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Document 52013SC0011
COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the documents Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1370/2007 concerning the opening of the market for domestic passenger transport services by rail Proposal for a Directive of the European Parliament and of the Council amending Directive 2012/34/EU of the European Parliament and of the Council of 21 November 2012 establishing a single European railway area, as regards the opening of the market for domestic passenger transport services by rail and the governance of the railway infrastructure
COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the documents Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1370/2007 concerning the opening of the market for domestic passenger transport services by rail Proposal for a Directive of the European Parliament and of the Council amending Directive 2012/34/EU of the European Parliament and of the Council of 21 November 2012 establishing a single European railway area, as regards the opening of the market for domestic passenger transport services by rail and the governance of the railway infrastructure
COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the documents Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1370/2007 concerning the opening of the market for domestic passenger transport services by rail Proposal for a Directive of the European Parliament and of the Council amending Directive 2012/34/EU of the European Parliament and of the Council of 21 November 2012 establishing a single European railway area, as regards the opening of the market for domestic passenger transport services by rail and the governance of the railway infrastructure
/* SWD/2013/011 final */
COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the documents Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1370/2007 concerning the opening of the market for domestic passenger transport services by rail Proposal for a Directive of the European Parliament and of the Council amending Directive 2012/34/EU of the European Parliament and of the Council of 21 November 2012 establishing a single European railway area, as regards the opening of the market for domestic passenger transport services by rail and the governance of the railway infrastructure /* SWD/2013/011 final */
COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the documents Proposal for a Regulation of the
European Parliament and of the Council amending Regulation (EC) No 1370/2007
concerning the opening of the market for domestic passenger transport services
by rail
Proposal for a Directive of the European Parliament and of the Council amending
Directive 2012/34/EU of the European Parliament and of the Council of 21
November 2012 establishing a single European railway area, as regards the
opening of the market for domestic passenger transport services by rail and the
governance of the railway infrastructure Lead DG: MOVE
1.
Problem definition
The performance of the railway sector in
passenger transportation does not compare favourably to other transport modes.
The 6% modal share for rail in the EU has remained fairly stable since the
mid-nineties and contrasts sharply to the share of passenger cars (75%), buses
(8%) and air transport (8%). Some countries have opened their domestic
passenger transport market, while markets of other Member states are dominated
by incumbents. , There are two main problems behind these
issues. Firstly, low quality of rail passenger services is observed widely
across the EU. A survey in 2012 revealed that only 46% of Europeans are
satisfied with their national and regional rail system. Secondly, operational
efficiency gaps of railway undertakings are observed within the wide range of
different national models in Europe. Despite large subsidies of railways, many
railway undertakings across the EU have been making losses for several years
and, in some instances, have had to be repeatedly bailed out by taxpayers. There is concurring evidence that these
problems are driven by lack of competitive pressure and different market access
rules across the EU hindering the consolidation of Single European Railway
Area. In 16 out of the 25 Member States (MS) with rail, incumbent operators'
market share remains above 90%. In such conditions, neither the competition for
the market (several operators competing for the exclusive right of a specific
route – a public service contract (PSC)) nor competition in the
market (several operators running in the same route – open access) can
be ensured. Also, since 1990 the efficiency gap between best and worst
performers of the EU railways has increased, revealing differing development
trends. The root causes of these problems can be
found in absence of competition for PSCs, market distortions caused by
restricted access to necessary resources (such as rolling stock and integrated
ticketing systems) and national restrictions to the freedom to provide domestic
passenger rail services. Today, 42% of all the EU domestic passenger market is operated
under PSOs attributed through direct awards. In addition, at least in 9 MS the
incumbent operator appears to still enjoy a domestic passenger services
monopoly laid down in the national legislation. These
problems and the measures to be proposed to address them will affect a large
number of actors in the rail market and beyond. In particular, they concern
railway undertakings, passengers and the railway manufacturing industry. More
fundamentally, these measures will also affect the way authorities manage
public financing of the railway sector.
2.
Subsidiarity
Articles 58, 90 and 100 of the Treaty
extend to railways the objectives of a genuine internal market in the context
of an EU Common Transport Policy. Actions by MS alone cannot ensure the
coherence of EU railway market and address the divergent interpretation of the
legislation, given the persistence of national rules and sub-optimal
functioning of national institutions, acting as barriers to the internal
market. Action at EU level aims to ensure consistent implementation of the EU
rail acquis, which should lead to the creation of the Single European
Railway Area (SERA) with no unnecessary administrative and technical barriers.
At the same time compliance with subsidiarity principle is carefully assessed
for the PSC related market opening measures which are geared towards maximum
flexibility to be left to MS.
3.
Objectives
General
objective: Improve the quality of rail passenger
services and enhance their operational efficiency thereby improving the
competitiveness and attractiveness of rail sector vis-à-vis other modes and
developing further the SERA. Specific objectives: 1.
Intensify competitive pressure on domestic rail
markets 2.
Create more uniform business conditions Operational
objectives: 1.
Facilitate cross-border entry into domestic rail
passenger markets 2.
Abolish legal monopolies 3.
Open PSC market for competition 4.
Establish a common approach to control the
definition of PSOs and to define public service contracts 5.
Facilitate the level playing field in access to ticketing 6.
Facilitate the level playing field in access to rolling
stock Mapping drivers, root causes and objectives:
4.
Policy options
Taking into account the stakeholders'
consultation and the problem analysis, it is possible to identify four broad
sets of measures, as detailed in the following table: Root causes || Respective category of options || Policy options considered || Retained? Restrictions to provision domestic passenger rail services || A options: Open access || Option A0: Baseline scenario - no open access rights to domestic rail market provided under EU law || √ Option A1: Open access with possibility to limit access when the viability of PSC is compromised || √ Option A2: Open access limited to routes being commercially viable || Option A3: Open access limited to routes not covered by PSCs || √ Option A4: Open access unlimited || Absence of competition for PSCs || B options: Competitive tendering of PSCs || Option B0: Baseline scenario - competent authorities can choose between direct award and competitive tendering || √ Option B1: Mandatory tendering with flexibility, PSC scope under the control of national regulatory body || √ Option B2: Mandatory tendering with flexibility, PSC scope under the control of the Commission || Discriminatory access to ticketing systems || T options: Integration of ticketing systems || Option T0: Baseline - implementation of the Passenger Rights Regulation and the Recast of the 1st Railway Package || √ Option T1: voluntary national integrated ticketing systems || √ Option T2: mandatory national integrated ticketing systems || √ Option T3:Integrated EU ticketing system || Limited access to rolling stock || RS options: Access to rolling stock || Option RS0: Baseline - no specific EU requirements || √ Option RS1: Mandatory creation of ROSCOs || Option RS2: Mandatory ownership of rolling stock by competent authorities || Option RS3: Mandatory selling or leasing of rolling stock by the previous PSC beneficiary || √ Option RS4: Obligation for the competent authority to take the financial risks || √ Option RS5: Guidelines on best practices on rolling stock || A and B options are the core measures of
the initiative and their combination determines the ambition of market opening.
The following combined core options are to be assessed: Option 0 (A0, B0) || – || Baseline scenario Option 1 (A1, B0) || – || Market opening based on 'broad open access', no measures on competitive tendering of PSCs Option 2 (A3, B0) || – || Market opening based on 'limited open access', no measures on competitive tendering of PSCs Option 3 (A0, B1) || – || Market opening based exclusively on competitive tendering of PSCs Option 4 (A1, B1) || – || Market opening based on 'broad open access' and competitive tendering of PSCs Option 5 (A3, B1) || – || Market opening based on 'limited open access' and competitive tendering of PSCs The essence of the ticketing and rolling
stock option consideration is to create framework conditions necessary for more
effective application of A and B core policy options. Core
options combined with the preferred options T and RS:
5.
Assessment of impacts
While the EU rules would create necessary
conditions for more effective and uniform rail market functioning, the
effectiveness of implementation and consequent impacts depend largely on the
situation in each MS and the 'spirit' of transposition and enforcement.
Consequently, the analysis of impacts of different options is mostly based on
qualitative assessment, with partial quantification, where possible. The direct economic, social
and environmental impacts that have been identified as potentially most
relevant to the policy measures are detailed in the tables below. Assessment
of direct economic and social impacts || Option 0 Baseline scenario || Option 1 Broad open access only || Option 2 limited open access only || Option 3 Competitive tendering only || Option 4 Broad open access and competitive tendering || Option 5 limited open access and competitive tendering Direct economic impacts Competition || 0 || +/++ || + || ++ || ++++ || +++ Transport demand || 0 || + || + || + || ++ || ++ Industry revenues and costs || 0 || + || + || ++ || +++ || +++ Public funding || 0 || + || 0/+ || ++ || ++ || +++ Investment in rail || 0 || + || + || + || ++ || ++ Administrative costs for operators || 0 || 0/+ || 0/+ || -- || - || -- Administrative costs for public authorities || 0 || 0 || 0 || -- || - || -- Multinational rail activities || 0 || + || + || +++ || ++++ || ++++ Small and medium enterprises || 0 || 0/+ || 0/+ || + || + || + Direct social impacts Passenger fares || 0 || + || 0/+ || 0 || + || 0/+ Service quality || 0 || + || 0/+ || + || ++ || ++ Employment - rail undertakings || 0 || 0 || 0 || -/+ || -/+ || -/+ Employment – rail-related sectors || 0 || + || + || + || ++ || ++ Working conditions || 0 || - || - || -- || -- || -- Rail safety || 0 || 0 || 0 || 0 || 0 || 0 Impact of
ticketing options Impact of ticketing options || T0 Baseline scenario || T1 Voluntary integration || T2 Mandatory integration Economic impacts Competition and other competition-driven impacts || 0 || ++ || + Industry revenues and costs || 0 || 0 || - Transport demand, multinational rail activities || 0 || 0 || 0 Administrative costs for public authorities || 0 || 0 || - Innovation || 0 || + || 0 Social impacts Passenger fares || 0 || 0/+ || 0/- Service quality || 0 || + || 0/+ Impact of
rolling stock options || RS1 Baseline scenario || RS3 Mandatory transfer || RS4 Risk for contracting entity Economic impacts Competition and other competition-driven impacts || 0 || + || ++ Public funding || 0 || - || -- Multinational rail activities || 0 || + || + Property rights || 0 || - || 0 Industry revenues and costs || 0 || 0 || + Innovation || 0 || 0/- || 0/- Social impacts Safety || 0 || 0 || 0
6.
Comparison of options
The following table compares the options in
terms of effectiveness, efficiency and coherence. Comparison of market opening options || Effectiveness [1] || Efficiency || Coherence || Motivation SO1: Intensify competitive pressure in domestic rail markets || SO2: Create more uniform business conditions || Operational efficiency of RUs || Passenger fares || Administrative burdens for operators || Administrative burdens for public authorities || Employment and working conditions (rail) || Employment (rail related sectors) || Social inclusion, customer impacts || Environmental sustainability Option 0 Baseline scenario || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0 || 0 || No new bidders would appear for competitive tenders and no improvements in public spending efficiency in rail. Disparity of market structures throughout the MS remains. Option 1 Broad open access only || +/++ || + || + || + || 0/+ || 0 || 0 || + || + || 0/+ || Positive impacts on competitiveness of rail market. However, the measure would not result in a major restructuring of the rail sector and provide for only limited efficiency and administrative gains. Option 2 Limited open access only || + || + || + || 0/+ || 0/+ || 0 || 0 || + || + || 0/+ || Impacts are similar to that of Option 1, but even more limited. PSCs will remain protected from competition with open access operators, so no savings in public funds are assumed. Option 3 Competitive tendering only || ++ || +++ || ++ || 0 || -- || -- || -/+ || + || ++ || + || Option addresses only the usage of PSCs, and thus only partially improves entry rights. Competitive tendering is expected to result in improved efficiency, especially felt by incumbents. Customer fares will remain the same; administrative burden may increase. Social inclusion and environmental sustainability are linked to expected slight increase in rail service provision. Option 4 Broad open access and competitive tendering || ++++ || ++++ || +++ || + || - || - || -/+ || ++ || ++ || +/++ || The most ambitious option addressing both – PSCs and open access – and the most effective in terms of specific objectives. It will promote elimination of monopoly profits of incumbents and create opportunities for new entrants. Reinvesting the saved money in rail sector could provide for additional services. Impacts on employment are linked to industry revenue developments. Option 5 Limited open access and competitive tendering || +++ || ++++ || ++/+++ || 0/+ || -- || -- || -/+ || ++ || ++ || +/++ || Option 5 is similar to Option 4, allowing, however, competition between open access rights and PSCs. Fewer benefits are expected in the form of public savings and operational efficiency. Impacts on employment are largely the same as under Option 3. Comparison of ticketing options || Effectiveness || Efficiency || Coherence || Motivation SO1: Intensify competitive pressure in domestic rail markets || SO2: Create more uniform business conditions || Operational efficiency of RUs || Passenger fares || Administrative burdens for public authorities || Service quality T0 Baseline scenario || 0 || 0 || 0 || 0 || 0 || 0 || Implementation of the Passenger Rights Regulation and the Recast of the 1st Railway Package would mean marginal improvement. T1 Voluntary integration || ++ || 0 || + || 0/+ || 0 || +/- || T1 would achieve less harmonisation of approaches, but leave more room for competition. A voluntary option would maintain a more fragmented market and hinder 'seamless travel'. T2 Mandatory integration || + || 0 || 0 || 0/- || - || 0/+ || Mandatory ticketing systems would provide means for a 'seamless travel' but could reduce margins for price competition. May hamper the possibility of open access operators to develop their own business strategies. Mandatory systems could result in disproportional cost. Comparison of rolling stock options || Effectiveness || Efficiency || Coherence || Motivation SO1: Intensify competitive pressure in domestic rail markets || SO2: Create more uniform business conditions || Operational efficiency of RUs || Public Funding || Safety || Property rights || Innovation RS0 Baseline scenario || 0 || 0 || 0 || 0 || 0 || 0 || 0 || Access to rolling stock remains a major barrier in many countries, hindering competition. RS3 Mandatory transfer || + || + || 0/- || - || 0 || - || 0/- || RS3 and RS4 both provide for equal level playing field as regards access to rolling stock, increasing the potential number of bidders and harmonising business conditions. Improvement is expected in the efficiency of public funding. Option RS3 adds costs to operators and involves the withdrawal of property of rolling stock from existing incumbents, which may result in possible conflicts. RS4 Risk for contracting entity || ++ || + || 0/- || -- || 0 || 0 || 0/- || This option would ease access to rolling stock more effectively than RS3, however, given that the financial risks, there will be more pressure on public funds. To minimise costs, contracting authorities might prefer using old rolling stock and this would hinder innovation. Conclusion The analysis shows that the following
options perform best: ·
Option 4 Market
opening based on broad 'open access' and competitive tendering of PSCs ·
T1 Voluntary national integrated ticketing systems ·
RS3 Mandatory
transfer of rolling stock or RS4 Obligation for the competent authority
to take the rolling stock related financial risks As already explained,
there is a certain degree of uncertainty in the assessment of impacts of some
options, as evidence is sometimes fairly recent (e.g. competition in the
market) or ambiguous (evidence provided only by specific stakeholders). The
choice to move forward with the aforementioned combination remains thus a
political choice. Estimates of the impacts of the preferred policy scenario A scenario analysis
accompanied with sensitivity tests has allowed estimating the potential impacts
of the preferred policy scenario. Furthermore, the delivery of the full benefits
of market opening is also greatly helped by institutional separation and
coordination of infrastructure management, as proposed by another initiative
within the 4th Rail Package, resulting in the important following
synergies: Impacts of market opening and
infrastructure governance policies All changes are illustrative estimates || Financial benefits (NPV, € bn) || Increase in passenger km (bn) Scenario 1 –Focus on saving || Vertical separation alone || 6.6 || 0.8 Market Opening alone || 29.4 || 2.0 Combination of market opening and vertical separation || 43.4 || 3.8 Scenario 2 – Reinvestment (50% of savings reinvested into rail) || Vertical separation alone || 4.4 || 1.1 Market Opening alone || 21.0 || 8.4 Combination of market opening and vertical separation || 33.8 || 16.4 While
scenario 1 focuses only on financial benefits (consisting mostly of public
savings), the scenario 2 would allow to provide 16 billion additional
passenger-km (6% increase of passenger-km on top of the baseline developments).
7.
Monitoring and evaluation
The Commission will monitor and evaluate
the implementation and effectiveness of this legislation through a set of
indicator, which is in most cases aligned with those defined in the State Aid
Scoreboard, Regulation 1370/2007 and Rail Market Monitoring System[2]. Specific objective || Indicator SO1: Intensify competitive pressure in domestic rail markets || · Market share of new entrants* (relates to operational objective OO1, OO3) · Rail services covered by PSCs* (relates to OO3 and OO4) · Utilisation of access rights*(relates to OO1, OO2, OO3) · Barriers to more effective rail* (relates to all operational objectives) · Licensing* (relates to OO1, OO2) SO2: Create more uniform business conditions || · Rail services covered by PSCs* · Utilisation of access rights* · Barriers to more effective rail* Other parameters || Working conditions || · Dynamics of employment* (e.g. increase or decrease in employment) · Social conditions* * As foreseen in
Article 15 of the Recast of the 1st Railway Package It is planned that five years after the end
of the transition period of its legislative proposals, the Commission will
evaluate whether the objectives of the initiative have been achieved. [1] Effectiveness scores are linked to following
categories of economic impacts: competition, use of public funds, demand for
rail services/modal share of rail and development of multinational rail
activities. [2] As reviewed by the Recast of the 1st Railway Package