Ministers discuss 4th railway package

Delegations asked to comment on need to open markets, transition and proposed measures for guaranteeing non-discrimination

By Dods EU monitoring

10 Oct 2014

Please note that this does not constitute a formal record of the proceedings of the meeting. It is dependent on interpretation and acts as an unofficial summary of the debate.

On October 8 2014, the TTE Council discussed two draft directives of the Fourth Railway Package, one which provided for opening up national rail networks to competition from new operators, and another for ensuring non-discrimination in passenger railway markets through governance measures. Delegations were asked to comment on the need to open markets, the transition, and proposed measures for guaranteeing non-discrimination. While not all delegations commented on the need for a transition, many treated the many proposals for ensuring non-discrimination—such as competitive tendering and the independence of infrastructure managers—as separated issues, especially later in the discussion. The report reflects this. Details of the meeting are found below and the background document is available here.

The representative of the Italian Presidency began the meeting by explaining that the discussion marked the beginning of debate for the political pillar of the Fourth Railway Package. Specifically, the debate would focus on two Commission proposals: first, to open national railway systems to competition, and second, to establish rules on the governance of infrastructure managers. He stated he hoped to find common positions on which future legislation could be based. More concretely, he hoped the Council could arrive at a general approach on the proposed directive on governance.

In order to identify common positions, he invited the delegations to comment on three main elements:

  1. The need to guarantee the efficiency of public services in the context of an opened up market;
  2. The need for a transitional period, and;
  3. The need for additional measures to guarantee non-discriminatory access to rail networks, including by extra transparency measures, applying general public tendering procedures, and the possibility to include both profitable and unprofitable lines in public services.

It should be noted that many of the delegations made no comment on the need for a transitional period, but treated the final question as two separate matters, especially later in the discussion. It has therefore been reported as such.

He stated progress on the market pillar would be a prerequisite for moving forward on the technical pillar, on which he noted the Council had already reached an agreement. He also noted that there was welcome interest in the Parliament and the public at large. Commenting that the debate was in its initial phase, he invited all contributions.

Siim Kallas, European Commissioner for Transport, thanked the Italian Presidency for its commitment to the Fourth Railway Package, and welcomed its ambition regarding negotiations on the technical pillar. He stated he was happy that progress had been made on that pillar, but argued it would amount to little without an agreement on railway network governance. He wished to remind the Council that the objective was to be able to travel by train from Italy to Denmark, paying only for market costs. He noted the modal share of rail in the EU transport market continued to be lower than desired. While the technical pillar would help, he argued only with a political agreement could progress be made.

The Spanish representative responded to the questions posed by the Presidency, commenting that:

  • Her delegation was convinced that opening up national networks for passenger transport to competition would result in more investment, ultimately improving quality and efficiency, but cautioned that flexibility would be needed in the area of public service obligations in order to maintain the economic balance;
  • A transition period would be needed to ensure new players would have an equal opportunity to enter the market and for existing contracts to end, and;
  • The agreement must allow for some flexibility to later choose the most appropriate governance model with respect to rail operators and infrastructure managers, and that discrimination must indeed be prevented.

The Slovakian representative reminded the Council that Slovakia had always supported the Fourth Railway Package. Europe, he argued, must have a more efficient and harmonised rail market. For this reason, he said he was happy about the agreement on the package’s technical pillar, especially preceding what he noted would be a more difficult political pillar.

Addressing both the first and third question, he recalled that Slovakia already had some experience reforming its rail sector, having already separated network managers from rail operators and opened to new players. He nevertheless hoped that the option to directly award contracts would be kept open alongside public tendering requirements.

Regarding the second question, he agreed a transition period would be needed in order to respect current contracts. Furthermore, he argued that a longer transition period should be considered in order to avoid future requests for more time.

Concluding, he suggested the European Railway Agency could play an important role in the political—or market—pillar, and said he looked forward to negotiations.

The Danish representative responded to the questions posed by the Presidency, commenting that:

  • Denmark had had an open rail market since 2000, and that the country’s experience showed it was investment in passenger infrastructure that really made rail more attractive, and;
  • Denmark supported the separation of infrastructure managers from rail operators, but argued the precise arrangement should be left to the Member States. He also disagreed with the Commission’s proposal to strengthen supervisory bodies to prevent conflicts of interest.

The representative of the Netherlands noted that the dense Dutch railway system was used heavily. It was a dense network and high frequency that passengers wanted, she argued. Responding to the questions posed by the Presidency, she stated that:

  • The Netherlands did not support mandatory tendering, and wanted to avoid the situation in which private operators could “cherry-pick” profitable lines to operate. She argued flexibility for the Member States would be needed, noting that the Parliament also supported this.
  • The transition period for both licenses (2022) and tenders (2019) were too short, and;
  • The Netherlands had already separated infrastructure managers from rail operators, and that she agreed it would be important to avoid discrimination, including in access to rolling stock.

She also stated her delegation wanted an impact assessment for everything agreed to in the Council. Concluding, she hoped for an agreement by the end of the year so the technical pillar could begin to be implemented.

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