Peace River Coal, CN Rail Dispute Referred Back To Regulator For Resolution

By Caroline Van Hasselt Of DOW JONES NEWSWIRES TORONTO (Dow Jones)--The Canadian government recently overturned a regulatory agency's decision not to wade into a rate dispute between railroad giant Canadian National Railway Co. (CNI, CNT.T) and Peace River Coal Inc., a ruling that clears a major hurdle for shippers, an industry trade group said Tuesday. Peace River Coal filed its complaint, the first of its kind, against Calgary-based Canadian National over a fuel surcharge. However, in 2008 the Canadian Transportation Agency, an independent federal government dispute-resolution body and industry regulator, refused to render a decision, prompting the Canadian Industrial Transportation Association, a trade group, to petition the Cabinet. The agency declined to render a decision, saying it didn't have jurisdiction because the surcharge was referred to in a confidential contract between Canadian National and Peace River. Because of the Cabinet's decision, the agency will now be required to decide on the merits of Peace River Coal's complaint, the trade group said in a statement. "This is a significant victory for shippers," said CITA President Bob Ballantyne in an email. The CITA said that there's been a growing number of complaints over "incidental and supplementary" shipping charges that railways are imposing arbitrarily on their customers. The charges, which are over and above freight charges, include fuel and currency surcharges, fees for submitting paper bills-of-lading, and penalty charges such as demurrage and overloaded cars. "These charges add significant costs to the movement of freight, are arbitrarily imposed by the railways and, for some shippers, measure in the millions of dollars annually," the CITA said. Mark Hallman, a spokesman for Canadian National, said: "We are surprised by...the decision and we are considering our options." Peace River is 74%-owned by Anglo American PLC (AAUKY, AAL.LN). The remaining 26% is held by Hillsborough Resources Ltd. (HLSRF, HLB.T) and NEMI Northern Energy and Mining Inc. (NNEMF, NNE.A.T). In New York, Canadian National closed down 13 cents at $56.73. -By Caroline Van Hasselt, Dow Jones Newswires; 416-306-2023; caroline.vanhasselt@dowjones.com Company Web site: http://www. (END) Dow Jones Newswires July 06, 2010 19:18 ET (23:18 GMT) Anglo American