COMMON POSITION (EC) No 43/94 adopted by the Council on 21 November 1994 with a view to adopting a Council Directive 94/. . ./EC, of . . ., on the licensing of railway undertakings (94/C 354/02)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 75 thereof,

Having regard to the proposal from the Commission (1),

Having regard to the opinion of the Economic and Social Committee (2),

Acting in accordance with the procedure laid down in Article 189c of the Treaty (3),

Whereas the single market shall comprise an area without internal frontiers in which the free movement of goods, persons, services and capital is ensured;

Whereas the principle of the freedom to provide services should be applied to the railway sector, taking into account that sector's specific characteristics;

Whereas Council Directive 91/440/EEC of 29 July 1991 on the development of the Community's railways (4) provides for certain access rights in international rail transport for railway undertakings and international groupings of railway undertakings;

Whereas, in order to ensure that access rights to railway infrastructure are applied throughout the Community on a uniform and non-discriminatory basis, it is appropriate to introduce a licence for railway undertakings providing the services referred to in Article 10 of Directive 91/440/EEC;

Whereas it is appropriate to maintain the scope of Directive 91/440/EEC, including the exceptions made in it for regional, urban and suburban services and whereas it should be specified that transport activities in the form of shuttle services through the Channel Tunnel are also excluded from the scope of that Directive;

Whereas a licence issued by a Member State should accordingly be recognized as valid throughout the Community;

Whereas Community conditions for access to or transit via railway infrastructure will be regulated by other provisions of Community law;

Whereas, having regard to the principle of subsidiarity and in order to ensure the requisite uniformity and transparency, it is appropriate that the Community lay down the broad principles of such a licensing system, leaving to Member States the responsibility for the granting and the administration of licences;

Whereas, in order to ensure dependable and adequate services, it is necessary to ensure that railway undertakings meet at any time certain requirements in relation to good repute, financial fitness and professional competence;

Whereas for the protection of customers and third parties concerned it is important to ensure that railway undertakings are sufficiently insured or have made equivalent arrangements in respect of liability risks;

Whereas the suspension and revocation of licences and the granting of temporary licences should also be dealt with in this context;

Whereas a railway undertaking will also be required to comply with national and Community rules on the provision of railway services, applied in a non-discriminatory manner, which are intended to ensure that it can carry on its activity in complete safety on specific stretches of track;

Whereas, in order to ensure the efficient operation of international rail transport, it is necessary that railway undertakings respect the agreements in force in this field;

Whereas, finally, the procedures for the granting, maintenance and amendment of operating licences to railway undertakings should reflect a general desire for transparency and non-discrimination,

HAS ADOPTED THIS DIRECTIVE:

SECTION I Objective and scope

Article 1

1. This Directive concerns the criteria applicable to the issue, renewal or amendment of licences by a Member State intended for railway undertakings which are or will be established in the Community when they provide the services referred to in Article 10 of Directive 91/440/EEC under the conditions laid down in that Article.

2. Railway undertakings the activities of which are limited to the operation of urban, suburban or regional services shall be excluded from the scope of this Directive.

Railway undertakings and international groupings the activity of which is limited to the provision of shuttle services transporting road vehicles through the Channel Tunnel shall also be excluded from the scope of this Directive.

3. A licence shall be valid throughout the territory of the Community.

Article 2

For the purposes of this Directive:

(a) 'railway undertaking' shall mean any private or public undertaking the main business of which is to provide rail transport services for goods and/or passengers, with a requirement that the undertaking must ensure traction;

(b) 'licence' shall mean an authorization issued by a Member State to an undertaking, by which its capacity as a railway undertaking is recognized. That capacity may be limited to the provision of specific types of services;

(c) 'business plan' shall mean a detailed description of a railway undertaking's intended commercial activities for the period covered, in particular in relation to market developments and investment, including the financial and economic implications of those activities;

(d) 'licensing authority' shall mean the body charged by a Member State with the issue of licences.

Article 3

Each Member State shall designate the body responsible for issuing licences and for carrying out the obligations imposed by this Directive.

SECTION II Licences

Article 4

1. A railway undertaking shall be entitled to apply for a licence in the Member State in which it is established.

2. Member States shall not issue licences or extend their validity where the requirements of this Directive are not complied with.

3. A railway undertaking which fulfils the requirements imposed in this Directive shall be authorized to receive a licence.

4. No railway undertaking shall be permitted to provide the rail transport services covered by this Directive unless it has been granted the appropriate licence for the services to be provided.

However, such a licence shall not itself entitle the holder to access to the railway infrastructure.

Article 5

1. A railway undertaking must be able to demonstrate to the licensing authorities of the Member State concerned before the start of its activities that it will at any time be able to meet the requirements relating to good repute, financial fitness, professional competence and cover for its civil liability listed in Articles 6 to 9.

2. For the purposes of paragraph 1, each applicant shall provide all relevant information.

Article 6

Member States shall define the conditions under which the requirement of good repute is met to ensure that an applicant railway undertaking or the persons in charge of its management:

- has/have not been convicted of serious criminal offences, including offences of a commercial nature,

- has/have not been declared bankrupt,

- has/have not been convicted of serious offences against specific legislation applicable to transport,

- has/have not been convicted of serious or repeated failure to fulfil social- or labour-law obligations, including obligations under occupational safety and health legislation.

Article 7

1. The requirements relating to financial fitness shall be met when an applicant railway undertaking can demonstrate that it will be able to meet its actual and potential obligations, established under realistic assumptions, for a period of 12 months.

2. For the purposes of paragraph 1, each applicant shall give at least the particulars listed in Section I of the Annex.

Article 8

1. The requirements relating to professional competence shall be met when:

(a) an applicant railway undertaking has or will have a management organization which possesses the knowledge and/or experience necessary to exercise satisfactory operational control and supervision of the type of operations specified in the licence;

(b) its personnel responsible for safety, in particular drivers, are suitably qualified for their field of activity; and

(c) its personnel, rolling stock and organization can ensure an appropriate level of safety for the services to be provided.

2. For the purposes of paragraph 1, each applicant shall give at least the particulars listed in Section II of the Annex.

3. Appropriate written proof of compliance with qualification requirements shall be produced.

Article 9

A railway undertaking shall be adequately insured or make equivalent arrangements for cover, in accordance with national and international law, of its liabilities in the event of accidents, in particular in respect of passengers, luggage, freight, mail and third parties.

SECTION III Validity of the licence

Article 10

1. A licence shall be valid as long as the railway undertaking fulfils the obligations laid down in this Directive. A licensing authority may, however, make provision for a regular review at least every five years.

2. Specific provisions governing the suspension or revocation of a licence may be incorporated in the licence itself.

Article 11

1. If there is serious doubt that a railway undertaking which it has licensed complies with the requirements of this Directive, and in particular Article 5 thereof, the licensing authority may, at any time, check whether that railway undertaking does in fact comply with those requirements.

Where a licensing authority is satisfied that a railway undertaking can no longer meet the requirements of the Directive, and in particular Article 5 thereof, it shall suspend or revoke the licence.

2. Where the licensing authority of a Member State is satisfied that there is serious doubt regarding compliance with the requirements laid down in this Directive on the part of a railway undertaking to which a licence has been issued by the licensing authority of another Member State, it shall inform the latter authority without delay.

3. Notwithstanding paragraph 1, where a licence is suspended or revoked on grounds of non-compliance with the requirement for financial fitness, the licensing authority may grant a temporary licence pending the reorganization of the railway undertaking, provided that safety is not jeopardized. A temporary licence shall not, however, be valid for more than six months after its date of issue.

4. When a railway undertaking has ceased operations for six months or has not started operations six months after the grant of a licence, the licensing authority may decide that the licence shall be resubmitted for approval or be suspended.

As regards the start of activities, the railway undertaking may ask for a longer period to be fixed, taking account of the specific nature of the services to be provided.

5. In the event of a change affecting the legal situation of an undertaking and, in particular, in the event of a merger or takeover, the licensing authority may decide that the licence shall be resubmitted for approval. The railway undertaking in question may continue operations, unless the licensing authority decides that safety is jeopardized; in that event, the grounds for such a decision shall be given.

6. Where a railway undertaking intends significantly to change or extend its activities, its licence shall be resubmitted to the licensing authority for review.

7. A licensing authority shall not permit a railway undertaking against which bankruptcy or similar proceedings are commenced to retain its licence if that authority is convinced that there is no realistic prospect of satisfactory financial restructuring within a reasonable period of time.

8. When a licensing authority suspends, revokes or amends a licence, the Member State concerned shall immediately inform the Community accordingly. The Commission shall inform the other Member States forthwith.

Article 12

In addition to the requirements of this Directive, a railway undertaking shall also comply with those provisions of national law which are compatible with Community law and are applied in a non-discriminatory manner, in particular:

- specific technical and operational requirements for rail services,

- safety requirements applying to staff, rolling stock and the internal organization of the undertaking,

- provisions on health, safety, social conditions and the rights of workers and consumers.

Article 13

Railway undertakings shall respect the agreements applicable to international rail transport in force in the Member States in which they operate.

SECTION IV Transitional provision

Article 14

Railway undertakings operating rail services shall be granted a transitional period of 12 months as at the final date of transposition referred to in Article 16 (2) in order to comply with the provisions of this Directive. That transitional period shall not cover any provision which might affect the safety of railway operations.

SECTION V Final provisions

Article 15

1. The procedures for the granting of licences shall be made public by the Member State concerned, which shall inform the Commission thereof.

2. The licensing authority shall take a decision on an application as soon as possible, but not more than three months after all relevant information, notably the particulars referred to in the Annex, has been submitted, taking into account all the available information. The decision shall be communicated to the applicant railway undertaking. A refusal shall state the grounds therefor.

3. Member States shall take the measures necessary to ensure that the licensing authority's decisions are subject to judicial review.

Article 16

1. The Commission shall, two years after the application of this Directive, submit to the Council a report on such application accompanied, if necessary, by proposals concerning continued Community action, with particular regard to the possibility of enlarging the scope of the Directive.

2. Member States shall adopt the laws, regulations and administrative provisions necessary to comply with this Directive within two years of the date of its entry into force. They shall forthwith inform the Commission thereof.

3. When Member States adopt those provisions, they shall contain a reference to this Directive or be accompanied by such reference at the time of their official publication. The methods of making such a reference shall be laid down by the Member States.

Article 17

This Directive shall enter into force on the date of its publication in the Official Journal of the European Communities.

Article 18

This Directive is addressed to the Member States.

Done at . . .

For the Council

The President

(1) OJ No C 24, 28. 1. 1994, p. 2 and OJ No C 225, 13. 8. 1994, p. 9.

(2) Opinion delivered on 14 September 1994 (not yet published in the Official Journal).

(3) Opinion of the European Parliament of 3 May 1994 (OJ No C 205, 25. 7. 1994, p. 38), Council common position of . . . (not yet published in the Official Journal) and Decision of the European Parliament of . . . (not yet published in the Official Journal).

(4) OJ No L 237, 24. 8. 1991, p. 25.

ANNEX

I. Particulars referred to in Article 7 (2)

1. Financial fitness will be verified by means of an undertaking's annual accounts or, in the case of applicant undertakings unable to present annual accounts, a balance sheet. Detailed particulars must be provided, in particular on the following aspects:

(a) available funds, including the bank balance, pledged overdraft provisions and loans;

(b) funds and assets available as security;

(c) working capital;

(d) relevant costs, including purchase costs or payments to account for vehicles, land, buildings, installations and rolling stock;

(e) charges on an undertaking's assets.

2. In particular, an applicant is not financially fit if considerable arrears of taxes or social security are owed as a result of the undertaking's activity.

3. The authority may in particular require the submission of an audit report and suitable documents from a bank, public savings bank, accountant or auditor. These documents must include information concerning the matters referred to in paragraph 1.

II. Particulars referred to in Article 8 (2)

1. Particulars of the nature and maintenance of rolling stock, in particular as regards safety standards.

2. Particulars of the qualifications of personnel responsible for safety and details of personnel training.

STATEMENT OF THE COUNCIL'S REASONS

I. Introduction

On 15 December 1993 the Commission submitted to the Council a proposal for a Directive, based on Article 75 of the EC Treaty, on the licensing of railway undertakings (1).

The European Parliament delivered its opinion on 3 May 1994 (2) and the Economic and Social Committee on 14 September 1994 (3).

In the light of those opinions, the Commission submitted an amended proposal to the Council on 18 July 1994 (4).

On . . . the Council adopted its common position in accordance with Article 189c of the EC Treaty.

II. Objective of the proposal

The purpose of the amended Commission, together with the proposal for a Directive on the allocation of railway infrastructure capacity and the charging of infrastructure fees, is to facilitate the application of Directive 91/440/EEC on the development of the Community's railways (5). The proposal provides for the introduction of a licence for railway undertakings in order to ensure the application of common conditions for access to the Community railway market, under the rights of access to railway infrastructure granted by Article 10 of Directive 91/440/EEC.

Possession of the licence, valid throughout the Community, guarantees that an undertaking is able to provide rail services both safely and efficiently. The licence does not in itself entitle an undertaking to operate any transport services but its possession allows an undertaking to apply for rights of access to the infrastructure in question.

It should be noted that Directive 91/440/EEC grants:

- rights of access to infrastructure in other Member States for railway undertakings, in the private or public sector, established or to be established in a Member State, when operating international combined transport goods services,

- access and transit rights in the Member States of establishment of their constituent railway undertakings for international groupings, as well as transit rights in other Member States for international services between the Member States where the undertakings constituting such groupings are established.

III. Analysis of the common position

The Council's common position to a very large extent follows the objectives of the Commission proposal, but it incorporates a number of amendments to that proposal.

The main amendments made by the Council concern the following areas:

1. Scope of the Directive

Under the Commission proposal, a licence would have been required for all railway undertakings, even those operating only domestic services, with Member States having the option of not requiring licences for railway undertakings whose activities are confined to urban, suburban and regional services only.

The common position, however, provides for the introduction of a licence solely for the railway undertakings and international groupings referred to in Article 10 of Directive 91/440/EEC in respect of provision of the services referred to in that Article (Article 1 (1)).

Railway undertakings whose activities are confined to urban, suburban and regional services are excluded from the scope of the Directive, as from that of Directive 91/440/EEC; shuttle services operated through the Channel Tunnel are also excluded from the scope of the Directive (Article 1 (2)).

Given the very recent implementation by Member States of Directive 91/440/EEC, the Council thought that it was advisable to keep to the principles governing the adoption of Directive 91/440/EEC and that the Directive on licensing and the one on the allocation of infrastructure capacity should represent two measures strictly in implementation of Directive 91/440/EEC so as to form a complement to it without going beyond its scope. However, an exception to the scope of Directive 91/440/EEC was made for shuttle services through the Channel Tunnel in view of the special nature of such services.

2. Conditions to be fulfilled in order to obtain a licence

Under the Commission proposal, in order to obtain a licence, all undertakings coming within the Directive's scope would have had to fulfil conditions regarding good repute, financial fitness and professional competence and be insured in accordance with the Directive's requirements.

The Council thought that the requirements laid down by the proposal were too restrictive, particularly those regarding financial fitness, and that general requirements should be set, leaving Member States to introduce detailed requirements (Articles 7 and 8 of the common position and Sections I and II of the Annex (new)).

3. Report on application and possible further Community action

The common position stipulates that the Commission is to submit to the Council, two years after the Directive's implementation, a report on its application accompanied, if necessary, by proposals concerning continued Community action for the development of railways with particular regard to the possibility of enlarging the scope of the Directive (Article 16 (1)).

4. Time limit for implementing the Directive

In view of its complexity, the Directive is to be implemented within two years of its entry into force (Article 16 (2)).

IV. European Parliament amendments

1. European Parliament amendments accepted by the Council

The Council followed the amended Commission proposal in accepting amendment 4 (Article 5 (2) of the common position), amendment 5, first and second parts (Article 7), amendment 15 (Article 12) and amendment 19 (new Annex, heading of Section I).

The common position also incorporates, in Article 1 (3), the first part of amendment 3, and, in Article 11 (3), amendment 12. Lastly, Article 4 of the common position is consistent with the second part of amendment 3. The Council felt that the safety certificate and train paths should be dealt with not in a Directive concerned only with the licensing of railway undertakings but rather in the Directive on the allocation of infrastructure capacity.

2. European Parliament amendments not accepted by the Council

(a) Included by the Commission

The Council considered that in general terms amendments 23 (in view of the scope laid down in the common position), 1, 22, 8 and 14 were covered by the common position.

As regards the last part of amendment 5, and amendments 6, 9, 13, 21 and 20, concerning the requirements to be met by undertakings regarding financial fitness and professional competence (see also III.2), the Council felt that, in order to ensure reliable services of a suitable kind, it was sufficient for the Community to lay down the general principles for the system, leaving Member States latitude to exploit the scope offered by the agreements provided for in Article 10 of Directive 91/440/EEC and to determine the evidence to be provided (last paragraph of amendment 5).

As regards amendments 10, 11, 16 and 17, the Council thought that Member States should be left to spell out in further detail certain conditions regarding licence validity, relevant possibilities for existing railway undertakings and licence issuing procedures.

As regards amendment 18, see III.4.

(b) Not included by the Commission

The Council did not accept amendment 7 (see Article 8 (2) of the Commission proposal), taking the view that Member States should be left to regulate access to training services.

(1) OJ No C 24, 28. 1. 1994, p. 2.

(2) 6738/94 PE-RESOL 33, p. 2.

(3) CES 1005/94.

(4) OJ No C 225, 13. 8. 1994, p. 9.

(5) OJ No L 237, 24. 8. 1991, p. 25.