•£££& COMMISSION OF THE EUROPEAN COMMUNITIES 
gfe£ C0MC9D229 final 
Brussels, 28 June 1991 
C*CTJ^TfT"V j 
Recommendation for a Council decision 
on the opening of negotiations between 
the Community and third countries on 
the rules applicable to carriage of freight and passengers 
by inland waterways between the parties concerned 
Hfc: 
(presented by the Commission) 
Recommendation for a Council decision 
on the opening of negotiations between 
the Community and third countries on 
the rules applicable to carriage of freight and passengers 
by inland waterways between the parties concerned 
Introduction 
1. Until the present time the role played by vessels from third 
countries - with the exception of Switzerland - on the Community 
inland waterway market has been marginal. This situation reflected 
the general political situation and was also due to the limited 
number of connections between the Community waterway network and 
the waterways of third countries. 
2. important changes are currently taking place at both the political 
and transport infrastructure levels. The recent political changes 
in Central and Eastern Europe are leading to a shift from centrally 
planned to market economies more open to Community contacts. This 
development coincides with the forthcoming completion of the Rhine-
Danube link. Also, in relation to German unification, rivers like 
the Elbe and the Oder will in future be better integrated in the 
international Community waterway network. Hence an intensification 
of waterway traffic with third countries in Central Europe has to 
be anticipated and the commercial rules applying to this traffic 
have to be fixed. 
3. As regards the expected traffic volumes on the Rhine-Danube Canal, 
prognoses generally indicate cargo volumes of around 10 Mio tonnes 
for the year 200u(*). The main commodities are expected to be: 
coal, ore, metal products and halffabricats, chemicals and 
agricultural products. 
The Danube fleet consists of roughly 5,500 units with a total 
loading capacity of 4.9 Mio tonnes, compared to a Communitiy fleet 
of 15,000 units with 12,8 Mio tonnes. 
It should be noted that the restricted width of the locks (12 m) in 
the Rhine-Danube Canal does not allow certain units - in particular 
the big push boats - to pass from the Rhine to the Danube bassin 
vice versa. 
(*) Total inland waterway transport within the Community amounts to 
roughly 425 Mio tonnes per annum. 
Assessment 
Existing rules governing waterway transport between Member Statci 
and third countries are fragmented and diverse. Some w^mber States 
have concluded bilateral agreements with third countries or arc 
considering doing so. Other Member States concerned have not yet 
taken any action in this field. 
These bilateral agreements generally contain provisions concerning, 
tariffs in bilateral traffic, traffic sharing exclusively betwee 
the carriers of the two countries concerned and free trans?A< m 
some cases they also provide for limited cabotage rights on the 
basis of special authorizations, and for participation in traffic 
between the contracting state and third countries. 
In order to implement the principle of the freedom to provide 
services, as laid down in Articles 59, 61 and 75 paragraph 1 of the 
Treaty and taking account of the relevant Jurisprudence of the 
Court of Justice*1), all restrictions imposed on Community 
carriers based on their nationality or place of establishment have 
to be abolished. This legal obligation is not restricted to 
internal Community traffic, but equally applies to transport 
between Member States and third countries, since the system of 
internal Community measures implementing the provisions of the 
Treaty may not be separated from that of external relations*2*. 
In addition, agreements on waterway transport cover matters failing 
within the Community's competence pursuant to Article 113 EEC. 
In this context the current bilateral agreements have to be brought 
into conformity with Community law. 
The situation is equally fragmented as regards the existing 
provisions on access to the market in transport between ports 
situated within the territory of the Community (EC cabotage). 
Certain parts of the internal Community market are still reserved 
for national carriers; although the Court of Just iced) has stated 
that the Council has soon to come to an agreement on the Commission 
cabotage proposa I*3). Other parts of the market are open to ai! EC 
and Swiss carriers; whilst for certain other sectors (e.g. North-
South traffic) no such rules on access exist. 
In addition it should be mentioned that some of the bilateral 
agreements referred to in paragraph 4 provide for the possibility 
for the national authorities of the contracting Member State to 
grant on an ad hoc basis special authorizations to third country 
carriers allowing them to carry out national or international 
transport operations between two ports situated within the 
territory of the Community. 
(1) Case 13/83 of 22.05.1985, Recueil 1985, p. 1556 
(2) Case 22/70 (AETR) of 31.03.1971. 
(3) Proposal COM (85) 610 final of 27.11.1985 
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6. A logical consequence of the creation of the internal market for 
the outside world is that the Community will be considered as one 
entity and therefore as a cabotage area. The creation of a cabotage 
area implies that the traffic within and between Member States is 
considered to be equivalent to cabotage and is in principle 
reserved for Community carriers, whereby the existing rights of 
third country carriers laid down in international Conventions shall 
be fully respected. This is currently the case for Switzerland. 
7. Council Regulation (EEC) No. 1101/89 of 27 April 1989 on structural 
improvement measures in inland waterways, established a Community 
programme to abolish structural overcapacity. All Community 
carriers operating on the waterways which are linked to those of 
other Member States are currently subject to the conditions imposed 
by this Regulation, which have an impact both on operating and 
investment costs. The Swiss government has introduced identical 
measures for its fleet. 
Carriers established outside the Community and Switzerland are not 
subject to these rules. 
The organizations representing inland waterway carriers at 
Community level have on various occasions expressed their growing 
concern about the danger of unfair competition from third country 
carriers not being subject to the same economic rules as Community 
carriers. These carriers possibly take the empty places of vessels 
which have been scrapped under the EC scheme at the expense of the 
profession. The preservation of the positive effects of the 
scrapping measures introduced by the Council Regulation mentioned 
above therefore calls for the establishment of common rules on 
access to the market for carriers from third countries. 
Proposal 
8. It is against this background that the Community has to consider 
the development of a Community external relations policy in inland 
waterway transport. 
The third countries concerned are Poland and the contracting states 
to the Danube Convention^1*. Amongst the latter countries Austria 
is in a special position because of its EFTA Membership; see 
further point 10. 
The basic approach envisaged by the Commission towards third 
countries in Central and Eastern Europe as regards inland transport 
is to strive for the establishment of common rules allowing for the 
fullest possible realization of free movement of goods and services 
as well as aiming for the harmonization of transport conditions. 
The realization of this objective is related to progress made in 
the third countries concerned with the conversion of their national 
economies to market principles. With a view to the existing 
uncertainties regarding the timing of this process, it is proposed 
that the negotiations should be conducted in two phases. 
(1) These are: Hungary, Czechoslovakia, Rumania, Bulgaria, USSR, 
Yugoslavia and Austria. 
9. The first phase should concentrate on the cone I us?or* of agreements 
laying down the conditions governing bilateral waterway traffic 
between the Community and the third countries concerned. :c 
cabotage, that is the carriage of cargo between two Commun ity o&rts 
ijy third country carriers, should not be allowed in this phase, 
However, the possibility of consecutive cabotage on a reciprocs: 
basis (the carrying out of a single transport operation between two 
Community ports or between two third country ports on the return 
Journey following a bilateral transport operation) could eventually 
be included In the first phase negotiations, depending on progre 
made with the harmonization of transport conditions. 
If circumstances so permit the second phase, which could start 
after an acceptable degree of harmonization in the working methods 
of the transport companies from the two sides has been achieved, 
should aim at the gradual further liberalization of market access 
in the Danube bassin and on the EC market, whilst laying down the 
economic and administrative conditions governing such operations. 
The present communication is restricted to the first phase. The 
opening of the second phase shall be subject to a separate 
communication to the Council. 
10. In the framework of the current EFTA-EC negotiations on the 
creation of a European Economic Area the issue of mutual free 
access to waterways and freedom of establishment in the area of 
inland waterways forms part of the negotiations. Austria and 
Switzerland are the only EFTA States having direct waterway links 
with the Community. It is understood that in the context of a 
general agreement, the current view is that the relevant acquis 
communautaire in inland waterways will be applicable to EEA 
contracting parties as soon as they get the right of free access to 
Community waterways. This concerns Austria in particular, since 
Switzerland being a contracting state to the Convent''on of Mannheim 
has already free access to a certain extent. 
Whilst awaiting the outcome of the EFTA-EC talks, the negotiations 
proposed by the present communication can be oriented initially 
towards non-EFTA countries. If the negotiations on the European 
Economic Area are successfully concluded along the lines indicated 
above, there will be no need for bilateral negotiations with EFTA 
countries since the EEA agreement is expected to fully provide for 
Community requirements. However, if the outcome of the EEA exercise 
were to turn out not to cover sufficiently the issue of bilateral 
waterway transport, the negotiating directives requested by the 
present communication could equally be used to open up negotiations 
with EFTA countries concerned. 
First phase 
11. The negotiations to establish uniform rules governing bilateral 
traffic between the Community and third countries should be 
conducted by the Commission with the assistance of the Member States 
It is envisaged that experts of these Member States would be 
requested to advise the Community negotiating delegation. 
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The organizations representing inland waterway carriers at 
Community level should be consulted by the negotiating team at 
regular intervals and their views taken into account in the course 
of negotiations. 
12. Agreements with non Member States should contain provisions on 
transport prices, market access and traffic sharing, whereby the 
contracting parties should agree to eliminate any form of direct 
state aids for operating costs, and to create equal conditions for 
access to the market of carriers from the two parties in the 
traffic concerned. 
Furthermore, these agreements should cover those economic, 
administrative and technical rules that have an impact on transport 
operations; the aim should be to remove existing problems and be 
based on the principle of equal treatment between Community 
carriers and carriers from the other contracting party in bilateral 
traffic. 
13. In conclusion, Community agreements with third countries on 
bilateral waterway traffic would provide the following advantages: 
- a - clear, fair and efficient principles will be established 
for the industry in developing links to non-Member States; 
- b - equal market opportunities will be guaranteed for all EC 
carr iers; 
- c - distortion of competition will be avoided by applying the 
principle of equal treatment between carriers of both 
sides; 
- d - it will be ensured that the results achieved by Council 
Regulation (EEC) No. 1101/89 are not endangered or 
negatively affected as a result of the intensification of 
East-West trade; 
- e - a maximum of transparency and simplicity in the 
administrative rules governing bilateral transport can thus 
be obtained; 
- f - the Community could demonstrate its commitment to be 
outward looking in its inland waterway policy and open to 
exchanges with third countries. Agreements on bilateral 
traffic can serve as an introductory step towards further 
liberalization and cooperation. 
14. At this stage, it is unnecessary to specify a precise legal basis 
for the determination to begin negotiations in accordance with 
certain negotiating directives. Indeed it is at present not 
possible to be completely certain about the precise legal basis 
which will be needed for a decision by the Community to conclude a 
future agreement pursuant to Article 228 EEC, since it will depend 
on the precise content of the agreement which will emerge. 
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15. Consequently, the Commission recommends to the Cou» i! to decide 
that : 
the Community shall engage in negotiations with the third 
countries mentioned above in points 8 and 10 on the rules 
applicable to carriage of freight and passengers by inland 
waterways between the parties concerned; 
the Commission conducts these negotiations with the assistance 
the Member States and according to the directives contained ! 
the annex hereto. 
Annex 
Negotiating Directives 
1. General objective 
The general objective of the negotiations is to conclude one or 
more agreements between the Community and certain third countries 
on rules for the carriage of freight and passengers by inland 
waterway between the Community and these States. Without 
necessarily taking place simultaneously, these negotiations will be 
conducted with each of the third countries concerned with a view to 
concluding either a number of bilateral or multilateral agreements 
or a single multilateral agreement.A further objective is to ensure 
equal treatment for all parties. 
2. Scope 
These negotiations shall cover the commercial, technical and 
administrative aspects of the relationship between the Community 
and third countries in the field of inland waterway transport. In 
the light of the present political and economic situation, the 
negotiations should concentrate on laying down the rules governing 
bilateral traffic between the Community and third countries. 
Furthermore, the possibility of consecutive cabotage (the carrying 
out of a single transport operation between two Community ports or 
between two third country ports on the return Journey following a 
bilateral transport operation) could be included in the 
negot iat ions. 
3. Particular objectives 
The agreements shall lay down the rules for the organisation of the 
market following commercial economic principles. The agreements 
shall in particular contain provisions on market access, transport 
conditions and prices. The establishment of fair and equal 
conditions of competition resulting in prices that cover costs and 
offer the possibility of a fair participation for carriers from the 
two sides should be envisaged. 
In the framework of these agreements, the administrative, technical 
and economical rules governing these transport operations should be 
harmonized and simplified as far as possible to facilitate a 
prosperous development of waterway traffic between the contracting 
Parties. 
4. Entry into force 
The negotiations will be conducted with all third countries 
referred to in the Commission's communication. However, a separate 
conclusion with a group of countries is not excluded if the result 
of the negotiations should require this in the Community interest. 
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5- Control measures 
Appropriate control measures shall be adopted to ensure that ths 
provisions of the agreement are respected. 
6. Period of validity of agreement 
The agreements shall be concluded for a period of five years with a 
provision for extension. 
7. Termination of agreement 
Third countries on the one hand or the Community on the other hand 
shall be able to withdraw from the agreement after consulting the 
other parties in advance and on giving due notice. 

ISSN 0254-1475 
COM(91) 229 final 
DOCUMENTS 
EN 07 
Catalogue number : CB-CO-91-293-EN-C 
ISBN 92-77-73909-6 
Office for Official Publications of the European Communities 
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