# EUR-Lex - 52012PC0119 - EN

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# 52012PC0119

**COMMUNICATION FROM THE COMMISSIONTO THE EUROPEAN PARLIAMENTpursuant to Article 294(6) of the Treaty on the Functioning of the European Unionconcerning the position of the Council (1st reading) on the adoption of a Directive of the European Parliament and of the Council establishing a single European railway area (Recast) /* COM/2012/0119 final - 2010/0253 (COD) */**

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2010/0253 (COD)

COMMUNICATION FROM THE COMMISSION
TO THE EUROPEAN PARLIAMENT
pursuant to Article 294(6) of the Treaty on the Functioning of the European
Union
concerning the

position of the Council (1st reading) on
the adoption of a Directive of the European Parliament and of the Council
establishing a single European railway area (Recast)

1.           Background

Date of transmission of the proposal to the European Parliament and to the Council (document COM(2010) 475 final – 2010/0253(COD): || 21/09/2010

Date of the opinion of the European Committee of Regions: || 28/01/2011

Date of the opinion of the European Economic and Social Committee: || 16/03/2011

Date of the position of the European Parliament, first reading: || 16/11/2011

Date of adoption of the Council's political agreement in view of a Council’s position at first reading: || 12/12/2011

Date of adoption of the Council's position at first reading: || 08/03/2012

2.           Objective
of the proposal from the Commission

Infringement procedures, complaints
received from stakeholders as well as different studies and reports on the implementation of the first railway package, have demonstrated that there was an opportunity to improve the
current regulatory framework.

In this context, beyond simplification and
increasing transparency, the Commission proposal to recast the first railway package aims to address (a)
the adequate financing of and charging for rail infrastructures, (b) the
conditions of competition on the railway market, and (c) the organisational
reforms needed to ensure appropriate supervision of the market:

(a)          Ensuring adequate, transparent
and sustainable funding of the infrastructure and, thanks to better
predictability of the infrastructure development and access conditions,
facilitating investments by railway undertakings, together with a more
appropriate level and structure of infrastructure charging, improving the
competitiveness of rail operators vis-à-vis other transport modes and
contributing to the internalisation of environmental costs constitute the first
objective of the proposed recast.

(b)          Avoiding distortions of
competition due to the use of State funds for commercial activities, preventing
commercially sensitive information from being collected by incumbents and used
against their potential competitors, eliminating conflicts of interest in the
management of rail-related services and increasing their availability for new
entrants as well as increasing market transparency to ensure effective
competition are a second set of objectives.

(c)          Regarding regulatory oversight,
the proposed recast intends to ensure that regulatory bodies are in a position
to carry out their duties effectively, thanks to reinforced independence,
extended competencies, and additional means at their disposal.

3.           Comments
on the position of the Council

3.1       General comments on the
position of the Council

The Council reached a political agreement
on 12 December 2011 and a position in first reading on 8 March 2012 by
qualified majority. While still being in line with the general objective of
simplification and increasing transparency by consolidating three existing
directives and their modifications, the Council weakened the Commission
proposal concerning access to rail-related services, infrastructure financing,
infrastructure charges and powers of the regulatory body. In some cases, the
Council's position confirms existing law without further improvement despite
the various reasons for such efforts listed above in section 2. In this regard,
the Council's position would be improved by taking into account some amendments
adopted by the European Parliament.

3.2       Detailed Commission comments

The detailed comments are presented
according to the main fields of activity covered by the draft directive.

3.2.1    General
provisions (articles 1 to 3)

The Council's changes
mostly aim at further clarification and simplification of existing provisions
and are therefore acceptable for the Commission.

3.2.2    Management
independence; separation of infrastructure managers and transport operators
(articles 4 to 7)

Once again, the
Council's changes mostly aim at further clarification and simplification of
existing provisions. The Commission can therefore accept these improvements.

3.2.3 Improvement of
the financial situation of infrastructure managers and railway undertakings
(articles 8 and 9)

The Council links the
requirement of balancing the accounts of the infrastructure manager to the
contractual agreement between the competent authority and the infrastructure
manager which may cover a longer period and is therefore provides a poorer
basis for ensuring effective long term planning and implementation of infrastructure
investment than the Commission proposal.

3.2.4    Access to
railway infrastructure and services (articles 10 to 13)

Most changes introduced
by the Council are in line with the general objective of the Commission
proposal. However, the Commission finds it regrettable that the requirement of
a legal separation between railway undertakings holding a dominant position and
operators of service facilities is reduced to independence in organisational
and decision-making terms and to an obligation to have separate accounts. This
will make it more difficult in practice to ensure full transparency and equal
treatment between rail undertakings.

The reversed burden of
proof in relation to the existence of viable alternatives is weakened.

Finally, the obligation
to make available a service facility which is not in use, on a rent or lease
basis, to another interested party is retained in the Council's position but in
case of an explicit interest by railway undertakings for access to this
facility on the basis of demonstrated needs and after an extended non-use
period to 3 years instead of 2 years in the Commission proposal.

3.2.5    Cross-border
agreements (article 14)

The Council's position
detailing further the process to be followed to ensure compliance of
cross-border agreements with EU law is acceptable for the Commission.

3.2.6    Monitoring
tasks of the Commission (article 15)

The Council's changes
specifying those tasks are acceptable for the Commission.

3.2.7    Licensing
of railway undertakings (articles 16 to 25)

The Council has
introduced a small number of changes to the Commission proposal that aim at the
clarification of existing provisions and are acceptable for the Commission.

3.2.8    Infrastructure
charges and allocation of infrastructure capacity (article 26 to 54)

Most changes introduced
by Council aim at the clarification of existing provisions and are therefore
acceptable for the Commission.

However the Commission
regrets that the Council weakened its proposal by making only optional differentiation
of charges on the basis of noise performance or the use of ERTMS as well as the
introduction of reservation charges.

The Council reduced the
minimum time period of the contractual agreement between the competent
authority and the infrastructure manager for infrastructure planning and
financing to 3 years; the Commission strongly believes its initial proposal of
5 years represented a good compromise, and (as with Art 3.2.3) the Council
position will undermine long term investment.

Council included a
provision allowing for full cost recovery for freight transport from and to
third countries on a network whose track gauge is different from the main rail
network within the EU. The Commission believes that such an exemption cannot be
justified by such a purely technical as opposed to economic or operational
difference.

3.2.9    Regulatory
body (articles 55 to 57)

Most changes introduced
by the Council result in weakening the position of the regulatory body in
comparison with the initial proposal of the Commission. The Commission regrets
that the Council made purely optional the possibility for regulators to
intervene on financing issues (in particular in the adoption of infrastructure
business plans, contractual agreements with National authorities and congestion
plans). The Commission continues to believe that clearer requirements to
protect the independence of regulators' staff are justified.

3.2.10  Final
provisions (articles 58 to 67)

In some cases, the
Council restricted powers to the Commission to adopt delegated or implementing
acts but the outcome is still acceptable for the Commission. While the Commission regrets a restrictive approach in determining
the essential nature of specific annexes, the majority of changes would give to
the Commission further possibilities to ensure harmonised implementation of the
legislation and can therefore be considered acceptable.

The Council proposes 36
months for transposition. The Commission considers that a shorter deadline as
foreseen by Parliament would be preferable.

4.           Conclusion

The present proposal is particularly
important to reach the objectives set out in its communication "Roadmap to
a Single European Transport Area – Towards a competitive and resource efficient
transport system" adopted on 28 March 2011. It should also pave the way to
new Commission initiatives in 2012 to foster further market integration in rail
transport and should therefore be adopted by co-legislators as soon as
possible.

Despite the weakening
of several provisions, the Commission considers that the Council’s position
reflects the main objectives of its proposal and therefore believes that the
legislative process and the discussion with the European Parliament should
continue in second reading.