New Canadian legislation aims to bolster rail safety, strengthen oversight

In a move aimed at increasing accountability and safety among railroads in Canada, Canadian Minister of Transport Lisa Raitt on Friday introduced new amendments to the Canada Transportation and Railway Safety Acts.

The new legislation covers a wide swath of safety issues, ranging from insurance coverage for accidents to increased transparency in information sharing.

The proposed amendments would require railroads to obtain a minimum level of insurance, ranging from $25 million to $1 billion (in Canadian dollars), depending on the amount of hazardous materials they transport. The amendments would also require crude-oil shippers to pay an additional tax, which would be used to cover the costs of crude-related accidents that exceed minimum insurance requirements. The new liability and compensation regime is based on a "polluter pays" principle, making railroads and shippers responsible for accident costs.

In addition, Raitt’s amendments would provide Transport Canada more authority to enforce new Railway Safety Management Systems regulations that will be published in detail on Feb. 25. The regulatory changes would broaden the powers of inspectors to order railroads and others to take specified measures or stop any activity deemed necessary for safe rail operations, and create new regulation-making powers requiring railroads to share information with municipalities.

"The government of Canada continues to make the safety and security of Canadians a top priority," Raitt said in a statement. "This new legislation will improve railway safety and strengthen oversight while protecting taxpayers and making industry more accountable to communities."

Canada’s railroads support Raitt's proposal to have more stakeholders share in the costs associated with rail accidents involving hazardous materials, said Railway Association of Canada (RAC) officials in a statement. The approach will ensure that there are sufficient funds available to compensate those who suffer damages and cover clean-up costs in the event of an incident, they believe.

But the liability and compensation regime doesn't apply to those haz-mat shipments that could have the most severe impacts, RAC officials said.

"We are pleased with the government’s efforts to ensure that victims are compensated. However, the regime can be improved by including other dangerous goods – such as chlorine – in the compensation fund right away," said RAC President and Chief Executive Officer Michael Bourque.