Canadian National Railway, a Montreal-based company, has urged the U.S. Surface Transportation Board to reject the amended merger application by Union Pacific and Norfolk Southern.
The application, submitted by UP and NS, was initially rejected by the STB in January due to missing information on forward-looking market share data, details that would allow UP to walk away from the deal, and specifics on control of a terminal railway in St. Louis.
CN claimed that the revised application addressed only one deficiency by providing the complete merger agreement, but still fell short of the regulator's requirements.
The company argued that the proposed Committed Gateway Pricing program, which it deemed 'temporary' and 'highly limited', was the sole alleged enhancement to competition, but would actually harm many shippers due to increased rail shipping costs.
CN criticized the applicants for recycling a flawed approach already rejected by the board, and for proposing a pricing program that would have a negative impact on shippers.
The company's executive vice-president and chief legal officer, Olivier Chouc, stated that the application was not a serious effort to comply with the Board's requirements, but rather a disregard for the process and for the stakeholders who depend on it.
CN remains confident that the STB will conduct a thorough and fair review of the application, but its rejection could have significant implications for the rail industry and shippers.
The merger between UP and NS has been a subject of intense scrutiny due to its potential impact on competition and market share in the rail industry.
The STB's decision highlights the importance of ensuring that mergers and acquisitions are reviewed thoroughly to protect the public interest and promote competition.
The STB's rejection of the merger application highlights the importance of rigorous regulatory oversight in the rail industry.
