SUBJECT: Extended Interswitching Pilot Project
DATE: May 30, 2025
SUGGESTED RESPONSES
- The Government of Canada is dedicated to strengthening supply chains and ensuring that Canadians have a reliable, efficient and competitive freight rail system.
- The Government remains committed to evaluating the impacts of extended interswitching in supporting supply chain partners deliver their products to domestic and overseas markets.
- This commitment builds upon an 18-month extended interswitching pilot that was in place until March 2025.
IF PRESSED
- We continue to engage with a wide range of stakeholders on how to analyze and understand the impacts of extended interswitching.
BACKGROUND INFORMATION
- Interswitching is the transfer of traffic between two railway companies. One railway takes a shipper’s freight part of the way between origin and destination. It then transfers the freight to a competing railway with which the shipper has made arrangements for the rest of the haul. The transfer takes place at an interchange, where the lines of the two railways connect.
- In fall 2022, a National Supply Chain Task Force issued its final report to the Minister of Transport with recommendations for supporting Canada’s supply chains. One of the recommendations was to increase regulated interswitching limits.
- In response, the Government of Canada implemented an 18-month pilot project to evaluate extended interswitching. The pilot project applied to traffic originating or destined to Alberta, Manitoba, or Saskatchewan.
- The pilot project was announced in the Budget Implementation Act, 2023. It came into force on September 20, 2023, and sunset on March 20, 2025.
- Extended interswitching was previously in force between 2014 and 2017. The radial distance used at that time was 160 km so that was the distance used for the 2023 pilot project.
- Extended interswitching is a polarizing subject. Generally, shippers support it while railways are opposed.