EUROPE: The European Commission has sent Czech and Austrian national operators ČD and ÖBB a statement of objections setting out its preliminary view that they may have colluded to prevent new entrant RegioJet acquiring second-hand passenger rolling stock for use on competing services.
The European Commission began its investigation with unannounced inspections in 2016. On June 10 it announced that it had now informed the two incumbents of its preliminary view that they colluded in 2012-16 to prevent RegioJet buying used ÖBB long-distance coaches, with the aim of maintaining their market position and impeding the expansion of the new entrant in the Czech Republic and on the Praha – Wien route.
If confirmed, this would mean ČD and ÖBB infringed Article 101 of the Treaty on the Functioning of the European Union that prohibits anti-competitive business practices.
Issuing the statement of objections means the parties can now examine documents in the commission’s investigation file, reply in writing and request a hearing with representatives of the commission and national competition authorities.
If the commission subsequently concludes that there is sufficient evidence of an infringement, it can adopt a decision prohibiting the conduct and imposing a fine of up to 10% of a company’s annual worldwide turnover.
Responses
The European Commission said the EU Green Deal aims to increase the efficiency of the transport system and prioritises rail as an environmental-friendly mode, and ‘this cannot be achieved without the existence of effective competition’.
Margrethe Vestager, Executive Vice-President in charge of competition policy, said ‘with healthy competition, European citizens benefit from good quality and affordable rail passenger services. Attractive rail passenger services also encourage travellers to shift from road to rail transport, which is essential for achieving the EU Green Deal’s objectives.’
ČD told Railway Gazette International that the statement of objections was only the commission’s preliminary view, and ČD does not acknowledge that it had entered into a cartel agreement.
ÖBB said ‘we are interested in clarifying the case and are co-operating with the European Commission’.
The AllRail alliance of new entrants to the passenger market said the lack of access to second-hand vehicles is one of the biggest barriers preventing newcomers from starting commercially-driven open access services. It said there is no functioning market for long distance coaches owned by incumbents, and so it believes that dominant players should be required to sell or rent underutilised vehicles to newcomers without preferential treatment for other incumbents or unnecessary scrapping.
AllRail said incumbents in EU states such as Austria and Slovenia were using this lack of available rolling stock to claim that there is market failure, and that cross-border services should be provided by incumbents under public service obligation contracts
‘If the incumbents’ second-hand rolling stock is not available, then this is causing the market failure in the first place, leading to the PSOs that will mostly be awarded to incumbents’, said AllRail. ‘It is all highly suspicious.’
