REGISTRATION RIGHTS AGREEMENT

     THIS REGISTRATION RIGHTS AGREEMENT (the Agreement) is made and entered into as of February 24, 2004 by and between CP Ships Limited, a corporation existing under the laws of the Province of New Brunswick, Canada (the Company), and Morgan Stanley & Co. Incorporated and RBC Capital Markets Corporation (together, the Managers) and the other Initial Purchasers named in the Purchase Agreement referred to below (collectively, the Initial Purchasers), for whom the Managers are acting as representatives, pursuant to the Purchase Agreement dated February 19, 2004 (the Purchase Agreement), between the Company and the Initial Purchasers. In order to induce the Initial Purchasers to enter into the Purchase Agreement, the Company has agreed to provide the registration rights set forth in this Agreement. The execution of this Agreement is a condition to the closing under the Purchase Agreement.

     The Company agrees with the Initial Purchasers (i) for their benefit as Initial Purchasers and (ii) for the benefit of the beneficial owners (including the Initial Purchasers) from time to time of the Notes (as defined herein) and the beneficial owners from time to time of the Underlying Common Shares (as defined herein) issued upon conversion of the Notes (each of the foregoing a Holder and together the Holders), as follows:

     1.   Definitions. Capitalized terms used herein without definition shall have their respective meanings set forth in the Purchase Agreement. As used in this Agreement, the following terms shall have the following meanings:

     Additional Amounts has the meaning set forth in Section 2(e) hereof.

     Additional Interest Accrual Period has the meaning set forth in Section 2(e) hereof.

     Additional Interest Amount has the meaning set forth in Section 2(e) hereof.

     Additional Interest Payment Date means each interest payment date under the Indenture in the case of Notes, and each June 30 and December 30 in the case of the Underlying Common Shares.

     Affiliate means with respect to any specified person, an affiliate, as defined in Rule 144, of such person.

     Amendment Effectiveness Deadline Date has the meaning set forth in Section 2(d) hereof.

     Applicable Conversion Price means, as of any date of determination, $1,000 divided by the Conversion Rate then in effect as of the date of determination or, if no Notes are then outstanding, the Conversion Rate that would be in effect were Notes then outstanding.

     ASC means the Alberta Securities Commission.

     Business Day shall mean any day other than a Saturday, a Sunday, a legal holiday or a day on which banking institutions or trust companies are authorized or obligated by law to close in any of New York, New York; London, England; or Toronto, Canada.

     Canadian Securities Laws means the securities laws, rules, regulations and written policy statements of any province or territory of Canada, as the same may be amended from time to time.

     Claim has the meaning set forth in Section 8(h) hereof.

     Common Shares means the common shares of the Company and associated common share purchase rights and any other shares of capital stock as may constitute Common Shares for purposes of the Indenture, including the Underlying Common Shares.

     Conversion Rate has the meaning assigned to such term in the Indenture.

     Effectiveness Deadline Date has the meaning set forth in Section 2(a) hereof.

     Effectiveness Period means a period (subject to extension pursuant to Section 3(i) hereof) of two years after the later of (1) the last date of the original issuance of the Notes, which would include the exercise of the over-allotment option by the Initial Purchasers pursuant to the Purchase Agreement, and (2) the last date that the Company or any of its Affiliates was the owner of such Notes (or any predecessor thereto), or such shorter period of time (x) as permitted by Rule 144(k) under the Securities Act or any successor provisions thereunder, or (y) that will terminate when each of the Registrable Securities covered by the Shelf Registration Statement ceases to be a Registrable Security.