European Union Transport Ministers (EU) met on 8 October 2015 in Luxembourg to discuss the Transport aspect of the Transports, Telecommunications and Energy Council (TTE). The Council, chaired by François Bausch, Luxembourg Minister for Transport, secured general agreement on two proposals within the context of the fourth railway package. The first aims to liberalise railway passenger transport services, the second to strengthen railway infrastructure governance. The participants also held a policy debate on EU transport policy goals and priorities within the context of the 2011 White Paper on Transport.
The Ministers have agreed on a general approach for the fourth railway package
The Ministers reached a general approach to proposals regarding relevant governance and market liberalisation proposals for the fourth railway package. "We have reached an agreement which will help promote rail throughout Europe. I am satisfied with the large support but even more pleased at the balanced and solid solutions that we have agreed upon", said the Minister for Transport, François Bausch, at the press conference that followed the Council.
The Minister welcomed the "effective" agreement, one which "avoids over-regulation". "We will immediately start negotiations with the European Parliament to press ahead with trilogue", he announced.
The fourth railway package was presented by the Commission in January 2013 and aims to lift the last hurdles to achieving a single European railway area.
After the deregulation of rail freight services in 2007 and international passenger transport in 2010, the Commission proposed opening up national rail passenger transport services to competition from December 2019. EU railway companies will thereby have equal access to railway routes, signals and stations in all EU countries to operate national passenger transport services, ensuring fair competition on the railway market. There has been strong opposition to this proposal from European railway unions, who demonstrated at the entrance to the ECCL (European Convention Centre Luxembourg) where the meeting was being held.
The Commission's proposals regarding market governance and deregulation comprises three pillars: a proposal modifying the existing Regulation concerning the opening of the market for domestic passenger transport services by rail - 2013/0028 (COD), a proposal modifying the directive establishing one European railway area - 2013/0029 (COD) and a proposal repealing the Regulation on common rules for the normalisation of the accounts of railway undertakings - 2013/0013 (COD) for which the TTE Council had already adopted a general approach at the session on 3 December 2014.
Whereas the Commission proposed the introduction of liberalisation from 2019 onwards, the general policy drawn up by the Ministers provides that transport on the main domestic lines will be opened up by 2020 and from 2026 for regional trains.
In its compromise proposal for the modified Regulation, the Luxembourg Presidency has indicated that putting public service contracts up for tender may well become the operative rule (under legislation in force in the EU, Member State authorities may either choose to award public service contracts directly, or organise competitive tendering procedures). Nevertheless, important derogations to this rule have been provided for to allow public service contracts to be awarded directly. These derogations take into account concerns expressed by Member States, such as whether implementing competition is appropriate in small markets and the need to ensure the continuity of public railway transport services in the long term. Derogations applicable to low-value contracts have also been proposed concerning performance improvement and exceptional temporary circumstances.
In particular, Member State authorities will be able to choose to award contracts directly where they consider, firstly, that the structural and geographic characteristics relevant to the market and the network so justify and, secondly, that a contract awarded directly would improve the quality of service and/or the cost-effectiveness compared to the previous contract.
A special provision has been added so as to specify that countries with small-scale rail markets may award contracts directly, if they commit to improving public railway services.
The Presidency's compromise also includes longer time-frames than those proposed by the Commission. National authorities may, for example, continue to award public service contracts directly for ten years after the Regulation comes into force (approximately by September 2026), without giving reasons. Directly awarded public service contracts which are already in place when the regulation comes into force may be honoured until they expire.
Regarding the Directive on governance, the Council considered that the numerous organisational agreements in force in Member States are compatible with the proposal's key objectives. Protection mechanisms will be put in place to avoid the risk of conflicts of interest and boost transparency in the transfer of funds between infrastructure managers and railway companies.
In its proposal, the Commission had suggested stepping up EU rules concerning the separation between infrastructure managers, which operate the network and stations, and the railway companies, which operate services. Whereas it proposed that all infrastructure management operations should be subject to a single set of strict requirements governing independence, the Presidency compromise differentiates between essential and non-essential functions. Essential functions relate to decision-making in terms of the allocation of train paths and infrastructure charging. So as to avoid any unnecessary administrative burden and adaptation costs, the measures aiming to guarantee independence should focus on essential functions.
A certain level of flexibility has been introduced in the manner in which the functions of the infrastructure manager can be performed. Member States can decide to authorise path allocation and infrastructure charging to be entrusted to an independent body. Furthermore, the infrastructure manager can, under certain conditions, contract out operations or tasks.
Loans between different railway sector players will not generally be prohibited unless they threaten the smooth running of the sector.
The rules aiming to ensure the independence of personnel and management have been simplified to avoid over-regulation.
At the press conference, François Bausch stressed the need to finalise the technical aspect of the fourth railway package with the European Parliament as quickly as possible, for which an agreement was reached between the two institutions in June 2015. "The agreement reached today is only one aspect of our rail promotion strategy. Technical harmonisation and infrastructure investment are even more crucial issues", he said, whereas the Vice-President of the Commission, Jyrki Katainen, and the Vice-President of the EIB, Pim van Ballekom, informed the Ministers at the Council of the new possibilities of financing linked to the EFSI.
EU Transport Commissioner, Violeta Bulc, welcomed the fact that Europe was "on the point of achieving a true single rail market". She said that this would offer more choice and provide a better service to European passengers. Likewise, rail transport will be in better position to compete with other forms of transport such as cars or buses and foster innovation.
Debate on the White Paper on Transport
The Ministers held a policy debate on the goals and priorities for EU transport policy over the next five to 10 years, within the context of the 2011 White Paper on Transport.
The White Paper aims to put a competitive transport system in place while reducing Europe's dependence on oil and reducing the effect of greenhouse gas emissions by 60 % by 2050 in transport compared to 1990 levels.
During their debate, the Ministers stressed a number of points, notably that additional efforts should be made to achieve goals regarding decarbonisation. They have also called for better implementation of the EU acquis instead of adopting more legislation. The need to take into account the national context was also discussed, as well as clear and ambitious measures for road safety. Infrastructure investment was also confirmed as being a key priority.
Commissioner Bulc was keen to stress that the Commission had ruled out any review of the White Paper. "We are sure that the White Paper's strategtic direction is sufficient, however we must focus on the existing legal framework, on simplification of procedures and on content", she said.