Fourth railway package still divides Member States

02-12-2014

The fourth railway package was proposed by the Commission in January 2013. This is the latest in a series of reforms over the past 15 years that have led to deep-seated changes in the rail sector aimed at improving the quality of services, cutting their cost and creating greater interoperability within the European railway area, while provoking a radical rethink of public monopolies in the rail sector. Spurred on by the EU, European railway companies have gradually opened up to competition. Freight transport has been fully liberalised since 2007 and passenger transport has been partially opened up (for international connections only) since 2010. With the fourth railway package, the Commission wants to take the process a step further. It proposes that, by December 2019, rail companies must be granted access to domestic passenger services in all EU Member States. In addition, it requires the functions of owning/operating the infrastructure to be separated from that of providing train services to customers, whether through institutional separation, or through a vertically integrated (holding) company, to ensure the necessary legal, financial and operational separation. Furthermore, public service contracts will no longer be excluded from competitive tendering. This obligation will be subject to a value threshold, however, below which there can be a direct award if the costs of tendering would exceed the expected savings in public funds. Lastly, the procedure for vehicle authorisation and certification, from now on to be done on EU-wide scale by the European Railway Agency (as 'a one stop shop'), would be simplified, cutting costs and shortening administrative deadlines. While the Council of the EU is far from a common vision on the proposal, the Parliament adopted its first-reading position in February 2014. However, the plenary did not follow the Transport mmittee, drawing criticism from various stakeholders. This briefing updates an earlier one of March 2013.

The fourth railway package was proposed by the Commission in January 2013. This is the latest in a series of reforms over the past 15 years that have led to deep-seated changes in the rail sector aimed at improving the quality of services, cutting their cost and creating greater interoperability within the European railway area, while provoking a radical rethink of public monopolies in the rail sector. Spurred on by the EU, European railway companies have gradually opened up to competition. Freight transport has been fully liberalised since 2007 and passenger transport has been partially opened up (for international connections only) since 2010. With the fourth railway package, the Commission wants to take the process a step further. It proposes that, by December 2019, rail companies must be granted access to domestic passenger services in all EU Member States. In addition, it requires the functions of owning/operating the infrastructure to be separated from that of providing train services to customers, whether through institutional separation, or through a vertically integrated (holding) company, to ensure the necessary legal, financial and operational separation. Furthermore, public service contracts will no longer be excluded from competitive tendering. This obligation will be subject to a value threshold, however, below which there can be a direct award if the costs of tendering would exceed the expected savings in public funds. Lastly, the procedure for vehicle authorisation and certification, from now on to be done on EU-wide scale by the European Railway Agency (as 'a one stop shop'), would be simplified, cutting costs and shortening administrative deadlines. While the Council of the EU is far from a common vision on the proposal, the Parliament adopted its first-reading position in February 2014. However, the plenary did not follow the Transport mmittee, drawing criticism from various stakeholders. This briefing updates an earlier one of March 2013.