No C 34/8 Official Journal of the European Communities 14. 2. 90 
II 
(Preparatory Acts) 
COMMISSION 
Proposal for a Council Directive on the development of the Community railways 
COM(89) 564 final 
(Submitted by the Commission on 1 December 1989) 
(90/C 34/06) 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 75 
thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European 
Parliament, 
Having regard to the opinion of the Economic and 
Social Committee, 
Whereas the greater integration of the European 
transport sector is an essential element of the internal 
market; whereas the railways are a vital part of the 
Community transport sector; 
Whereas the efficiency of the railway system in the 
internal market and on transit routes should be improved 
within a competitive market whilst taking account of the 
special characteristics of the railways; 
Whereas to achieve these objectives the appropriate 
measures to remove restrictions of the freedom to 
provide services are required to be taken in the light of 
practical experience; 
Whereas the future development and efficient operation 
of the railway system requires that a distinction be made 
between the provision of railway transport services and 
the operation of infrastructure; whereas to make this 
distinction effective, it is necessary that in all cases these 
two activities are separately managed and have distinct 
accounts; 
Whereas for reasons of transparency each Member State 
should lay down and make public the conditions for the 
maintenance and establishment in its territory of railway 
undertakings and rules on their access rights to its 
national infrastructure; Whereas, in order to facilitate transport between 
Member States, railway undertakings should be free to 
form groupings with railway undertakings established in 
other Member States; 
Whereas, such international groupings should be granted 
rights of access and transit in the Member States of 
establishment of their constituent undertakings, as well 
as transit rights in other Member States as required for 
the international service concerned; 
Whereas, in the absence of common rules on allocation 
of infrastructure costs and in order to provide for equal 
treatment between modes of transport, Member States 
shall lay down and make public rules providing for the 
payment by railway undertakings and their international 
groupings for the use of railway infrastructure; whereas 
such rules must be based on the principles of 
non-discrimination and fair competition between modes 
of transport; 
Whereas Member States should compensate infra­
structure operators for losses incurred, if and as far as 
the latter are required to charge transport undertakings 
below cost price; 
Whereas, in order to render railway transport services 
efficient and competitive with regard to other modes of 
transport, Member States should ensure that railway 
undertakings are given a status of independent operators 
behaving in a commercial manner; 
Whereas, to the same end, Member States should ensure 
in particular that State-owned railway transport under­
takings are given a sound financial structure whilst any 
financial rearrangement as may be necessary shall be 
made in accordance with the relevant rules laid down in 
the Treaty; 
Whereas it is necessary to establish an advisory 
committee to monitor and assist the Commission with 
the implementation of this Directive, 
14. 2. 90 Official Journal of the European Communities No C 34/9 
HAS ADOPTED THIS DIRECTIVE: Article 3 
SECTION I 
Objective and scope 
Article 1 
The objective of this Directive is to facilitate the devel­
opment in the Community of efficient railways designed 
to meet the needs of a single market. 
Article 2 
1. For the purpose of this Directive: 
(a) 'railway undertakings' means undertakings estab­
lished in the Community to provide general railway 
transport services, and in particular the following 
companies: 
— Societe nationale des chemins de fer beiges 
(SNCB) / Nationale Maatschappij der Belgische 
Spoorwegen (NMBS), 
— Danske Statsbaner (DSB), 
— Deutsche Bundesbahn (DB), 
— Opyavuruoc, Li8n,po8p6|ia>v EAX&8o$ (OIE), 
— Red Nacional de los Ferrocarriles Espafioles 
(RENFE), 
— Societe nationale des chemins de fer francais 
(SNCF), 
— Iarnrod Eireann (IE), 
— Ente Ferrovie dello Stato (FS), 
— Societe nationale des chemins de fer luxem-
bourgeois (CFL), 
— Naamloze Vennootschap Nederlandse 
Spoorwegen (NS), 
— Caminhos do Ferro Portugueses EP (CP), 
— British Rail (BR), 
— Northern Ireland Railways (NIR); 
(b) 'international grouping' means a grouping of railway 
undertakings, including at least two undertakings 
established in different Member States, created to 
operate services between them; 
(c) 'infrastructure operator' means any public body or 
undertaking operating railway infrastructure. 
2. Railway undertakings whose activity is limited to 
the provision of urban and suburban services — as 
defined by Article 1 (5) of Council Regulation (EEC) 
No 1191/69 (*) — are exempted from the scope of this 
Directive. Member States shall lay down the financial and other 
requirements, including the procedure for authorization, 
that any undertaking has to meet for establishment as a 
railway undertaking having access to the national infra­
structure. 
SECTION II 
Railway infrastructure 
Article 4 
Member States shall take the necessary measures to 
provide for the development of national railway infra­
structures taking into account the general needs of the 
Community. To this end they shall lay down and make 
public provisions for railway infrastructure in accordance 
with the principles set out hereinafter. 
Article 5 
1. Any railway undertaking established in accordance 
with Article 3 shall be granted access on equitable 
conditions to national railway 
country of its establishment. infrastructure in the 
(*) OJ No L 156, 28. 6. 1969, p. 1. 2. Subject to the same conditions international 
groupings shall be granted transit and access rights as 
required to operate international services on links 
between the Member States where their constituent 
undertakings are established. 
Article 6 
1. Until the entry into force of common rules on the 
allocation of infrastructure costs, Member States shall 
ensure that railway undertakings and international 
groupings pay access charges based on the principles of 
non-discrimination and fair competition between modes 
of transport. 
2. When the objectives set out in paragraph 1 require 
access charges below those needed to recover the full 
costs of infrastructure, the infrastructure operator shall 
receive compensation from the Member State concerned 
for any losses thereby incurred. 
3. Charges for the use of each route shall be estab­
lished by the infrastructure operator concerned taking 
into account, notably the total train kilometres operated 
and any specific requirements in terms of such factors as 
speed, axle load and the degree or period of utilization. 
No C 34/10 Official Journal of the European Communities 14. 2. 90 
4. The Commission may request the Member States to 
provide any information with regard to: 
— the annual usage of and receipts for routes used by at 
least two railway undertakings, 
— the annual maintenance and investment costs for 
each of these routes, 
— the total compensation provided pursuant to 
paragraph 2. 
SECTION III 
Common principles applying to railway undertakings 
Article 7 
1. Member States shall ensure the legal autonomy and 
management independence of railway undertakings. 
2. Member States shall ensure that railway under­
takings shall be operated on commercial principles and 
shall be free to adjust the nature of their business to the 
market. Railway undertakings shall, in particular, be free 
to: 
— establish or join any international grouping, 
— establish their own internal organization, without 
prejudice to Article 8, 
— control the supply, marketing and pricing of services, 
— take decisions on staff, assets and procurement, 
— develop new markets, technologies and services in 
order to increase profitability in both the short and 
long run, 
— adopt any innovative management techniques 
considered useful, 
— establish activities in fields associated with the 
railways business, including creation of affiliated 
companies and participation in joint ventures, 
— negotiate and establish commercial contracts with 
public bodies, notably in relation to the provision of 
'public service' transport. 
Article 8 
Member States shall lay down provisions requiring 
railway undertakings also operating infrastructure to 
organize their infrastructure and transport operations as 
distinct 'divisions' meeting the requirements in Article 1 
(3) of Regulation (EEC) No 1191/69. The accounts of 
the divisions shall be maintained in such a way as to 
exclude the possibility of any cross-subsidies. Article 9 
1. Member States shall ensure that public railway 
undertakings have, by 1 January 1993, a sound financial 
structure. 
2. 'Sound financial structure' means that the balance 
sheet, established according to generally accepted 
accounting principles and reflecting the real value of the 
assets employed, after taking into account any transfer of 
ownership and financial responsability for infrastructure, 
is such that the long term assets plus a reasonable 
working fund are financed by an appropriate amount of 
capital and by long-term debts. 
3. Member States shall also ensure that any future 
investments in new or expanded activities be covered by 
an appropriate increasing capital. 
4. As far as may be required to comply with 
paragraph 1, and in conformity with Articles 92 and 93 
of the Treaty, Member States may make arrangements 
for an exceptional capital reconstruction. This may in 
particular include the removal of debts, either through 
their assumption by the State or a sinking fund or 
through any other financially equivalent solution. 
SECTION iy 
Final provisions 
Article 10 
The Commission shall be assisted by a committee of an 
advisory nature composed of the representatives of the 
Member States and chaired by the representative of the 
Commission. 
The representative of the Commission shall submit to the 
committee a draft of the measures to be taken. The 
committee shall deliver its opinion on the draft, within a 
time limit which the chairman may lay down according 
to the urgency of the matter, if necessary by taking a 
vote. 
The opinion shall be recorded in the minutes; in 
addition, each Member State shall have the right to ask 
to have its position recorded in the minutes. 
The Commission shall take the utmost account of the 
opinion delivered by the committee. It shall inform the 
committee of the manner in which its opinion has been 
taken into account. 
Article 11 
The provisions of this Directive are without prejudice to 
the Council Directive on procurement procedures of 
entitles providing water energy and transport services. 
14. 2. 90 Official Journal of the European Communities No C 34/11 
Article 12 
Decision 75/327/EEC (') is hereby repealed. 
Article 13 
1. Member States shall, after consultation with the 
Commission, bring into force the laws, regulations and 
administrative provisions necessary to comply with this 
Directive not later than 1 January 1993. 
0) OJ No L 152, 12. 6. 1975, p. 3. 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 75 
thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European 
Parliament, 
Having regard to the opinion of the Economic and 
Social Committee, 
Whereas one of the objectives of the common transport 
policy is to eliminate disparities in the conditions 
inherent in the concept of public services liable to cause 
substantial distortion in the transport market; 
Whereas the public interest of transport services may 
justify their continued operation under the concept of a 
public service; 
Whereas the arrangements for such an operation should 
be established between the competent authorities and the 
undertakings within the framework of a contract in 
order to ensure the commercial operation of the latter; The provisions adopted pursuant to the first 
subparagraph shall make express reference to this 
Directive. 
2. Member States shall forthwith inform the 
Commission thereof and communicate to the 
Commission the provisions of national law which they 
adopt in the field covered by this Directive, which 
provisions shall be communicated by the Commission to 
the Member States. 
Article 14 
This Directive is addressed to the Member States. 
obligations is no longer justifiable to meet the public 
transport needs, except for the provision of certain 
urban, suburban and regional services; 
Whereas it is therefore necessary to amend Council 
Regulation (EEC) No 1191/69 (l) to lay down the 
general rules governing the public service contracts, 
HAS ADOPTED THIS REGULATION 
Article 1 
Council Regulation (EEC) No 1191/69 is hereby 
amended as follows: 
1. paragraphs 2, 3 and 4 of Article 1 are replaced by the 
following: 
'2. When necessary in order to ensure adequate 
transport on specific routes or in specific areas 
Member States may provide for the establishment or 
continuation of public services on the basis of 
contracts to be negotiated with undertakings in 
accordance with Article 14. 
3. Nevertheless, Member States may maintain 
urban, suburban and regional services subject to the Proposal for a Council Regulation (EEC) amending Regulation (EEC) No 1191/69 on action 
by Member States concerning the obligations inherent in the concept of a public service in 
transport by rail, road and inland waterway 
COM(89) 564 final 
(Submitted by the Commission on 1 December 1989) 
(90/C 34/07) 
Whereas, in the light of the possibilities offered by such 
contracts, the continued imposition of public service (') OJ No L 156, 28. 6. 1969, p. 1.