Parliament in push to further liberalise EU railways

International passenger routes could be opened up to competition as early as 2008 and national ones as of 2012, if Parliament gets its way against a group of reluctant countries led by France.

The liberalisation of international passenger rail routes is to be speeded up with competition unlocked as early as 2008 instead of 2010, under a revised version of the EU’s so-called third railway package by the European Parliament.

Euro MPs voting in Strasbourg on 28 September went further down the liberalisation track than the Commission by introducing a new requirement to open up national routes to competition, starting from 2012. 

This new provision is likely to meet with stiff opposition from several EU countries when transport ministers discuss the package on 6 October. For the first time, railway liberalisation has been put on the ministers’ agenda but the matter is expected to create tensions in the Council between supporters and opponents of more liberalisation.

FranceBelgium and Luxembourg are leading the opponents’ group, an EU source told EURACTIV, describing the opening of national routes to competition as “clearly highly political” and “super-sensitive”. The countries most in favour include the UKGermany and Italy.

However, the liberalisation of international passenger routes is likely to prove less controversial, the source added, because the matter was already mentioned in a political declaration issued by ministers when they adopted the second railway package in 2004.

Some anticipate the whole liberalisation issue will split the Council down the middle and will lead to a break up of the package into four separate proposals.

In a separate vote, MEPs also backed a proposal introducing compensation for train travellers in case of delays, as is also now the case for airlines. MEPs proposed the following minimum compensation:

  • 25% of the fare for a delay of 60 minutes or more;
  • 50% for a delay of 120 minutes or more and
  • 75% for a delay of 180 minutes or more.

In separate votes, MEPs adopted a less controversial proposal to harmonise the certification of train drivers and crews by a large majority (Savary report). 

However, they rejected a proposed regulation setting a compensation scheme for delays in freight (Zile report) on the grounds that it would not improve standards in the industry. The Commission estimates the average speed of international rail freight in Europe to reach 18 km/h, or the speed of an ice-breaker.

Gilles Savary MEP, who was leading the fight against the Jarzembowski report in Parliament, warned against a "dangerous European deregulation à la Thatcher".  The report, he said was adopted by a thin and composite majority made up of several political groups, which proves the apprehension of many MEPs on the issue.

According to Savary, the most pressing issue at stake is the opening of so-called 'cabotage' to international routes, a move which would allow foreign companies to operate stops within a country on an international line. 

"This new step in liberalisation shows a worrying risk of breaking up rail networks in small countries in favour of an oligopoly around a small number of dominant European companies," Savary warned.

French diplomatic sources told EURACTIV they were "disappointed" with the vote to further liberalise railways. "We're not interested by the opening up of national cabotage," said Michèle-Ann Okolotowicz, an adviser at the French permanent representation in Brussels. Instead, she says the French would rather see a gradual and controlled liberalisation process that fully respects safety and social concerns. "Traditionally, France is not open to liberalisation," said Okolotowicz.

The vote in Parliament was welcomed by EU Transport Commissioner Jacques Barrot of France. "Liberalisation of international passenger transport will make international trains more competitive and attractive. The Parliament's strong support will be crucial to attain our goal, which we can realistically expect by 2010 and not earlier."
But Barrot was less enthusiastic about opening national routes. "The European Parliament's amendment to also open up the market of national railway lines, however, is premature and is not justified economically," he declared.

Other countries are expected to back France, Belgium and Luxembourg in their opposition to further liberalisation. They are the ones where operators are most likely to be swallowed by railway giants such as Germany's Deutsche Bahn - , namely Poland, Hungary and the Czech Republic.

CER, the Community of European Railways, welcomed the rejection of the draft regulation on freight quality as "an encouraging recognition of reality in the freight business". On the liberalization of international passenger traffic, CER said it was still concerned about "the pace and scope of the process". 

"The proposed extension of scope to national services seems incompatible with the principle of subsidiarity, as over 90% of rail passenger business is domestic," CER said in a statement.

The third railway package is made up of four legislative proposals, tabled by the Commission in March 2004:

  • A draft directive opening the market for international passenger rail traffic as of 2010 (EP Rapporteur: Georg JARZEMBOWSKI, EPP-ED, Germany);
  • A draft directive on the certification of skills for train drivers and crew (EP Rapporteur: Gilles SAVARY, PES, France)
  • A draft regulation on passenger rights for international routes (EP Rapporteur: Dirk STERCKX, ALDE, Belgium);
  • A draft regulation on the quality of freight services (EP Rapporteur: Roberts ZILE, UEN, Latvia);
  • 6 October: EU transport ministers to debate the package, including liberalisation aspects. The ministers are not expected to reach a common position at this meeting.
  • If, as expected, ministers amend the package, it will go back to Parliament for a second reading

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