STB rejects UP NS merger as filing fails completeness rules

STB rejects UP NS merger after finding that the application filed by Union Pacific (UP) and Norfolk Southern (NS) did not meet the Surface Transportation Board decision standards for a complete submission, as reported by Railway Supply.

In its January 16 decision, the STB said the filing was missing items required under its merger rules, including future market share projections covering merger-related growth, diversions and other anticipated changes in market conditions.

This is reported by the railway transport news portal Railway Supply.

STB rejects UP NS merger: decision cites missing materials

The regulator said UP and NS submitted their Agreement and Plan of Merger, but left out certain schedules and documents that are expressly incorporated into the merger agreement and that define the applicants’ obligations.

Don’t miss…Surface Transportation Board rejects rail merger application

The STB also noted the companies did not explain why those materials were not provided, which is why the board treated the merger application as incomplete; the agency outlined its view in a Surface Transportation Board statement.

UP and NS have until February 17 to inform the Surface Transportation Board whether they plan to resubmit. On January 16, the two railroads issued a brief statement confirming that they intend to do so.

UP and NS outline a transcontinental freight railway plan

The application — filed with the STB on December 19 and running to 6,700 pages — seeks approval to create what UP and NS describe as the first transcontinental freight railway connecting the east and west coasts of the United States. The companies say the end-to-end merger would enhance competition and deliver public benefits.

They also argue the combined network would offer freight shippers faster, more efficient single-railway service by removing time-consuming interchanges. UP and NS estimate this would eliminate about 2,400 wagon and container handling operations and reduce activity by around 96,000 wagon-km each day.

In addition, the railroads say the changes would help rail compete more effectively with long-haul trucking, enabling a modal shift of an estimated 2 million truckloads of freight from road to rail each year.

Competing Class 1 railways challenge completeness of the merger application

When the STB invited comments on whether the UP and NS merger application was complete, competing Class 1 railways BNSF, CN, CPKC and CSX argued that it was not, a point also reflected in coverage by Progressive Railroading. The National Grain and Feed Association (NGFA), representing a major customer base for UP and NS, also said the filing was incomplete.

UP and NS, however, maintained that their submission contains all information required by STB merger rules and presents a prima facie case that the proposed transaction is consistent with the public interest.

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