CN, BNSF TAKE STB MORATORIUM RULING FIGHT TO CONGRESS

CN, BNSF TAKE STB MORATORIUM RULING FIGHT TO CONGRESS    The chief executive officers of Canadian National and Burlington Northern Santa Fe said the Surface Transportation Board overstepped its statutory authority and prejudged the railroads’ proposed consolidation by declaring a 15-month moratorium on rail mergers.
   The STB decision, which puts the proposed CN-BNSF merger in limbo, prompted the rail executives to file written comments with the Senate Surface Transportation and Merchant Marine Subcommittee, which held hearings on the ruling yesterday.
   Both railroads have appealed the STB's ruling to the U.S. Circuit Court of Appeals for the District of Columbia.
   Robert D. Krebs, chairman of BNSF, accused rail competitors of stirring speculation that approval of the CN-BNSF merger would lead to another round of consolidations, reducing the nation’s rail system to two carriers.
   “Much of the speculation … was spurred by our railroad competitors, a number of which had recently engaged in railroad mergers that resulted in serious service problems that affected not only their customers, but users of adjacent systems and other railroads, as well,” Krebs said.
   CN and BNSF also contested the view that the majority of witnesses testifying at a recent STB hearing support a moratorium. Many shippers, economists, and Transportation Secretary Rodney Slater testified that “a moratorium would be a bad idea,” Krebs said.
   Nevertheless, the STB “accepted the anticompetitive, self-serving arguments of our competitors,' Krebs said.
   “The board’s decision is illegal and in clear violation of the policies and terms of the ICC Termination Act,” which governs STB activities, Krebs said.
   “The STB’s decision deprives CN and BNSF of our statutory right to a prompt and fair hearing,” said CN president Paul N. Tellier. “It is also contrary to the public interest in efficient rail transportation. In fact, if the STB’s consideration does not proceed, the public benefits of the CN-BNSF transaction, which could be in excess of $500 million annually, will be either delayed or lost forever.”