WASHINGTON (Reuters) -Union Pacific's proposed purchase of smaller rival rail operator Norfolk Southern will need to be approved by the Surface Transportation Board in Washington, an independent federal agency that oversees competition and other areas of importance in the rail industry.

Union Pacific is seeking to buy Norfolk Southern in a $85 billion deal that would create the first transcontinental railroad in the U

Together, the two would create the first transcontinental freight rail in the United States and the largest freight rail network in the country

The Surface Transportation Board said on Wednesday that Union Pacific and Norfolk Southern have formally filed a notice of intent to combine, triggering the U.S. regulatory review process for a proposed $85 billion merger between the two major railroads.

Omaha-based Union Pacific Railroad’s announcement Tuesday that it is acquiring the Norfolk Southern Railway — a move that would create the first transcontinental, coast-to-coast rail system — drew praise from Nebraska’s public and business leaders.

The STB has the power to halt the deal on anti-trust grounds, due to rail shippers' concerns or for other reasons.