Mr. Speaker, it gives me great pleasure to speak to my motion today in Group No. 2 concerning Bill C-14, the Canadian Transportation Act. I want to thank my leader, the hon. member for Sherbrooke, for seconding my motion.
There was one major omission in the bill and that is why I have introduced Motion No. 25. The provision of the existing National Transportation Act section 134(6)(c) designates the Canadian Pacific line from Saint John through to Quebec as a route wholly within Canada for the purposes of the competitive line rates or CLRs. This existing section of the NTA has been dropped in Bill C-14.
There are serious concerns that the wording of Bill C-14 is not clear enough to protect shippers in the maritimes from the captive position they would be in if CN would be the only railway which operates wholly within Canada from the maritime provinces to Quebec.
The provisions of Bill C-14 that deal with the issue of competitive line rates are found in sections 129 to 136. These CLR provisions are basically the same as those contained in the existing National Transportation Act of 1987. The purpose of the CLRs is to protect the shippers against potential monopolistic prices by a railway which has an exclusive position with respect to a particular shipper.
Without the CLR provisions there is the potential that a railway could threaten to charge unreasonably high rates for the exclusive portion of a route served by that railway. In virtually all parts of Canada other than the maritime provinces, there are alternative rail lines wholly within Canada over which the shipper may ship goods.
For over 100 years CP Rail operated a line of railway from Montreal, Quebec to Saint John, New Brunswick. The line went through the eastern townships of Quebec, across the state of Maine in the U.S. and re-entered New Brunswick at McAdam, New Brunswick and from there down to Saint John with a spur to St. Stephen.
Maritime shippers wishing to ship their goods to Quebec and beyond have the option of shipping through Moncton on the CN line or through Saint John via the short lines which now operate along the former CP line. Following an order by the NTA, CP abandoned a portion of its line between Lennoxville and Saint John effective midnight December 31, 1994. Four days later on January 4, 1995 the line was bought by several short line operators.
Those companies bought the line with the assumption that the competitive line rate provisions would still apply. Now with Bill C-14 the CLR provisions concerning the CP line have been eliminated. There seems to be no logical reason why such reactivated lines should be excluded from access to the CLR provisions under Bill C-14.
I hope the example I will give will create a clear picture for my colleagues in the House of the situation we face in the maritimes. Let us take the example of a shipper located in Bathurst, New Brunswick. This shipper is located on a railway line owned by CN and wishes to ship a product to Quebec. Section 134(5) of the present legislation, NTA-87, states:
Where the ultimate point of destination of a movement of traffic of a shipper is in Canada and there is available to the shipper more than one continuous route wholly within Canada that is cost effective and over which it is considered reasonable to move the traffic of the shipper, the shipper shall, in order to have a competitive line rate established, designate a continuous route that is wholly within Canada.
Section 134(6)(c) states that "the Canadian Pacific line through Maine shall be considered to be a route wholly within Canada". These sections allow the Bathurst shipper to request and obtain a CLR rate from CN for the hauling of goods.
Let us assume that Bill C-14 is law. The Bathurst shipper has put in a request to get a CLR rate. What would CN say to this request? CN would say: "Section 131(1) of Bill C-14 denies you the right to a CLR quote unless you and all the connecting carriers have reached an agreement on shipping your goods".
Under section 111 of Bill C-14, a connecting carrier is defined as a railway company other than a local carrier. Under section 87 a railway company is defined as a person who holds a certificate of fitness under section 92. One can only get a certificate of fitness under section 92 if one is federally regulated. The short lines that now operate the former CP line are provincially regulated, not federally regulated, and are therefore not deemed a connecting carrier.
Since the Bathurst shipper does not have an agreement with the connecting carrier under section 131(1), CN is forbidden to quote the Bathurst shipper a CLR. Thus, the Bathurst shipper would be placed at a competitive disadvantage as it would have to use the CN line and CN could charge whatever rate it wanted.
My amendment would solve this problem. It would deem the line from Saint John through to Quebec as a line considered to be wholly within Canada as it has been for Canadian Pacific. It would add a provision that carriers serving the line from Saint John to
Montreal are deemed to be connecting carriers. Thus, the Bathurst shipper would not be placed at a disadvantage.
CP's sale of the Saint John to Sherbrooke line to other railways in January 1995 should make no difference in principle to the analysis of this issue. The fact that the owner of that line is no longer CP is irrelevant to shippers. They still want the option to ship over a route they have shipped over for many years. I know the government wants the private sector to succeed. The only way those in the private sector can succeed now is that they be deemed wholly in Canada.
The purpose of my amendment is to gain a position for maritime shippers. It is not to gain a preferential position for them but merely to ensure that they have the same access to provisions of the CTA as shippers from other parts of Canada.
The short line operators that recently purchased the abandoned CP line through Maine to Quebec felt that this was the situation. There was a natural reliance on the continued existence of the current legislation.
The potential loss of domestic traffic on the former CP line would make it less viable and it is difficult to imagine how it could survive. The maritime provinces cannot afford to lose any more. We have taken unproportional cuts in the last three budgets. We have lost our regional freight rate assistance program that enabled us to get our products to market at a competitive price. The inability of shippers to get these competitive line rates will only make an already bad situation worse.
I have asked myself why the term "wholly within Canada" has been dropped from Bill C-14. Has it been dropped only because CP has sold that line to a number of short line carriers? Are the short line carriers not as important as CP was? Is it that the shippers are not as important in the maritimes as they are in the rest of Canada, or is it because we want CN to be more attractive for sale?
If the government does not accept this amendment, it will be perceived as discriminating against the maritimes. I am sure it does not want that to happen. I ask my colleagues, including government members, to support this amendment for the purposes of protecting an industry and maintaining the competitiveness of the railway and the ability of shippers to compete.
