How Should Rail Interswitching Rates Be Set?
Official title: Consultation on commercial market factors to be considered in determining fair and reasonable interswitching rates
When a shipper needs to move freight between two railways, they pay an "interswitching" fee. A court ruled the Agency's method for setting these rates was flawed. Now the Agency is asking: what market factors should influence these regulated rates?
Why This Matters
This is pretty technical, but it affects shipping costs across Canada. Higher interswitching rates mean higher costs for businesses moving goods by rail. Those costs eventually show up in the prices you pay for products.
What Could Change
The Agency will revise how it calculates interswitching rates for 2024, 2025, and 2026. The new methodology will factor in commercial market conditions, which could raise or lower what shippers pay when freight switches between CN and CPKC lines.
Key Issues
- What commercial market factors should influence interswitching rates?
- What additional data should railways provide to assess these factors?
- How much weight should market factors carry in the rate-setting formula?
- What methodology should be used to calculate the final rates?
How to Participate
- Review the Letter decision on interswitching rates and the Railway Interswitching Regulations to understand the context.
- Submit your input by email to ferroviaire-rail@otc-cta.gc.ca by February 6, 2026. You can respond to all questions or just those relevant to you.
- After initial submissions are posted on February 20, 2026, you can submit responses to other stakeholders' input by April 7, 2026.
Submit Your Input
Questions Being Asked (4)
- What are the commercial market factors that the Agency should consider in its determination of regulated interswitching rates? Provide data and a rationale for your response.
- What additional data should railways provide in order for the Agency to consider these market factors? Provide a rationale for your response.
- What weight, if any, should the Agency give to commercial market factors in its rate-setting methodology? Provide data and a rationale for your response.
- What methodology should be used to apply these weights to calculate interswitching rates? Provide a calculation and a rationale for your response.