The Federal Court of Appeal has ruled against Canadian National Railway in a dispute over rail switching rules near Winnipeg.The court on June 21 upheld a February 2009 decision by the Canadian Transportation Agency that the exchange of cars between CN and BNSF Railway is interswitching as defined in the Canadian Transportation Act and the rate should remain regulated.Grain shippers and exporters say it was an important case to ensure the continued smooth and efficient shipment of grain to the United States.CN had argued that it was not interswitching for legal and technical reasons and the railway should be free to negotiate a commercial rate with BNSF.Shippers said that would result in higher rates, making the movement less competitive.The case was the subject of a hearing by a three-judge panel of the federal court in Ottawa on May 11.In a unanimous 14-page decision, the court rejected CN’s arguments, ruling that the CTA acted within its authority, it properly defined interchange and interswitching, CN is a local carrier as defined by the act, and the rules of interswitching apply to the Winnipeg situation.The interchange and interswitching agreement between CN and BNSF dates back to 1912. It is the only point on the Prairies from which grain cars can be shipped directly to the United States.In a brief to the original CTA hearing, the Canadian Wheat Board said it shipped about 130,000 tonnes of wheat directly to U.S. buyers via BNSF in 2009.
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