NPBL operates approximately 36 miles of rail line from Portsmouth to Norfolk and approximately 27 miles of trackage rights over NS track from Chesapeake to Norfolk. These trackage rights facilitate NPBL’s access to the Norfolk International Terminals (NIT), which is one of two primary container terminals at the Port of Virginia; the other is Virginia International Gateway. The NPBL Line connects with CSX Transportation (CSXT) at Portsmouth, with NS and Genesee & Wyoming’s Chesapeake & Albemarle Railroad at Chesapeake, and with the Buckingham Branch Railroad at Norfolk.
According to the STB, although NPBL has been owned by NS (57.14%) and CSXT(42.86%) since 1982, a 2022 STB decision found that the agency did not authorize NS’s control of NPBL in 1982 and had not done so since.
The STB reported that on Feb. 14, 2025, NS filed an application for a minor transaction. “However, based on the current record, the Board has questions regarding CSXT’s access to NIT, among other things, and was unable to conclude that the transaction clearly would not have any anticompetitive effects or that any anticompetitive effects would clearly be outweighed by the transaction’s anticipated contribution to the public interest in meeting significant transportation needs, as is required for classification as a minor transaction,” the STB explained. “Therefore, the Board classified the transaction as a significant transaction.”
The STB said that to “avoid unnecessary delay,” it is treating the NS submission as the “prefiling notification” required for a significant transaction and directing NS “to file a supplement to perfect the application and a procedural schedule in accordance with the regulations for significant transactions.” The Board said it is also waiving “certain application requirements unnecessary for the review of this transaction while strengthening the data and information required for a fair and thorough review of competition-related effects.”
The revised procedural schedule is due by March 21, 2025, and NS must perfect the application between April 14 and June 14, 2025.
In a related development, CSXT on Feb. 27 filed a petition to reject NS’s Feb. 14 submission, “arguing that it would be inappropriate to treat the Proposed Transaction as a minor transaction given ‘serious competitive effects involving NS’s unauthorized control of NPBL,’” the STB reported in its March 14 decision (download below). Additionally, CSXT argued that NS “failed to provide any substantial data or evidence on the relevant markets and competitive effects as necessary to determine whether the Proposed Transaction is minor or significant,” the STB continued. “According to CSXT, NS is asking the Board to ‘rubber stamp’ unlawful control that NS has held since 1982 … CSXT argues, however, that the Board ‘must consider the competitive effects of NS’s proposal by looking at two different scenarios: (1) NPBL operating as an independent, neutral railroad (without NS control), and (2) NPBL operating as an alter-ego of NS (with NS control)’ … CSXT also refutes Applicants’ characterization of the related federal court litigation [in which CSXT alleged that NS majority control of NPBL is anticompetitive in violation of antitrust law], noting that, although the district court dismissed the complaint on statute of limitations grounds and lack of ability to grant injunctive relief, the court nonetheless determined that ‘CSXT had developed a sufficient evidentiary record on the existence of anticompetitive conduct and anticompetitive effects to warrant a trial’ … CSXT argues that ‘NS does not even allege the existence of any public interest benefits related to its proposal [to acquire NPBL].’”
Further Reading:
- For Competing Railroads, What’s New Is Old
- Report: Circuit Court Rules CSX vs. NS Case ‘Came Too Late’
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