Headlines News
Railway in Quebec tragedy has its Canadian licence suspended

August 13, 2013, Ottawa – The company at the centre of the Lac-Megantic, Que., train disaster has had its operating licence suspended in Canada, in a severe blow to an already crippled railway.

The Canadian Transportation Agency announced Tuesday that it's revoking the certificate of fitness for the Montreal, Maine & Atlantic Railway.

The federal agency said it contacted the company to ensure that it has topped up its insurance, following the myriad financial claims against it in the wake of the derailment.

But the agency said it's not satisfied the embattled company has purchased sufficient new insurance – so the licence for the railway and its Canadian branch will be revoked as of Aug. 20.

"This was not a decision made lightly," said Geoff Hare, chairman of the arm's length federal regulator.

"It affects the economies of communities along the railway, employees of MMA and MMAC (Montreal, Maine & Atlantic Canada), as well as shippers who depend on rail services.

"It would not be prudent, given the risks associated with rail operations, to permit MMA and MMAC to continue to operate without adequate insurance coverage."

The railway has already filed for bankruptcy protection and its survival now seems a longshot.

Forty-seven people died when an MMA train slammed into Lac-Megantic, Que., and erupted into fireballs on July 6. Since then, several lawsuits have been filed, a criminal investigation is underway, rail standards have been tightened, and the provincial government has demanded money from MMA for cleanup efforts.

In its statement, the agency also said it will undertake a review this fall of insurance coverage at federally regulated railways, given the ongoing increase in shipments of crude oil and other hazardous materials.

An official in the office of MMA chairman Ed Burkhardt, contacted this morning, said he wasn't yet aware of the licence suspension.