(1)

Article 16 of the Treaty confirms the place occupied by services of general economic interest in the shared values of the Union.

(2)

Article 86(2) of the Treaty lays down that undertakings entrusted with the operation of services of general economic interest are subject to the rules contained in the Treaty, in particular to the rules on competition, in so far as the application of such rules does not obstruct the performance, in law or in fact, of the particular tasks assigned to them.

(3)

Article 73 of the Treaty constitutes a lex specialis in relation to Article 86(2). It establishes rules applicable to the compensation of public service obligations in inland transport.

(4)

The main objectives of the Commission’s White Paper of 12 September 2001‘European transport policy for 2010: time to decide’ are to guarantee safe, efficient and high-quality passenger transport services through regulated competition, guaranteeing also transparency and performance of public passenger transport services, having regard to social, environmental and regional development factors, or to offer specific tariff conditions to certain categories of traveller, such as pensioners, and to eliminate the disparities between transport undertakings from different Member States which may give rise to substantial distortions of competition.

(5)

At the present time, many inland passenger transport services which are required in the general economic interest cannot be operated on a commercial basis. The competent authorities of the Member States must be able to act to ensure that such services are provided. The mechanisms that they can use to ensure that public passenger transport services are provided include the following: the award of exclusive rights to public service operators, the grant of financial compensation to public service operators and the definition of general rules for the operation of public transport which are applicable to all operators. If Member States, in accordance with this Regulation, choose to exclude certain general rules from its scope, the general regime for State aid should apply.

(6)

Many Member States have enacted legislation providing for the award of exclusive rights and public service contracts in at least part of their public transport market, on the basis of transparent and fair competitive award procedures. As a result, trade between Member States has developed significantly and several public service operators are now providing public passenger transport services in more than one Member State. However, developments in national legislation have led to disparities in the procedures applied and have created legal uncertainty as to the rights of public service operators and the duties of the competent authorities. Regulation (EEC) No 1191/69 of the Council of 26 June 1969 on action by Member States concerning the obligations inherent in the concept of a public service in transport by rail, road and inland waterway (4), does not deal with the way public service contracts are to be awarded in the Community, and in particular the circumstances in which they should be the subject of competitive tendering. The Community legal framework ought therefore to be updated.

(7)

Studies carried out and the experience of Member States where competition in the public transport sector has been in place for a number of years show that, with appropriate safeguards, the introduction of regulated competition between operators leads to more attractive and innovative services at lower cost and is not likely to obstruct the performance of the specific tasks assigned to public service operators. This approach has been endorsed by the European Council under the Lisbon Process of 28 March 2000 which called on the Commission, the Council and the Member States, each in accordance with their respective powers, to ‘speed up liberalisation in areas such as … transport’.

(8)

Passenger transport markets which are deregulated and in which there are no exclusive rights should be allowed to maintain their characteristics and way of functioning in so far as these are compatible with Treaty requirements.

(9)

In order to be able to organise their public passenger transport services in the manner best suited to the needs of the public, all competent authorities must be able to choose their public service operators freely, taking into account the interests of small and medium-sized enterprises, under the conditions stipulated in this Regulation. In order to guarantee the application of the principles of transparency, equal treatment of competing operators and proportionality, when compensation or exclusive rights are granted, it is essential that a public service contract between the competent authority and the chosen public service operator defines the nature of the public service obligations and the agreed reward. The form or designation of the contract may vary according to the legal systems of the Member States.

(10)

Contrary to Regulation (EEC) No 1191/69, the scope of which extends to public passenger transport services by inland waterway, it is not considered advisable for this Regulation to cover the award of public service contracts in that specific sector. The organisation of public passenger transport services by inland waterway and, in so far as they are not covered by specific Community law, by national sea water is therefore subject to compliance with the general principles of the Treaty, unless Member States choose to apply this Regulation to those specific sectors. The provisions of this Regulation do not prevent the integration of services by inland waterway and national sea water into a wider urban, suburban or regional public passenger transport network.

(11)

Contrary to Regulation (EEC) No 1191/69, the scope of which extends to freight transport services, it is not considered advisable for this Regulation to cover the award of public service contracts in that specific sector. Three years after the entry into force of this Regulation the organisation of freight transport services should therefore be made subject to compliance with the general principles of the Treaty.

(12)

It is immaterial from the viewpoint of Community law whether public passenger transport services are operated by public or private undertakings. This Regulation is based on the principles of neutrality as regards the system of property ownership referred to in Article 295 of the Treaty, of the freedom of Member States to define services of general economic interest, referred to in Article 16 of the Treaty, and of subsidiarity and proportionality referred to in Article 5 of the Treaty.

(13)

Some services, often linked to specific infrastructure, are operated mainly for their historical interest or tourist value. As the purpose of these operations is manifestly different from the provision of public passenger transport, they need not therefore be governed by the rules and procedures applicable to public service requirements.

(14)

Where the competent authorities are responsible for organising the public transport network, apart from the actual operation of the transport service, this may cover a whole range of other activities and duties that the competent authorities must be free either to carry out themselves or entrust, in whole or in part, to a third party.

(15)

Contracts of long duration can lead to market foreclosure for a longer period than is necessary, thus diminishing the benefits of competitive pressure. In order to minimise distortions of competition, while protecting the quality of services, public service contracts should be of limited duration. The extension of such contracts could be subject to positive confirmation from users. In this context, it is necessary to make provision for extending public service contracts by a maximum of half their initial duration where the public service operator must invest in assets for which the depreciation period is exceptional and, because of their special characteristics and constraints, in the case of the outermost regions as specified in Article 299 of the Treaty. In addition, where a public service operator makes investments in infrastructure or in rolling stock and vehicles which are exceptional in the sense that both concern high amounts of funds, and provided the contract is awarded after a fair competitive tendering procedure, an even longer extension should be possible.

(16)

Where the conclusion of a public service contract may entail a change of public service operator, it should be possible for the competent authorities to ask the chosen public service operator to apply the provisions of Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfer of undertakings, businesses or parts of undertakings or businesses (5). This Directive does not preclude Member States from safeguarding transfer conditions of employees’ rights other than those covered by Directive 2001/23/EC and thereby, if appropriate, taking into account social standards established by national laws, regulations or administrative provisions or collective agreements or agreements concluded between social partners.

(17)

In keeping with the principle of subsidiarity, competent authorities are free to establish social and qualitative criteria in order to maintain and raise quality standards for public service obligations, for instance with regard to minimal working conditions, passenger rights, the needs of persons with reduced mobility, environmental protection, the security of passengers and employees as well as collective agreement obligations and other rules and agreements concerning workplaces and social protection at the place where the service is provided. In order to ensure transparent and comparable terms of competition between operators and to avert the risk of social dumping, competent authorities should be free to impose specific social and service quality standards.

(18)

Subject to the relevant provisions of national law, any local authority or, in the absence thereof, any national authority may choose to provide its own public passenger transport services in the area it administers or to entrust them to an internal operator without competitive tendering. However, this self-provision option needs to be strictly controlled to ensure a level playing field. The competent authority or group of authorities providing integrated public passenger transport services, collectively or through its members, should exercise the required control. In addition, a competent authority providing its own transport services or an internal operator should be prohibited from taking part in competitive tendering procedures outside the territory of that authority. The authority controlling the internal operator should also be allowed to prohibit this operator from taking part in competitive tenders organised within its territory. Restrictions on the activities of an internal operator do not interfere with the possibility of directly awarding public service contracts where they concern transport by rail, with the exception of other track-based modes such as metro or tramways. Furthermore, the direct award of public service contracts for heavy rail does not preclude the possibility for competent authorities to award public service contracts for public passenger transport services on other track-based modes, such as metro and tramway, to an internal operator.

(19)

Subcontracting can contribute to more efficient public passenger transport and makes it possible for undertakings to participate, other than the public service operator which was granted the public service contract. However, with a view to the best use of public funds, competent authorities should be able to determine the modalities for subcontracting their public passenger transport services, in particular in the case of services performed by an internal operator. Furthermore, a subcontractor should not be prevented from taking part in competitive tenders in the territory of any competent authority. The selection of a subcontractor by the competent authority or its internal operator needs to be carried out in accordance with Community law.

(20)

Where a public authority chooses to entrust a general interest service to a third party, it must select the public service operator in accordance with Community law on public contracts and concessions, as established by Articles 43 to 49 of the Treaty, and the principles of transparency and equal treatment. In particular, the provisions of this Regulation are to be without prejudice to the obligations applicable to public authorities by virtue of the directives on the award of public contracts, where public service contracts fall within their scope.

(21)

Effective legal protection should be guaranteed, not only for awards falling within the scope of Directive 2004/17/EC of the European Parliament and of the Council of 31 March 2004 coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors (6) and Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts (7), but also for other contracts awarded under this Regulation. An effective review procedure is needed and should be comparable, where appropriate, to the relevant procedures set out in Council Directive 89/665/EEC of 21 December 1989 on the coordination of the laws, regulations and administrative provisions relating to the application of review procedures to the award of public supply and public works contracts (8) and Council Directive 92/13/EEC of 25 February 1992 coordinating the laws, regulations and administrative provisions relating to the application of Community rules on the procurement procedures of entities operating in the water, energy, transport and telecommunications sectors (9).

(22)

Some invitations to tender require the competent authorities to define and describe complex systems. These authorities should therefore have power, when awarding contracts in such cases, to negotiate details with some or all of the potential public service operators once tenders have been submitted.

(23)

Invitations to tender for the award of public service contracts should not be mandatory where the contract relates to modest amounts or distances. In this respect, greater amounts or distances should enable competent authorities to take into account the special interests of small and medium-sized enterprises. Competent authorities should not be permitted to split up contracts or networks in order to avoid tendering.

(24)

Where there is a risk of disruption in the provision of services, the competent authorities should have power to introduce emergency short-term measures pending the award of a new public service contract which is in line with all the conditions for awarding a contract laid down in this Regulation.

(25)

Public passenger transport by rail raises specific issues of investment burden and infrastructure cost. In March 2004, the Commission presented a proposal to amend Council Directive 91/440/EEC of 29 July 1991 on the development of the Community’s railways (10) so as to guarantee access for all Community railway undertakings to the infrastructure of all Member States for the purpose of operating international passenger services. The aim of this Regulation is to establish a legal framework for compensation and/or exclusive rights for public service contracts and not the further opening of the market for railway services.

(26)

In the case of public services, this Regulation allows each competent authority, within the context of a public service contract, to select its operator of public passenger transport services. Given the differences in the way Member States organise their territory in this respect, competent authorities may justifiably be allowed to award public service contracts directly for railway travel.

(27)

The compensation granted by competent authorities to cover the costs incurred in discharging public service obligations should be calculated in a way that prevents overcompensation. Where a competent authority plans to award a public service contract without putting it out to competitive tender, it should also respect detailed rules ensuring that the amount of compensation is appropriate and reflecting a desire for efficiency and quality of service.

(28)

By appropriately considering the effects of complying with the public service obligations on the demand for public passenger transport services in the calculation scheme set out in the Annex, the competent authority and the public service operator can prove that overcompensation has been avoided.

(29)

With a view to the award of public service contracts, with the exception of emergency measures and contracts relating to modest distances, the competent authorities should take the necessary measures to advertise, at least one year in advance, the fact that they intend to award such contracts, so as to enable potential public service operators to react.

(30)

Directly awarded public service contracts should be subject to greater transparency.

(31)

Given that competent authorities and public service operators will need time to adapt to the provisions of this Regulation, provision should be made for transitional arrangements. With a view to the gradual award of public service contracts in line with this Regulation, Member States should provide the Commission with a progress report within the six months following the first half of the transitional period. The Commission may propose appropriate measures on the basis of these reports.

(32)

During the transitional period, the application of the provisions of this Regulation by the competent authorities may take place at different times. It may therefore be possible, during this period, that public service operators from markets not yet affected by the provisions of this Regulation tender for public service contracts in markets that have been opened to controlled competition more rapidly. In order to avoid, by means of proportionate action, any imbalance in the opening of the public transport market, competent authorities should be able to refuse, in the second half of the transitional period, tenders from undertakings, more than half the value of the public transport services performed by which are not granted in accordance with this Regulation, provided that this is applied without discrimination and decided in advance of an invitation to tender.

(33)

In paragraphs 87 to 95 of its judgment of 24 July 2003 in Case C-280/00 Altmark Trans GmbH (11), the Court of Justice of the European Communities ruled that compensation for public service does not constitute an advantage within the meaning of Article 87 of the Treaty, provided that four cumulative conditions are satisfied. Where those conditions are not satisfied and the general conditions for the application of Article 87(1) of the Treaty are met, public service compensation constitutes State aid and is subject to Articles 73, 86, 87 and 88 of the Treaty.

(34)

Compensation for public services may prove necessary in the inland passenger transport sector so that undertakings responsible for public services operate on the basis of principles and under conditions which allow them to carry out their tasks. Such compensation may be compatible with the Treaty pursuant to Article 73 under certain conditions. Firstly, it must be granted to ensure the provision of services which are services of general interest within the meaning of the Treaty. Secondly, in order to avoid unjustified distortions of competition, it may not exceed what is necessary to cover the net costs incurred through discharging the public service obligations, taking account of the revenue generated thereby and a reasonable profit.

(35)

Compensation granted by the competent authorities in accordance with the provisions of this Regulation may therefore be exempted from the prior notification requirement of Article 88(3) of the Treaty.

(36)

This Regulation replaces Regulation (EEC) No 1191/69, which should therefore be repealed. For public freight transport services, a transitional period of three years will assist the phasing out of compensation not authorised by the Commission in accordance with Articles 73, 86, 87 and 88 of the Treaty. Any compensation granted in relation to the provision of public passenger transport services other than those covered by this Regulation which risks involving State aid within the meaning of Article 87(1) of the Treaty should comply with the provisions of Articles 73, 86, 87 and 88 thereof, including any relevant interpretation by the Court of Justice of the European Communities and especially its ruling in Case C-280/00 Altmark Trans GmbH. When examining such cases, the Commission should therefore apply principles similar to those laid down in this Regulation or, where appropriate, other legislation in the field of services of general economic interest.

(37)

The scope of Council Regulation (EEC) No 1107/70 of 4 June 1970 on the granting of aids for transport by rail, road and inland waterway (12) is covered by this Regulation. That Regulation is considered obsolete while limiting the application of Article 73 of the Treaty without granting an appropriate legal basis for authorising current investment schemes, in particular in relation to investment in transport infrastructure in a public private partnership. It should therefore be repealed in order for Article 73 of the Treaty to be properly applied to continuing developments in the sector without prejudice to this Regulation or Council Regulation (EEC) No 1192/69 of 26 June 1969 on common rules for the normalisation of the accounts of railway undertakings (13). With a view to further facilitating the application of the relevant Community rules, the Commission will propose State aid guidelines for railway investment, including investment in infrastructure in 2007.

(38)

With a view to assessing the implementation of this Regulation and the developments in the provision of public passenger transport in the Community, in particular the quality of public passenger transport services and the effects of granting public service contracts by direct award, the Commission should produce a report. This report may, if necessary, be accompanied by appropriate proposals for the amendment of this Regulation,

(a)

‘public passenger transport’ means passenger transport services of general economic interest provided to the public on a non-discriminatory and continuous basis;

(b)

‘competent authority’ means any public authority or group of public authorities of a Member State or Member States which has the power to intervene in public passenger transport in a given geographical area or any body vested with such authority;

(c)

‘competent local authority’ means any competent authority whose geographical area of competence is not national;

(d)

‘public service operator’ means any public or private undertaking or group of such undertakings which operates public passenger transport services or any public body which provides public passenger transport services;

(e)

‘public service obligation’ means a requirement defined or determined by a competent authority in order to ensure public passenger transport services in the general interest that an operator, if it were considering its own commercial interests, would not assume or would not assume to the same extent or under the same conditions without reward;

(f)

‘exclusive right’ means a right entitling a public service operator to operate certain public passenger transport services on a particular route or network or in a particular area, to the exclusion of any other such operator;

(g)

‘public service compensation’ means any benefit, particularly financial, granted directly or indirectly by a competent authority from public funds during the period of implementation of a public service obligation or in connection with that period;

(h)

‘direct award’ means the award of a public service contract to a given public service operator without any prior competitive tendering procedure;

(i)

‘public service contract’ means one or more legally binding acts confirming the agreement between a competent authority and a public service operator to entrust to that public service operator the management and operation of public passenger transport services subject to public service obligations; depending on the law of the Member State, the contract may also consist of a decision adopted by the competent authority:

(j)

‘internal operator’ means a legally distinct entity over which a competent local authority, or in the case of a group of authorities at least one competent local authority, exercises control similar to that exercised over its own departments;

(k)

‘value’ means the value of a service, a route, a public service contract, or a compensation scheme for public passenger transport corresponding to the total remuneration, before VAT, of the public service operator or operators, including compensation of whatever kind paid by the public authorities and revenue from the sale of tickets which is not repaid to the competent authority in question;

(l)

‘general rule’ means a measure which applies without discrimination to all public passenger transport services of the same type in a given geographical area for which a competent authority is responsible;

(m)

‘integrated public passenger transport services’ means interconnected transport services within a determined geographical area with a single information service, ticketing scheme and timetable.

(1)

In the framework of the common transport policy, it is important to safeguard users’ rights for rail passengers and to improve the quality and effectiveness of rail passenger services in order to help increase the share of rail transport in relation to other modes of transport.

(2)

The Commission’s communication ‘Consumer Policy Strategy 2002-2006’ (4) sets the aim of achieving a high level of consumer protection in the field of transport in accordance with Article 153(2) of the Treaty.

(3)

Since the rail passenger is the weaker party to the transport contract, passengers’ rights in this respect should be safeguarded.

(4)

Users’ rights to rail services include the receipt of information regarding the service both before and during the journey. Whenever possible, railway undertakings and ticket vendors should provide this information in advance and as soon as possible.

(5)

More detailed requirements regarding the provision of travel information will be set out in the technical specifications for interoperability (TSIs) referred to in Directive 2001/16/EC of the European Parliament and of the Council of 19 March 2001 on the interoperability of the conventional rail system (5).

(6)

Strengthening of the rights of rail passengers should build on the existing system of international law on this subject contained in Appendix A — Uniform rules concerning the Contract for International Carriage of Passengers and Luggage by Rail (CIV) to the Convention concerning International Carriage by Rail (COTIF) of 9 May 1980, as modified by the Protocol for the modification of the Convention concerning International Carriage by Rail of 3 June 1999 (1999 Protocol). However, it is desirable to extend the scope of this Regulation and protect not only international passengers but domestic passengers too.

(7)

Railway undertakings should cooperate to facilitate the transfer of rail passengers from one operator to another by the provision of through tickets, whenever possible.

(8)

The provision of information and tickets for rail passengers should be facilitated by the adaptation of computerised systems to a common specification.

(9)

The further implementation of travel information and reservation systems should be executed in accordance with the TSIs.

(10)

Rail passenger services should benefit citizens in general. Consequently, disabled persons and persons with reduced mobility, whether caused by disability, age or any other factor, should have opportunities for rail travel comparable to those of other citizens. Disabled persons and persons with reduced mobility have the same right as all other citizens to free movement, freedom of choice and to non-discrimination. Inter alia, special attention should be given to the provision of information to disabled persons and persons with reduced mobility concerning the accessibility of rail services, access conditions of rolling stock and the facilities on board. In order to provide passengers with sensory impairment with the best information on delays, visual and audible systems should be used, as appropriate. Disabled persons and persons with reduced mobility should be enabled to buy tickets on board a train without extra charges.

(11)

Railway undertakings and station managers should take into account the needs of disabled persons and persons with reduced mobility, through compliance with the TSI for persons with reduced mobility, so as to ensure that, in accordance with Community public procurement rules, all buildings and rolling stock are made accessible through the progressive elimination of physical obstacles and functional hindrances when acquiring new material or carrying out construction or major renovation work.

(12)

Railway undertakings should be obliged to be insured, or to make equivalent arrangements, for their liability to rail passengers in the event of accident. The minimum amount of insurance for railway undertakings should be the subject of future review.

(13)

Strengthened rights of compensation and assistance in the event of delay, missed connection or cancellation of a service should lead to greater incentives for the rail passenger market, to the benefit of passengers.

(14)

It is desirable that this Regulation create a system of compensation for passengers in the case of delay which is linked to the liability of the railway undertaking, on the same basis as the international system provided by the COTIF and in particular appendix CIV thereto relating to passengers’ rights.

(15)

Where a Member State grants railway undertakings an exemption from the provisions of this Regulation, it should encourage railway undertakings, in consultation with organisations representing passengers, to put in place arrangements for compensation and assistance in the event of major disruption to a rail passenger service.

(16)

It is also desirable to relieve accident victims and their dependants of short-term financial concerns in the period immediately after an accident.

(17)

It is in the interests of rail passengers that adequate measures be taken, in agreement with public authorities, to ensure their personal security at stations as well as on board trains.

(18)

Rail passengers should be able to submit a complaint to any railway undertaking involved regarding the rights and obligations conferred by this Regulation, and be entitled to receive a response within a reasonable period of time.

(19)

Railway undertakings should define, manage and monitor service quality standards for rail passenger services.

(20)

The contents of this Regulation should be reviewed in respect of the adjustment of financial amounts for inflation and in respect of information and service quality requirements in the light of market developments as well as in the light of the effects on service quality of this Regulation.

(21)

This Regulation should be without prejudice to Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data (6).

(22)

Member States should lay down penalties applicable to infringements of this Regulation and ensure that these penalties are applied. The penalties, which might include the payment of compensation to the person in question, should be effective, proportionate and dissuasive.

(23)

Since the objectives of this Regulation, namely the development of the Community’s railways and the introduction of passenger rights, cannot be sufficiently achieved by the Member States, and can therefore be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve those objectives.

(24)

It is an aim of this Regulation to improve rail passenger services within the Community. Therefore, Member States should be able to grant exemptions for services in regions where a significant part of the service is operated outside the Community.

(25)

Railway undertakings in some Member States may experience difficulty in applying the entirety of the provisions of this Regulation on its entry into force. Therefore, Member States should be able to grant temporary exemptions from the application of the provisions of this Regulation to long-distance domestic rail passenger services. The temporary exemption should, however, not apply to the provisions of this Regulation that grant disabled persons or persons with reduced mobility access to travel by rail, nor to the right of those wishing to purchase tickets for travel by rail to do so without undue difficulty, nor to the provisions on railway undertakings’ liability in respect of passengers and their luggage, the requirement that undertakings be adequately insured, and the requirement that those undertakings take adequate measures to ensure passengers’ personal security in railway stations and on trains and to manage risk.

(26)

Urban, suburban and regional rail passenger services are different in character from long-distance services. Therefore, with the exception of certain provisions which should apply to all rail passenger services throughout the Community, Member States should be able to grant exemptions from the application of the provisions of this Regulation to urban, suburban and regional rail passenger services.

(27)

The measures necessary for the implementation of this Regulation should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission (7).

(28)

In particular, the Commission should be empowered to adopt implementing measures. Since those measures are of general scope and are designed to amend non-essential elements of this Regulation, or to supplement it with new non-essential elements, they must be adopted in accordance with the regulatory procedure with scrutiny provided for in Article 5a of Decision 1999/468/EC,

(1)

In accordance with the Lisbon Strategy, and as confirmed by the mid-term review of that strategy in 2005, Europe must focus its policies further on growth and employment in order to achieve the Lisbon goals.

(2)

The development of the Community and the operation of the internal market increase the need for comparable data which allow the impact of the structure and distribution of wages on the labour market to be assessed, particularly as a means of analysing progress as regards economic and social cohesion.

(3)

In order to carry out the tasks assigned to it, the Commission requires data on the ranking of wages by socio-economic characteristics and also in relation to different forms of paid employment, which are essential to analyse and understand the labour market and the changes taking place in the structure of the labour force. In this regard, the advantages of having data on wages by deciles in relation to other employment characteristics are widely recognised.

(4)

The Community Labour Force Survey is essentially the first and most authoritative reference source for labour market information in the European Union, and information on wages, as a fundamental variable to explain labour market behaviour, should be a standard element of this survey in order to allow for a more complete analysis of labour markets.

(5)

The Statistical Programme Committee, established by Council Decision 89/382/EEC, Euratom (2), has been consulted in accordance with Article 3 of that Decision.

(6)

Council Regulation (EC) No 577/98 (3) should therefore be amended accordingly,

1)

in Article 4(1), point (l) shall be replaced by the following:

2)

Article 6 shall be replaced by the following:

(1)

Council Directive 91/440/EEC of 29 July 1991 on the development of the Community’s railways (4) was designed to facilitate the adaptation of the Community’s railways to the requirements of the single market and to improve their efficiency.

(2)

Directive 2001/14/EC of the European Parliament and of the Council of 26 February 2001 on the allocation of railway infrastructure capacity and the levying of charges for the use of railway infrastructure (5) concerns the principles and procedures to be applied with regard to the setting and charging of railway infrastructure charges and the allocation of railway infrastructure capacity.

(3)

In its White Paper European transport policy for 2010: time to decide, the Commission announced its intention to continue building the internal market in rail services by proposing to open up the market in international passenger services.

(4)

The aim of this Directive is to address the opening of the market for international rail passenger services within the Community, and it should therefore not concern services between a Member State and a third country. In addition, Member States should be able to exclude from the scope of this Directive services transiting the Community.

(5)

International rail services currently present a very contrasting picture. Long-distance services (for instance night trains) are in difficulty and several of them have recently been withdrawn by the railway undertakings operating them in order to limit losses. The market for international high-speed services, on the other hand, has seen a sharp increase in traffic and will continue its vigorous development with the doubling and interconnection of the trans-European high-speed network by 2010. Nevertheless, there is strong competitive pressure from low-cost airlines in both cases. It is therefore essential to stimulate new initiatives by promoting competition between railway undertakings.

(6)

It is not possible to open up the market in international passenger services without detailed provisions on infrastructure access, substantial progress on interoperability and a strict framework for rail safety at national and European level. All of these elements are now in place following the transposition of Directive 2001/12/EC (6) of the European Parliament and of the Council of 26 February 2001 amending Council Directive 91/440/EEC, Directive 2004/51/EC (7) of the European Parliament and of the Council of 29 April 2004 amending Council Directive 91/440/EEC, Directive 2001/13/EC (8) of the European Parliament and of the Council of 26 February 2001 amending Council Directive 95/18/EC, Directive 2001/14/EC, and Directive 2004/49/EC of the European Parliament and of the Council of 29 April 2004 on safety on the Community’s railways (9). It is necessary for this new regulatory framework to be supported by established, consolidated practice by the proposed date for opening up the market for international passenger services. This will require a certain time. The target date for opening up the market should therefore be 1 January 2010.

(7)

The number of railway services without intermediate stops is very limited. In the case of journeys with intermediate stops, it is essential to authorise new market entrants to pick up and set down passengers along the route in order to ensure that such operations have a realistic chance of being economically viable and to avoid placing potential competitors at a disadvantage to existing operators, which have the right to pick up and set down passengers along the route. This right should be without prejudice to Community and national regulations concerning competition policy.

(8)

The introduction of new, open-access, international services with intermediate stops should not be used to bring about the opening of the market for domestic passenger services, but should merely be focused on stops that are ancillary to the international route. On that basis, their introduction should concern services whose principal purpose is to carry passengers travelling on an international journey. The determination of whether that is the service’s principal purpose should take into account criteria such as the proportion of turnover, and of volume, derived from transport of domestic or international passengers, and the length of the service. This determination should be made by the respective national regulatory body at the request of an interested party.

(9)

Regulation (EC) No 1370/2007 of the European Parliament and of the Council of 23 October 2007 on public passenger transport services by rail and by road (10) authorises Member States and local authorities to award public service contracts. These contracts may contain exclusive rights to operate certain services. It is therefore necessary to ensure that the provisions of that Regulation are consistent with the principle of opening up international passenger services to competition.

(10)

Opening up international passenger services, which include the right to pick up passengers at any station located on the route of an international service and to set them down at another, including stations located in the same Member State, to competition may have implications for the organisation and financing of rail passenger services provided under a public service contract. Member States should have the possibility to limit the right of access to the market where this right would compromise the economic equilibrium of these public service contracts and where approval is given by the relevant regulatory body referred to in Article 30 of Directive 2001/14/EC on the basis of an objective economic analysis, following a request from the competent authorities that awarded the public service contract.

(11)

Some Member States have already moved towards opening up the market for rail passenger services by transparent, open competitive tendering for the provision of certain such services. They should not have to provide full open access to international passenger services, since this competition for the right to use certain rail routes has involved a sufficient test of the market value of running those services.

(12)

The assessment of whether the economic equilibrium of the public service contract could be compromised should take into account predetermined criteria such as the impact on the profitability of any services which are included in a public service contract, including consequential impacts on the net cost to the competent public authority that awarded the contract, passenger demand, ticket pricing, ticketing arrangements, location and number of stops on both sides of the border and timing and frequency of the proposed new service. Respecting such an assessment and the decision of the relevant regulatory body, Member States might authorise, modify or deny the right of access for the international passenger service sought, including the levying of a charge on the operator of a new international passenger service, in line with the economic analysis and in accordance with Community law and the principles of equality and non-discrimination.

(13)

In order to contribute to the operation of passenger services on lines fulfilling a public service obligation, Member States should be able to authorise the authorities responsible for those services to impose a levy on passenger services which fall within the jurisdiction of those authorities. That levy should contribute to the financing of public service obligations laid down in public service contracts awarded in conformity with Community law. It should be imposed in accordance with Community law, and in particular with the principles of fairness, transparency, non-discrimination and proportionality.

(14)

The regulatory body should function in a way which avoids any conflict of interests and any possible involvement in the award of the public service contract under consideration. In particular, if for organisational or legal purposes it is closely linked to the competent authority involved in the award of the public service contract under consideration, its functional independence should be ensured. The competence of the regulatory body should be extended to allow the assessment of the purpose of an international service and, where appropriate, the potential economic impact on existing public service contracts.

(15)

This Directive constitutes a further phase of the opening of the rail market. Some Member States have already opened up the market for international passenger services on their territory. In this context, this Directive should not be understood as creating obligations for those Member States to grant, before 1 January 2010, access rights to railway undertakings licensed in a Member State where similar rights are not granted.

(16)

In order to encourage investment for services using specialised infrastructure, such as high-speed railway lines, applicants need to be able to plan and require legal certainty reflecting the substantial long-term investment involved. It should therefore be possible for those undertakings normally to conclude framework agreements with a term of up to 15 years.

(17)

The national regulatory bodies should, on the basis of Article 31 of Directive 2001/14/EC, exchange information and, where relevant in individual cases, coordinate the principles and practice of assessing whether the economic equilibrium of a public service contract is compromised. They should progressively develop guidelines based on their experience.

(18)

The application of this Directive should be evaluated on the basis of a report to be presented by the Commission two years after the date of opening up the market in international passenger services. This report should also assess the development of the market, including the state of the preparation of a further opening-up of the passenger rail market. In this report the Commission should also analyse the different models for organising this market and the impact of this Directive on public service contracts and their financing. In so doing, the Commission should take into account the implementation of Regulation (EC) No 1370/2007 and the intrinsic differences between Member States (density of networks, number of passengers, average travel distance). In its report the Commission should, if appropriate, propose complementary measures to facilitate any such opening, and should assess the impact of any such measures.

(19)

The measures necessary for the implementation of Directives 91/440/EEC and 2001/14/EC should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission (11).

(20)

In particular, the Commission should be empowered to adapt the Annexes to those Directives. Since those measures are of general scope and are designed to amend non-essential elements of those Directives, they must be adopted in accordance with the regulatory procedure with scrutiny provided for in Article 5a of Decision 1999/468/EC.

(21)

A Member State which has no railway system, and no immediate prospect of having one, would be under a disproportionate and pointless obligation if it had to transpose and implement Directives 91/440/EEC and 2001/14/EC. Therefore, such Member States should be exempted, for as long as they have no railway system, from the obligation to transpose and implement these Directives.

(22)

Since the objective of this Directive, namely the development of the Community’s railways, cannot be sufficiently achieved by the Member States, given the need to ensure fair and non-discriminatory conditions of access to infrastructure and to take account of the obviously international dimension of the way in which important parts of the rail networks operate, as well as the need for coordinated transnational action, and can therefore be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve that objective.

(23)

In accordance with point 34 of the Interinstitutional Agreement on better law-making (12), Member States are encouraged to draw up, for themselves and in the interests of the Community, their own tables illustrating, as far as possible, the correlation between this Directive and the transposition measures, and to make them public.

(24)

Directives 91/440/EEC and 2001/14/EC should therefore be amended accordingly,

1.

the following paragraph shall be added to Article 2:

2.

the fourth indent of Article 3 shall be deleted;

3.

the following indent shall be inserted in Article 3 after the fifth indent:

4.

the following indent shall be inserted in Article 3 after the sixth indent:

5.

the first indent of Article 5(3) shall be deleted;

6.

the phrase ‘and international groupings’ shall be deleted in Article 8(1);

7.

Article 10(1) shall be deleted;

8.

the following paragraphs shall be inserted in Article 10:

9.

Article 10(8) shall be replaced by the following:

10.

the following paragraph shall be added to Article 10:

(*1)   OJ L 315, 3.12.2007, p. 1.’ "

11.

Article 11(2) shall be replaced by the following:

12.

Article 11a(3) shall be replaced by the following:

13.

the following subparagraph shall be added to Article 15:

‘The obligations for transposition and implementation of this Directive shall not apply to Cyprus and Malta for as long as no railway system is established within their territory.’

1.

the following point shall be added to Article 1(3):

2.

the following point shall be added to Article 2:

3.

the following paragraph shall be added to Article 13:

4.

Article 17(5) shall be replaced by the following:

5.

the following sentence shall be inserted before the final sentence of Article 30(1):

‘It shall furthermore be functionally independent from any competent authority involved in the award of a public service contract.’;

6.

Article 34(3) shall be replaced by the following:

7.

Article 35(3) shall be replaced by the following:

8.

the following subparagraph shall be added to Article 38:

‘The obligations for transposition and implementation of this Directive shall not apply to Cyprus and Malta for as long as no railway system is established within their territory.’

(1)

Directive 2004/49/EC (4) of the European Parliament and of the Council of 29 April 2004 on safety on the Community’s railways requires infrastructure managers and railway undertakings to establish their safety management systems in such a way that the railway system is at least able to achieve the common safety targets and comply with the national safety rules and safety requirements defined in the technical specifications for interoperability (TSIs) and that the relevant parts of the common safety methods are applied. These safety management systems provide, among other things, for staff training programmes and systems which ensure that staff competence is maintained and that duties are performed in the appropriate manner.

(2)

Directive 2004/49/EC provides that, in order to gain access to railway infrastructure, a railway undertaking has to hold a safety certificate.

(3)

Under Council Directive 91/440/EEC of 29 July 1991 on the development of the Community’s railways (5), licensed railway undertakings have had, since 15 March 2003, a right of access to the trans-European freight network for international rail freight services and , from 2007 at the latest, will have a right of access to the entire network for domestic and international freight services. This gradual extension of access rights will inevitably lead to an increase in the movement of train drivers across national borders. The result will be a growing demand for drivers trained and certified for operation in more than one Member State.

(4)

A study carried out by the Commission in 2002 highlighted the fact that the laws of the Member States on the certification conditions for train drivers differ considerably. Community rules for the certification of train drivers should therefore be adopted to overcome these differences while maintaining the present high level of safety of the railway system in the Community.

(5)

Such Community rules should also contribute to the aims of Community policies on the freedom of movement of workers, freedom of establishment and freedom to provide services in the context of the common transport policy, while avoiding any distortion of competition.

(6)

The aim of these common provisions should be above all to make it easier for train drivers to move from one Member State to another, but also to make it easier for them to move from one railway undertaking to another, and generally for licences and harmonised complementary certificates to be recognised by all railway sector stakeholders. To this end, it is essential that the provisions establish minimum requirements which applicants should meet to obtain a licence or harmonised complementary certificate.

(7)

This Directive follows and is largely based on the historic joint Agreement concluded by the European Transport Workers’ Federation (ETF) and the Community of European Railways (CER) on certain aspects of the working conditions of mobile workers engaged in interoperable cross-border services (6).

(8)

Even if a Member State excludes from the scope of this Directive drivers exclusively operating on certain categories of rail systems, networks and infrastructure, this should not limit in any way the obligation of that Member State to respect the validity of licences throughout the territory of the European Union or of harmonised complementary certificates on the relevant infrastructure.

(9)

The requirements should cover at least the minimum age for driving a train, the applicant’s physical and occupational psychological fitness, professional experience and knowledge of certain matters relating to driving a train, as well as a knowledge of the infrastructures on which he will be required to operate and of the language used on them.

(10)

In order to increase its cost-effectiveness, the training which train drivers should undergo in order to obtain a harmonised complementary certificate should be focused, to the extent that such is possible and desirable from a safety viewpoint, on the particular services to be performed by the driver, such as, for example, shunting, maintenance services, passenger or freight services. When assessing the implementation of this Directive, the European Railway Agency (hereinafter referred to as ‘the Agency’) should evaluate the need for amending the training requirements specified in the Annex in order better to reflect the new, emerging structure of the market.

(11)

Railway undertakings and infrastructure managers issuing harmonised complementary certificates may themselves provide training for general professional knowledge, linguistic knowledge, knowledge of rolling stock and infrastructures. However, with regard to examinations, any conflict of interests should be avoided, without excluding the possibility that an examiner may belong to the railway undertaking or infrastructure manager issuing the harmonised complementary certificate.

(12)

In accordance with Article 13(4) of Directive 2004/49/EC, railway undertakings and infrastructure managers are responsible for the level of training of the drivers they employ. To this end, railway undertakings and infrastructure managers should take into account the training and competences acquired previously by those drivers, in accordance with Article 13(3) of that Directive. It is also important to ensure that a sufficient number of drivers is trained. In this context, it is necessary, however, to take measures to ensure that investments made by a railway undertaking or an infrastructure manager for the training of a driver do not unduly benefit another railway undertaking or infrastructure manager in the case where that driver voluntarily leaves the former for the latter railway undertaking or infrastructure manager. These measures can be of any kind, such as for example national legislation, collective labour agreements, contractual clauses between driver and employer, or agreements determining the rehire of drivers belonging to one undertaking by another in the case where drivers are party to such agreements.

(13)

Staff competences and health and safety conditions are being developed in the context of the interoperability directives, in particular as part of the ‘traffic management and operation’ TSIs. There is a need to ensure coherence between these TSIs and the Annexes to this Directive. The Commission will achieve this by modifying or adapting the relevant TSI to this Directive and its Annexes using the procedures provided for in Council Directive 96/48/EC of 23 July 1996 on the interoperability of the trans-European high-speed rail system (7) and Directive 2001/16/EC of the European Parliament and of the Council of 19 March 2001 on the interoperability of the conventional rail system (8).

(14)

In order to increase the freedom of movement of workers and safety on Community railways, special attention should be paid to other crew members performing safety-critical tasks on locomotives and trains. Therefore Member States should ensure that other crew members performing safety-critical tasks meet the minimum requirements set out in the TSI on operation and traffic management. Taking account of the national implementation plans to be notified by the Member States in relation to the implementation of that TSI, the Agency should identify possible options for the certification of other crew members performing safety-critical tasks and assess the impact of these different options. On the basis of this report, the Commission should, if appropriate, present a proposal with regard to the conditions and procedures for the certification of other crew members performing safety-critical tasks on locomotives and trains.

(15)

The requirements pertaining to licences and harmonised complementary certificates set out in this Directive should relate solely to the legal conditions entitling a driver to drive a train. All other legal requirements, compatible with Community legislation and applied in a non discriminatory manner, pertaining to railway undertakings, infrastructure managers, infrastructure and rolling stock should equally be complied with before a driver may drive a train on a specific infrastructure.

(16)

This Directive should be without prejudice to the implementation of Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data (9), and of Regulation (EC) No 45/2001 of the European Parliament and of the Council of 18 December 2000 on the protection of individuals with regard to the processing of personal data by the Community institutions and bodies and on the free movement of such data (10).

(17)

In order to guarantee the necessary uniformity and transparency, the Community should establish a single certification model, mutually recognised by the Member States, attesting both to train drivers’compliance with certain minimum conditions, and to their professional qualifications and linguistic knowledge, leaving it to the competent authorities in the Member States to issue licences and to railway undertakings and infrastructure managers to issue harmonised complementary certificates.

(18)

The Agency should also examine the use of a smartcard instead of a licence and harmonised complementary certificates. Such a smartcard would have the advantage of combining these two items in one and at the same time could be used for other applications either in the area of security or for driver management purposes.

(19)

All of the information contained in licences, harmonised complementary certificates and the registers of licenses and harmonised complementary certificates should be used by the safety authorities to facilitate evaluation of the staff certification process provided for in Articles 10 and 11 of Directive 2004/49/EC and to speed up the issuing of the safety certificates provided for in those Articles.

(20)

The employment of train drivers certified in accordance with this Directive should not exonerate railway undertakings and infrastructure managers from their obligation to set up a system of monitoring and internal control of the competence and conduct of their train drivers pursuant to Article 9 of and Annex III to Directive 2004/49/EC and should form part of that system. The harmonised complementary certificate should not relieve either railway undertakings or infrastructure managers of their responsibility for safety and, in particular, the training of their staff.

(21)

Certain companies provide the services of train drivers to railway undertakings and infrastructure managers. In such cases, responsibility for ensuring that a driver is licensed and certified in accordance with this Directive should lie with the railway undertaking or infrastructure manager contracting the driver.

(22)

For rail transport to continue to operate effectively, train drivers already working in that profession before the entry into force of this Directive should retain their acquired entitlements during a transition period.

(23)

Unnecessary administrative and financial burdens should be avoided when replacing authorisations to drive issued to drivers before the application of the relevant provisions of this Directive with harmonised complementary certificates and licences which are in conformity with this Directive. Therefore, entitlements to drive previously granted to a driver should be safeguarded, as far as possible. The qualifications and experience of each driver, or group of drivers, should be taken into account by the issuing bodies when authorisations are to be replaced. The issuing body should decide, on the basis of qualifications and/or experience, whether it is necessary for a driver or a group of drivers to undergo any additional examination and/or training before they can receive replacement licences and harmonised complementary certificates. Therefore, it should be a matter for the issuing body to decide whether qualifications and/or experience suffice to issue the required licences and harmonised complementary certificates, without there being any need for further examination or training.

(24)

Unnecessary administrative and financial burdens should also be avoided when train drivers change employer. A railway undertaking employing a driver should take into account competences acquired earlier and should dispense with additional examinations and training as far as possible.

(25)

This Directive should not confer any mutual recognition rights relating to entitlements to drive which drivers have obtained before the application of this Directive, albeit without prejudice to the general mutual recognition scheme set up under Directive 2005/36/EC of the European Parliament and of the Council of 7 September 2005 on the recognition of professional qualifications (11), which shall continue to apply until the end of the transition period.

(26)

The measures necessary for the implementation of this Directive should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission (12).

(27)

In particular, the Commission should be empowered to establish the conditions and criteria necessary for the implementation of this Directive. Since those measures are of general scope and are designed to amend non-essential elements of this Directive, or to supplement it with new non-essential elements, they must be adopted in accordance with the regulatory procedure with scrutiny provided for in Article 5a of Decision 1999/468/EC.

(28)

When, on imperative grounds of urgency, the normal time-limits for the regulatory procedure with scrutiny cannot be complied with, the Commission should be able to have recourse to the urgency procedure provided for in Article 5a(6) of Decision 1999/468/EC for the adoption of Community criteria for the choice of examiners and examinations as provided for by this Directive, and for the adaptation to scientific and technical progress of the Annexes to this Directive, as provided for thereby.

(29)

In accordance with point 34 of the Interinstitutional Agreement on better law-making (13), Member States are encouraged to draw up, for themselves and in the interests of the Community, their own tables illustrating, as far as possible, the correlation between this Directive and the transposition measures, and to make them public.

(30)

Member States should provide for controls regarding compliance with this Directive and appropriate action where a driver infringes any provision of this Directive.

(31)

Member States should provide for appropriate penalties for infringements of national provisions implementing this Directive.

(32)

Since the objective of this Directive, namely the laying down of a common regulatory framework for the certification of train drivers operating locomotives and trains for the carriage of passengers and goods, cannot be sufficiently achieved by the Member States, and can therefore, by reason of the scale and effects of this Directive, be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve that objective.

(33)

It might prove appropriate, for reasons of cost-effectiveness, to exempt for a limited period of time train drivers operating exclusively on the territory of one Member State from application of the provisions of this Directive pertaining to the obligation for such drivers to hold licences and harmonised complementary certificates in conformity with this Directive. The conditions governing any such exemptions should be clearly defined.

(34)

A Member State which has no railway system, and no immediate prospect of having one, would be under a disproportionate and pointless obligation if it had to transpose and implement this Directive. Therefore, such Member States should be exempted, for as long as they have no railway system, from the obligation to transpose and implement this Directive,