CN challenges UP-Norfolk Southern merger application as incomplete

Canadian National Railway (TSX: CNR) (NYSE: CNI) filed comments with the Surface Transportation Board arguing that the amended merger application from Union Pacific and Norfolk Southern remains incomplete and should be rejected.

CN stated the amended application addresses only one of three deficiencies identified by the STB when it rejected the initial application in January 2026. The companies provided the complete merger agreement but failed to remedy other identified issues, according to CN's filing.

The amended application still lacks complete competition analyses required by STB regulations, consistent market share information, and accurate identification of markets that would lose competitive options, CN said. The filing also noted the absence of analyses regarding downstream competitive impacts from potential future rail consolidation and a required application for control of the Terminal Railroad Association of St. Louis.

CN criticized the proposed Committed Gateway Pricing program, which it described as the sole competitive enhancement offered by the applicants. The program applies to less than one percent of U.S. rail traffic and excludes finished vehicles, intermodal shipments, unit trains, and customers currently served by CN, CPKC, and most short lines.

"Rather than provide the required competition analyses, they recycled the same flawed approach the Board already rejected," said Olivier Chouc, CN's Executive Vice-President and Chief Legal Officer.

According to CN's analysis of the applicants' own expert modeling, the pricing program would harm many shippers, with some facing increased rail shipping costs. CN submitted state maps with its comments illustrating these potential cost increases.

The Surface Transportation Board requires Class I railroad mergers to enhance competition and meet public interest standards. CN expressed confidence that the board will maintain these regulatory standards in its review process.

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