OTTAWA — Canada’s major railways are collecting service charges from customers more diligently than ever but reject accusations by a major shipping group of gouging, the National Post reports.
Both Canadian National Railway Co. and Canadian Pacific Railway Co. said yesterday the extra charges levied for such things as railcar waiting times or car switching are intended only to make their systems better.
The railways were responding to a complaint filed with the Canadian Transportation Agency yesterday by the Canadian Industrial Transportation Association that such charges are illegal.
“Accessorial charges or chargeable services that we impose are a fair and legitimate means of generating rail efficiencies that benefit both CN and the shipper and, furthermore, they are in accordance with the [law],” said Mark Hallman, a CN spokesman.
Len Cocolicchio, a CPR spokesman, said the charges are in shippers’ contracts so no one should be surprised or complain. Lisa MacGillivray, CITA’s president, said the group appealed to the regulator because shippers only learn of new charges when they get billed, the bills are often wrong and the railways are reluctant to fix problems that arise. It wants the agency to clarify the situation and force railways to consult more with customers.
U.S. shippers have similar concerns about U.S. railways, the National Industrial Transportation League said yesterday.
Messrs. Hallman and Cocolicchio said the charges are not a cash grab but an incentive for shippers to move cars quickly. They likened them to late fees for overdue videos or rental cars.
The railways have become more diligent about collecting the fees in recent years as part of cost-saving efforts, they added.
“If you don’t have cars being used efficiently you’re going to be having clogged yards and clogged sidings and this will penalize all shippers with poorer car availability and higher system costs,” said Mr. Hallman.