CN files motion to force disclosure on UP-NS merger

Executive Summary

• Canadian National Railway (CN) has filed a motion with the Surface Transportation Board (STB) to compel Union Pacific (UP) and Norfolk Southern (NS) to disclose additional information regarding their proposed merger.
• CN argues that the applicants have failed to provide a transparent assessment of competitive harms, citing significant gaps in their original application that undermine the STB's ability to evaluate the transaction's impact on competition.
• The motion highlights specific deficiencies in market analysis, traffic data, network mapping, and the lack of proposed competitive enhancements, asserting that these issues render the application incomplete.

Key Details

• Legal Action: CN filed a motion with the STB to force disclosure of information related to the UP-NS merger review.
• Core Argument: CN contends the applicants have not been upfront about competitive harms and are hiding behind "inapt legal arguments" rather than meeting the "highest standard of transparency" required by new merger rules.
• Identified Gaps in Applicant's Application:
  • Incomplete Market Analyses: Applicants failed to disclose the methodology and data supporting the claim that only three "two-to-one" shippers exist and did not provide full lists of two-to-one and three-to-two points as required by the STB.
  • Missing Projections: Required market share projections by revenues and traffic volumes were omitted, along with key traffic data, which undermines the traffic inputs for operating plans.
  • Incomplete Network Map: The original maps failed to depict certain trackage and haulage rights, including segments with direct parallel or overlapping lines in watershed states. CN alleges this was an attempt to misportray the transaction as end-to-end. Applicants have since conceded this error and filed a new map.
  • Failure to Propose Competitive Enhancements: Applicants claimed remedies should be addressed at the merits stage, but CN argues this is a completeness issue. The application currently offers no proposals to enhance competition.
• Stakeholder Statement: Olivier Chouc, Senior Vice-President and Chief Legal Officer of CN, stated that the information refused by applicants is critical for the board's public interest and competition analyses.

Notable Quotes

• "Given the scale and stakes of the proposed combination, the applicants must meet the highest standard of transparency and compliance. The information the applicants refuse to disclose is critical to understand their perspective on anticipated competitive harms and inform the board's public interest and competition analyses." — Olivier Chouc, CN