Disputes about the transfer and discontinuance of railway lines

Under Part III, Division V of the Canada Transportation Act, a federal railway company must take these steps before transferring or discontinuing operations:

1. provide notice in the company’s three-year plan for at least 12 months of its intention to discontinue operating the line;
2. publicly advertise the railway line’s availability or any operating interest that the railway company has in the line;
3. negotiate with interested parties; 
4. offer to transfer all of its interest in the railway line to the applicable federal provincial and municipal governments and urban transit authorities; and
5. notify the Agency if the line will be discontinued.

How can the Agency help?

The Agency can help interested parties, railway companies, governments or other parties in four areas related to the transfer and discontinuance process.

Upon application by a party, the Agency can assist by:

• determining whether a particular trackage is subject to the transfer and discontinuance process;
• ensuring compliance with the transfer and discontinuance process;
• ensuring that the railway company and the interested party negotiate in good faith; and
• making a determination about the net salvage value of a rail line if a government and railway company can’t agree. 

If the procedures outlined in the Act are followed and no party, including any level of government, is interested in acquiring the line, the railway company is free to cease operating the line and may dispose of the assets as it wishes.

To learn more, see applications: transfer and discontinuance of railway lines.