matters that may not be submitted for arbitration are identified in subsections 169.31(2), (3) and (4) of the Canada Transportation Act.

Under subsection 169.43(1), the railway company has 10 days to apply to the Agency for an order declaring that the shipper is not entitled to submit one of those matters in its submission.

If the Agency makes an order, it may also dismiss the submission for arbitration if it has not yet been referred for arbitration, discontinue the arbitration, impose terms on the arbitration, or set aside the arbitrator's decision or any part of it. 

Scenarios where a railway company can object

Scenario Details

The matter is already governed by a written agreement between the shipper and the railway company

See: Paragraph 169.31(2)(a)

 

Types of written agreements include:

  • existing level of service agreements; and,
  • any other existing contract between the shipper and railway company that sets out terms and conditions of the service to be provided to the shipper.

However, specific elements of service relating to traffic that are not covered by an existing written agreement could proceed to level of service arbitration. The determination of whether any specific matter is governed by an existing agreement will be determined on a case by case basis, having regard to the provisions of the existing agreement as a whole.

The matter is the subject of an order, other than an interim order, made under subsection 116(4)

See: Paragraph 169.31(2)(b)

If the Agency determines that a railway company is not fulfilling its service obligations under section 116 of the CTA, it may impose terms or conditions in an order. These terms or conditions are not eligible for level of service arbitration.

Such terms may include, amongst others:

  • the amount of cars or other equipment to be used; and
  • the frequency of the service or manner in which it will be provided.

The traffic is the subject of a tariff or a contract whose terms were set by an arbitrator decision under final offer arbitration, as described in subsection 165(3)

See: Paragraph 169.31(3)(b)

Any traffic that is subject to an arbitrator’s decision rendered under the Agency’s final offer arbitration process is not eligible for level of service arbitration.

The traffic is the subject of a long-haul interswitching order made under section 134(1) 

See: Paragraph 169.31(3)(c)

If a shipper intends to move its goods and has access to only one railway company at the origin or destination of the movement, but the continuous route is operated by two or more railway companies, the shipper may ask the railway company for a long-haul interswitching rate under subsection 134(1). 

Where a long-haul interswitching rate has been established, the traffic moving under the LHI is not eligible for level of service arbitration.

The traffic is the subject of an arbitrator’s decision under section 169.37

See: Paragraph 169.31(3)(d)

Any traffic that is subject to a previous arbitrator’s decision rendered under the Agency’s level of service arbitration function is not eligible for arbitration.

The matter relates to a rate for the movement of traffic or to the amount of a charge for the provision of incidental services.

See: Subsection 169.31(4)

The rate for moving traffic and charges for moving traffic or for incidental services (such as demurrage, or storing and cleaning railway cars) are not eligible for level of service arbitration.
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