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Agency says CN fails to meet service obligations
Source: Canadian Press
Published: January 18th 2008
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OTTAWA - A federal regulator says Canadian National Railway Co. (TSX:CNR) has failed to meet its level-of-service obligations to the Canadian Wheat Board and five other shippers for services provided for the 2006-07 crop year.

Under the Canada Transportation Act, shippers can file a complaint if they believe railway companies fail to provide adequate and suitable service to them.

The Canadian Wheat Board called the ruling "a milestone victory."

It said the issue was CN's 2006 decision to provide most of its advance-booked grain hopper cars in blocks of 100, booked for 42 consecutive weeks to a single destination - called the GX100 program.

"This system essentially prevented participation by smaller shippers and those without multiple terminals. It also failed to satisfy the diverse needs of Prairie farmers in moving their grain to port," the wheat board stated in a release Friday.

The transportation agency said its ruling that it recognizes that CN, the country's largest railway, has revised its grain product programs for 2007-08 in an effort to address shortfalls.

However, the transportation agency also said it had insufficient information to rule on the 2007-08 crop year at this time.

It has ordered CN and the six shippers to file service information for the period of August 2007 to April 2008 adding, "the agency will be able to make a final determination on the adequacy of CN's service to grain shippers once it has all the necessary information."

CN spokesperson Jim Feeny said the ruling is related to a similar one made in July which directed the company to make changes to its car allocation and ordering program.

"The agency acknowledges we made those changes and now has asked for more information on service and performance, which we will fully comply with," Feeny said in an interview.

Besides the Canadian Wheat Board, the other five shippers to complain about CN were: North East Terminal Ltd., Paterson Grain, Parrish and Heimbecker Ltd., Providence Grain Group Inc. and North West Terminal Ltd.



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