COMMISSION STAFF WORKING DOCUMENT

Accompanying the document

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on periodic roadworthiness tests for motor vehicles and their trailers and repealing Directive 2009/40/EC and REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the technical roadside inspections of the roadworthiness of commercial vehicles circulating in the Union and repealing Directive 2000/30/EC and DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Council Directive 1999/37/EC on the registration documents for vehicles

|| IMPACT ASSESSMENT ||

|| Final Report of Contributions to Impact Assessment of Policy Options to Improve the EU Systems of PTI and of Roadside Vehicle Testing ||

Europe Economics Chancery House 53-64 Chancery Lane London WC2A 1QU Tel: (+44) (0) 20 7831 4717 Fax: (+44) (0) 20 7831 4515 www.europe-economics.com 02 February 2011

Executive Summary........................................................................................................................ i

1........... Introduction.................................................................................................................... 1

Political context............................................................................................................................. 1

Economic context......................................................................................................................... 2

Legal framework........................................................................................................................... 2

General comment on legal framework............................................................................................ 6

2........... Procedure...................................................................................................................... 7

3........... Problem Definition.......................................................................................................... 7

What is the problem that may require action?................................................................................. 7

What are the underlying causes of the problem?............................................................................. 8

Who is affected and in what ways?.............................................................................................. 19

How would the problem evolve if present policies are maintained?............................................... 20

Does the EU have the right to act and is there evidence of EU added value?................................. 25

4........... Objectives.................................................................................................................... 26

What are the general policy objectives?....................................................................................... 26

What are the more specific/operational objectives?...................................................................... 26

5........... Policy Options.............................................................................................................. 27

Definition of policy options.......................................................................................................... 27

Information exchange.................................................................................................................. 35

Possible combinations of policies................................................................................................. 35

6........... Analysis of Impacts....................................................................................................... 36

Scope of analysis........................................................................................................................ 36

Initial overview of options in relation to objectives........................................................................ 36

Option 1: No new policy action................................................................................................... 37

Option 1a: No new EU legislation, but better implementation........................................................ 47

Option 2: Encourage bilateral agreements.................................................................................... 56

Option 3: Mandatory mutual recognition throughout the EU.......................................................... 60

Option 4: Impose a mandatory EU-wide system for PTIs and roadside testing.............................. 68

Estimated costs to lift all MS to HIGH level................................................................................. 74

Summary.................................................................................................................................... 74

Option 5: Deregulation at EU level............................................................................................... 89

Information exchange.................................................................................................................. 90

7........... Comparison of Options................................................................................................. 93

PTI........ 93

Roadside testing.......................................................................................................................... 94

Data...... 94

Option summary......................................................................................................................... 95

Appendix 1: Expert Workshop.................................................................................................... 96

Attendance List........................................................................................................................... 96

Morning Session......................................................................................................................... 97

The Policy Context and DG MOVE Objectives........................................................................... 97

Social and Economic Benefits of Road Safety.............................................................................. 97

Single Market Aspects................................................................................................................ 98

Discussion.................................................................................................................................. 99

Afternoon Session..................................................................................................................... 100

Group Discussion – Data systems.............................................................................................. 100

Summary from Group Discussion on Potential Impacts of Changes to PTIs................................ 101

Costs of Standardisation – the Case of RDW in the Netherlands................................................ 102

Costs of Standardisation – Presentation by Applus, Spain.......................................................... 103

Group Discussion - Mutual Recognition..................................................................................... 104

Summary from Group Discussion on Potential Cost Impacts of PTI............................................ 105

Appendix 2: Stakeholders’ Meeting........................................................................................... 106

Attendance List......................................................................................................................... 106

Morning Session....................................................................................................................... 107

Discussion................................................................................................................................ 108

Afternoon Session..................................................................................................................... 111

Improved Flows of Information................................................................................................. 111

Interim Analysis of the Internet Consultation............................................................................... 112

First Analysis of the Options...................................................................................................... 112

Comments and Discussion......................................................................................................... 113

Concluding Remarks................................................................................................................. 113

Appendix 3: Public On-line Consultation.................................................................................... 114

Respondent profile.................................................................................................................... 122

Experience of PTIs................................................................................................................... 126

Impression of the overall efficiency and value for money of the test............................................. 127

Experience of Roadside Inspections.......................................................................................... 135

Standardisation across Europe.................................................................................................. 135

Access to Test Results.............................................................................................................. 139

Level of Complexity of the System............................................................................................ 139

Exchange of Data...................................................................................................................... 140

Testing in other Member States................................................................................................. 141

Policy Options.......................................................................................................................... 142

Appendix 4: Improved Information Availability.......................................................................... 146

Suggested Aims of a Harmonised Data Exchange...................................................................... 148

Cost Benefit Analysis................................................................................................................ 163

Appendix 5: Potential Levels for Roadside Inspections............................................................... 169

Appendix 6: European Approaches to Monetising the Value of Road Safety.............................. 171

‘The million Euros rule’............................................................................................................. 171

HEATCO Recommendation..................................................................................................... 171

Country-level Official Estimates................................................................................................. 172

Other Estimates........................................................................................................................ 173

Appendix 7: Calculating the Total Cost of PTIs in Europe.......................................................... 174

IMPACT ASSESSMENT

Executive Summary

1 This report presents the conclusions of a project carried out by Europe Economics, advised on certain issues by DEKRA and CENTIQ, to assist DG MOVE in preparing an impact assessment of policy options to improve the EU systems of periodic technical inspection of vehicles (PTI) and of roadside testing. The conclusions drawn are the sole responsibility of Europe Economics.

1.1.1. Context

2 The EU is committed to improving the level of safety of road transport, and sees the system of vehicle testing as playing an important part in achieving this.

3 EU legislation in this field has recently been revised, and reflects a policy of increasingly detailed regulation. The legislation takes the form of Directives, binding on Member States, rather than Regulations, directly binding on individuals and businesses.

4 The economic context is such that it is even more important than in more prosperous times that no new regulations should be imposed unless there is a clear benefit to the consumer.

1.1.2. Consultations

5 An experts’ workshop and a stakeholders’ meeting were held in Brussels in August and September, respectively; and a public on-line consultation was conducted between 30 July and 24 September, attracting almost 10,000 replies. Half of the respondents felt that PTIs were excellent value for money, and only 5 per cent found them insufficient.

6 A number of written contributions were also received from stakeholders. These consultations provided information which is taken into account in this impact assessment.

1.1.3. Problem definition

7 Two related issues are under consideration, linked by the fact that improvements to the system of vehicle inspections might contribute to their solutions.

8 These issues are:

(a) Significant numbers of accidents still occur on the roads of EU Member States, costing lives and injury, and causing other social, economic and environmental damage.

(b) The full potential of the EU single market is not being achieved, since different Member States require different systems of testing and there is no mutual recognition of the validity of tests.

9 It is recognised that there may be trade-offs between these objectives, and that they may be seen as opportunities for improvement rather than as problems demanding immediate solution.

1.1.4. Causes of the problems

10 The causes of road accidents are primarily mistakes by drivers, but vehicle faults also contribute. A significant proportion of vehicles subjected to roadside tests in several Member States were found to have some faults.

11 The reasons why there are different system of testing in use is partly that circumstances differ and partly that expert opinions on what is the most efficient method also differ.

12 There is no underlying reason why Member States should seek different outcomes than those that would be optimal for the EU as a whole.

1.1.5. Who is affected?

13 A wide constituency of road users; businesses making vehicles, testing equipment and carrying out tests; and regulatory authorities are affected by road safety issues and may be affected by differences between Member States.

1.1.6. How would the problem be likely to evolve on unchanged policies?

14 There has been good progress in reducing the number of road accidents, and this would continue. Initiatives taken by some Member States toward bilateral mutual recognition, and recent European Court of Justice (ECJ) decisions, would help to alleviate some of the disadvantages of differences in testing systems.

15 It is not possible to forecast with confidence whether or not the EU political objective of halving the numbers of fatalities by 2020 will be achieved on present policies.

1.1.7. Does the EU have the right to act and is there evidence of EU added value?

16 The EU has recently passed legislation controlling both PTI and roadside testing, so the legal precedent for action in this area has been established.

17 PTI is not an area in which it is immediately obvious that the EU is a more efficient level of government than Member States, and we assume that consensus would be needed before significant changes are brought into effect, particularly if changes were to require any major additional costs. This is taken into account in analysis of policy options.

18 With regard to roadside testing, it is hard to see any requirement for action at EU level. The damage done by inadequate roadside tests falls on the road users in the Member State concerned; there is hardly any implication for other parts of the EU.[1] Nor is it necessary for similar approaches to be taken in different Member States; apart from facilitating statistical comparisons, harmonisation in itself would not deliver concrete advantages.

1.1.8. Policy objectives

19 The general policy objectives are to:

(a) improve the systems of PTI and roadside testing in order to reduce the number and severity of road accidents;

(b) reduce the costs and administrative burden for people and businesses wishing to have their vehicles tested in different countries, and facilitate other improvements in the operation of the EU single market.

20 More specific objectives are to:

(a) reduce the proportion of vehicles which are not compliant;

(b) make it easier for vehicles to be tested wherever is most convenient;

(c) increase recognition of tests undertaken in other Member States;

(d) increase the scope for vehicle-testing stations to offer services to vehicles registered in other Member States;

(e) make it easier for those carrying out PTIs and roadside tests to have reliable information on the vehicle; and to

(f) support consumer protection in the second-hand vehicle market including milometer readings.

1.1.9. Policy Options

1.1.9.1. Option 1: Continuation of present policies

21 Option 1 provides the counterfactual case against which the effects of other policy options are to be compared. The case for a new policy intervention needs to be established.

1.1.9.2. Option 1a: No new legislation, but enhanced implementation and enforcement

22 There would be increased effort by the Commission to improve the standards of testing and to increase the advantages for citizens and EU businesses of the single market. This would involve increased use of some or all of the following:

(a) peer reviews and screening (European Commission (EC));

(b) exploration of optimal levels of investment in PTI and roadside testing (EC, Member States (MS));

(c) exploration of the scope for risk-based testing regimes (EC, MS);

(d) PR campaigns focusing on the actions that vehicle owners should be taking (EC, MS);

(e) enhancement of roadside inspections and testing supervision (MS);

(f) voluntary action by vehicle manufacturers (manufacturers);

(g) the Commission services could prepare to institute infractions proceedings if required (EC).

1.1.9.3. Option 2: Encourage bilateral agreements and better implementation

23 Under this option, in addition to better implementation of the present law as in Option 1a, Member States would be encouraged to seek bilateral or multilateral agreements for the mutual recognition of tests done in either country.

24 As with Option 1a, no new legislation would be needed to pursue Option 2.

1.1.9.4. Option 3: Mandatory mutual recognition throughout the EU

25 This option would introduce new legislation to require each Member State to recognise the validity of vehicle testing carried out in any other Member State. This would mean that:

(a) any vehicle could be inspected in any Member State;

(b) Member States would be obliged to recognise the certificates issued by other Member States as equivalent to theirs (with no additional requirements or conditions).

26 However, the frequency of the PTI in the Member State of registration would have to be respected.

27 There would be a need to define the information exchange standards required for mandatory mutual recognition and minimum data visibility, and perhaps to provide infrastructure to facilitate data exchange.

1.1.9.5. Option 4: Impose a mandatory standard EU-wide system for PTI and roadside testing

28 Under Option 4, in addition to requiring mutual recognition new legislation would prescribe the minimum standard of testing to be required. Thus PTI and roadside testing requirements would include details of:

(a) items to be inspected and inspection method;

(b) definition of defects and assessment of result of test;

(c) equipment to be used;

(d) skills or training of staff;

(e) vehicle classes to be inspected;

(f) frequencies of PTI;[2]

(g) the system for supervision and enforcement; and

(h) the system for information exchange.

29 Member States would be permitted to apply tests that were above the minimum standards, but could not require the same from other Member States whose certificates they would be obliged to recognise. Thus Option 4 would include mutual recognition as in Option 3, but also require more standardisation of testing methods.

30 Three different possible levels of PTI testing were outlined by DEKRA for the purposes of this impact assessment:

– Option 4a: Least rigorous

– Option 4b: Medium level

– Option 4c: High level.

1.1.10. Analysis and comparison of impacts

1.1.10.1. PTI

31 Under Option 1 the system would continue to improve, and more Member States may decide to implement bilateral agreements for mutual recognition. However, the full potential single market benefits could not be achieved, and scope for faster progress in reducing road accidents might be missed. By definition, costs and benefits of Option 1 are zero.

32 Option 1a offers potentially very cost-effective improvements. Improving road safety in a cost-effective manner is supported by all concerned, and the scope for system improvements facilitated by the Commission seems substantial; at little cost. However, there is no guarantee that single market issues would be solved in this way.

33 Option 2 addresses the single market issues directly, but on a partial basis. It is likely to be inexpensive; and to reduce the scale of the single market issues while not offering a complete solution. We see no reason not to pursue Option 2 as an increment to Option 1.

34 Option 3 is more problematic at this stage, since although it would solve all single market issues it carries some risk of lower road safety standards. However, the assessment of this option suggests that it may be beneficial.

35 Option 4 would take the EU into new regulatory territory, as the present legislation does not address all of the eight “pillars” by which an ideal PTI system might be defined. Research suggests that there is a case for increasing some of these standards, but in current economic circumstances it would be important to be quite sure that the additional costs would be justified for lower-income Member States in particular. We have found no adequate research into the costs and benefits of most of the “pillars” of an ideal testing system.

36 The options form a natural progression, in the sense that by pursuing Options 1a and 2 more information would become available, that might inform a decision on Options 3 (mutual recognition) and possibly ultimately of 4 (imposition of more detailed technical standards at EU level).

1.1.10.2. Roadside testing

37 It is not necessary for the EU to specify details of roadside testing systems, since these can safely be left for decision by Member States.

1.1.10.3. Data

38 Under any option, it would be advantageous to facilitate exchange of data between Member States (although not all of those replying to the on-line consultation thought that this should be done).

1.1.11. Annex: Data exchange system

39 The study specifically requested that the current and potential use of data be reviewed, whilst the impact of setting up both national and international databases and the interchange and sharing potential of the data stored be investigated. The highlighted areas of interest were: registration and roadworthiness testing-systems and type-approval and chain of custody (COC) documentation systems. Most focus was placed on the roadworthiness testing-systems as these were seen as more relevant to the overall study.

40 Responses from the Member States were limited, yet the evidence from the responses received was that roadworthiness testing results are being stored within national databases - yet the type, method and level of information held varies from state to state.

41 Many Member States are also introducing COC document stores at the national level and are considering type-approval registration systems. The best design for such a system is open to debate. The value of moving to an international system (as opposed to a national system of data-exchange) needs to be challenged as the majority of vehicles - and therefore use for type approval and COC documentation - remain in the country of first registration. There is also the variance of vehicle models across Member States to consider. For those limited occasions where access to out-of-country COC and type-approval information is required the use of a data-exchange system is expected to be more effective (the costs of setting up such a system and also data-exchange system costs are covered from Appendix A4.62 onwards).

42 The study looked at the usage of data by various stakeholders to confirm the most effective manner of data exchange, and whether the focus on COC and type-approval systems is correct. However, input from stakeholders and Member States was limited and showed that whilst the idea of data sharing is sound there is little quantitative evidence supporting its use, neither are there expectations for data volumes or timeframes for data availability to meet user demand.

43 Finally this study shows that a differentiation between strategic planning and operational support systems needs to be made in order to provide a cost-effective design. A full explanation of these systems is in Appendix 4: .

1 Introduction

1.2 This is the final report of Europe Economics’ input to the impact assessment which DG MOVE is to prepare, to consider policy options to improve the working of systems of periodic testing of vehicles and of roadside tests in the EU.

1.3 An impact assessment does not pre-judge the final decision to be taken by the European Commission.

1.2. Political context

1.2.1.1. Road safety

1.4 The Commission has recently adopted a major policy orientation towards transport policy and road safety in particular.[3] This states:

In view of achieving the objective of creating a common road safety area, the Commission proposes to continue with the target of halving the overall number of road deaths in the European Union by 2020 starting from 2010. Such a common target represents a significant increase of the level of ambition compared to the unmet target of the current RSAP [Road Safety Action Programme], considering the progress already achieved by several Member States during the past decade, which will give a clear signal of Europe's commitment towards road safety.

1.5 The Commission has adopted a Communication on better use of communications technology. A key action to promote interoperability between public administrations will be the Commission's adoption of an ambitious European Interoperability Strategy and the European Interoperability Framework to be drawn up under the ISA programme (Interoperability Solutions for European Public Administrations).

1.2.1.2. Single Market

1.6 At the end of 2009, Former Commissioner Monti was invited to write a report encouraging a renewed political determination around the concepts of the EU’s single market and providing a fresh impetus for policies to achieve it. It is hoped that his report will help to re-launch the Single Market as a key strategic objective of Europe.

1.7 Continued development of the EU single market has indeed always been one of the Commission’s most important long-term goals.

1.3. Economic context

1.8 The economic context in which DG MOVE is formulating its policies is one in which many or even all of the EU Member State Governments are seeking substantial reductions in public expenditure, while also seeking to avoid any unnecessary burdens of cost on businesses and on the personal sector. This situation is likely to continue for a long time, and to require a significant reduction in the role of the state in many parts of the economy. It is even more important than in more prosperous times that any new regulations should bring benefits that clearly outweigh any additional costs they would impose.

1.4. Legal framework

1.9 Before outlining the policy options to be considered, we first summarise the present legal framework and describe the aspects of Periodic Technical Inspections (PTI) and roadside testing to which the policy options will relate.

1.10 The current legislation on roadworthiness and on roadside testing is laid out in the following Directives:

(a) Directive 2000/30/EC – Roadside technical checks;

(b) Directive 2009/40/EC – Roadworthiness directive;

(c) Directive 2010/47/EU – amending Directive 2000/30/EC;

(d) Directive 2010/48/EU – amending Directive 2009/40/EC.

1.11 In addition, the Commission has issued two recommendations:

(a) Recommendation 2010/378/EU – Assessment of defects during roadworthiness testing;

(b) Recommendation 2010/379/EU – Risk assessment of deficiencies detected during technical roadside inspections (of commercial vehicles).

1.1.12. Directive 2000/30/EC (Roadside checks)

1.12 Directive 2000/30/EC was adopted in June 2000. It required all Member States to introduce technical roadside inspections[4] designed to improve road safety and the environment by ensuring that vehicles comply with certain technical conditions.

1.13 These roadside inspections were required to comprise at least a visual assessment of the maintenance condition of the commercial vehicle (whilst stationary) or else a check on a recent document attesting to the vehicle’s technical roadworthiness. The inspection may also include a check for irregularities in one or more of the vehicle parts.

1.14 In addition to this, it was recommended that the inspection should include an examination of the braking systems and exhaust emissions of the vehicles. Specific conditions concerning the required testing process for brakes and exhaust emissions are laid out in the Directive.

1.15 The Directive also includes a provision requiring each Member State to collect data, communicated to the Commission every two years, on the number of commercial vehicles checked, classified by category and country of registration, and the items checked and defects noted.

1.1.13. Directive 2009/40/EC (Periodic inspections of vehicles)

1.16 Directive 2009/40/EC was adopted in May 2009, recasting previous legislation (96/96/EC). It:

(a) requires that vehicles registered in each Member State undergo periodic roadworthiness tests;

(b) defines in detailed Annexes the minimum categories of vehicles to be tested, how frequently the tests must take place (e.g. annually for lorries; once every two years for cars after four years in service) and the items to be tested;

(c) requires that proof of having passed a test be available;

(d) allows some exemptions (e.g. classic cars; military vehicles);

(e) permits Member States the freedom to implement a more stringent roadworthiness periodic testing regime than detailed in the Directive;

(f) requires or allows the Commission to adopt further Directives to lay down more specific rules regarding the minimum standards to be used in tests.

1.1.14. Directive 2010/47/EU (Roadside checks)

1.17 This new Directive amends the technical annexes of Directive 2000/30/EC, aiming to improve technical roadside inspections in the EU by adapting standards and methods in accordance with technological progress. It re-affirms the importance of commercial vehicle maintenance and inspection to ensure road safety, environmental protection and fair competition when circulating within the EU.

1.18 The requirements for roadside inspections are focused primarily on brakes and emissions. No selection criteria are given for vehicles or targets for numbers of vehicles to be tested.

1.19 To enable correlations to be drawn between test results, defects and the specific characteristics of each vehicle inspected, a more detailed standardised inspection report is required by this new legislation.

1.20 The inspection must also cover identification of the vehicle in order to ensure that the correct inspections and standards are applied, to enable the results of the inspection to be recorded and to assist in the enforcement of other legal requirements.

1.1.15. Directive 2010/48/EU (Periodic inspections of vehicles)

1.21 Directive 2010/48/EU amends Directive 2009/40/EC and seeks to achieve further harmonisation of road-worthiness testing by introducing specified testing methods for each of the test items.

1.22 To facilitate further harmonisation and to help to achieve greater consistency of standards, a non-exhaustive list of the main reasons for failure (as already included for braking systems) was added for all test items.

1.23 Specific requirements for particular vehicle categories were added to move towards having roadworthiness tests cover all items relevant to the specific design, construction and equipment of the tested vehicle.

1.24 Member States have extended the periodic test requirement pursuant to Article 5(e) of Directive 2009/40/EC to other categories of vehicles. For the purpose of further harmonised testing, this amendment also outlined testing methods and standards for these categories of vehicles.

1.25 In addition to the items related to safety, security and environmental protection, the requirements for the test cover identification of the vehicle in order to ensure that the correct tests and standards are applied, to enable the results of the test to be recorded and to enable enforcement of other legal requirements.

1.26 The Directive requires that in order to facilitate the functioning of the internal market, and to improve methods of roadworthiness testing, the results of a test should be set out in a roadworthiness certificate covering certain core elements.

1.1.16. Recommendation 2010/379/EU (Roadside checks)

1.27 Commission Recommendation of 5 July 2010 deals with certain issues, regarding the risk assessment of deficiencies detected during technical roadside inspections (of commercial vehicles) in accordance with Directive 2000/30/EC.

1.28 The Recommendation provides a guideline on standards and testing methods for the assessment of deficiencies listed in Annex II of Directive 2000/30/EC for inspectors conducting technical roadside inspections, in order to achieve a more harmonised roadside testing system and to avoid unequal treatment at technical roadside inspections.

1.1.17. Recommendation 2010/378/EU (Periodic inspections of vehicles)

1.29 Commission Recommendation of 5 July 2010 addresses certain issues regarding the assessment of defects during roadworthiness testing in accordance with Directive 2009/40/EC.

1.30 The Recommendation provides a guideline on standards and testing methods referred to in 2009/40/EC for inspectors conducting vehicle tests in order to ensure a harmonised assessment of the failures listed in Annex II of the Directive. The Recommendation is seen as a step towards a uniform assessment of the deficiencies identified during roadworthiness testing within the EU.

1.31 Three categories of failure are introduced, to reflect the seriousness of the defect, with the consequences for the use of the vehicle in that condition given as shown in the following table.

Table Error! No text of specified style in document..1: Categorisation of failures found during periodic testing of vehicles

Type of defect || Definition || Action

Minor || Technical defects that have no significant effect on the safety of the vehicle and other minor non-compliances. || The vehicle does not necessarily have to be re-examined as it can reasonably be expected that the detected defects will be rectified without delay.

Major || Defects that may prejudice the safety of the vehicle or put other road users at risk and other more significant non-compliances. || Further use of the vehicle on the road without repair of the detected defects is subject to conditions. The competent authorities in the Member States must adopt a procedure for setting the conditions under which the vehicle may be used before passing another roadworthiness test.

Dangerous || Defects that constitute a direct and immediate risk to road safety. || The vehicle should not be used on the road under any circumstances.

Note: A vehicle having defects falling into more than one defect group is classified according to the most serious defect. A vehicle showing several defects of the same group can be classified in the next more serious group if their combined effect makes the vehicle more dangerous.

1.5. General comment on legal framework

1.32 The EU legislation governing both roadside tests and periodic testing of vehicles is very recent, and represents increasingly detailed regulation. The legislation takes the form of Directives, binding on Member States, rather than Regulations, directly binding on individuals and businesses.

1.33 In some Member States, further law makes it an offence for an individual or business to put a vehicle onto the roads in an unsafe condition; and an offender would be liable both to punishment and to find that his vehicle’s insurance policy was invalid.

1.34 Regarding commercial vehicle operations, in order to be engaged in the occupation of road transport operator Regulation EC No 1071/2009[5] requires that the operator be standing in good repute. A condition of maintaining good repute is that (Chapter II, Article 6:1):

(b) the transport manager or the transport undertaking have not in one or more Member States been convicted of a serious criminal offence or incurred a penalty for a serious infringement of Community rules related in particular to:

[…]

(iv) the roadworthiness of commercial vehicles, including the compulsory technical inspection of motor vehicles;

1.35 If a transport manager comes to lose their good repute, their authorisation to engage in the occupation of road transport operator is suspended or withdrawn.

2 Procedure

1.36 Research to formulate this impact assessment was carried out by Europe Economics with the support of DEKRA and CENTIQ. Europe Economics is responsible for the main analysis and conclusions drawn, which do not commit either DEKRA or CENTIQ. Where evidence or judgements are provided by the sub-contractors this is made clear in the text.

1.37 An experts’ workshop was held in Brussels on 31 August 2010, attended by 32 experts. Participants are listed in Appendix 1: , with a note of the discussion.

1.38 A stakeholders’ meeting was held in Brussels on 8 September 2010, attended by 30 stakeholders. Participants are listed in Appendix 2: , again with a note of the discussion.

1.39 A public on-line consultation was conducted between 30 July and 24 September 2010, attracting 9,653 replies. A copy of the questionnaire and of the tabulated main results is in Appendix 3.

1.40 In addition to the questionnaire responses, a number of written contributions were also received from stakeholders. These were submitted as attachments to on-line questionnaire responses or sent by email to DG MOVE.

1.41 These consultations provided useful information which is taken into account in this IA. The consultation processes are in line with EC recommended practice (e.g. for the period during which the on-line questionnaire was open).

3 Problem Definition

1.6. What is the problem that may require action?

1.42 It is normally regarded as good practice in policy formation to clearly define a single problem, and then to analyse which options might be best to help to solve it. However, in this case two related issues are under consideration, linked by the fact that improvements to the system of vehicle inspections might contribute to their solutions.

1.43 These issues are:

(a) Large numbers of accidents still occur on roads of EU Member States, costing lives and injury, and causing other social, economic and environmental damage. This remains the case despite significant improvements in the design and standards of vehicles and vehicle testing and in road management that have contributed to improvements in road safety.

(b) The full potential of the EU single market is not being achieved, since:

– individuals wishing to use the right to move and reside freely within the EU[6] may face inconvenience and costs arising from differences in the systems of vehicle registration and PTI testing;

– transport firms wishing to use the right to freedom of trade within the EU may face inconvenience and costs arising from differences in the systems of vehicle registration and PTI testing; and

– testing services are limited in the extent to which they can compete for business from other Member States.

This second issue might be regarded as an opportunity for improvement rather than as a problem demanding a solution.

1.44 It is useful to note at this point that there may be trade-offs between these objectives, so that under some scenarios progress towards mutual recognition might imply some reduction in safety. Other issues such as the desirability of reducing environmental pollution and the administrative burden on businesses and individuals are also relevant.

1.7. What are the underlying causes of the problem?

1.7.1.1. Road safety

1.45 The causes of road accidents are primarily mistakes by drivers, the consequences of which are exacerbated by road conditions, bad weather and the like, but vehicle faults also contribute. For example, 1.7 per cent of accidents in Germany in 2009 were attributed to faulty brakes, and a significant proportion of vehicles subjected to roadside tests in several Member States were found to have some faults.

1.46 Studies of crashed vehicles have shown that defects contribute directly or substantially from around 3 per cent to 19 per cent of accidents, with the more robust studies indicating at least 6 per cent.[7] Recent empirical evidence from Germany has shown that technical defects are a contributory factor for around 10 per cent of accidents as seen in the following figure.

Figure Error! No text of specified style in document..1: General causes of accidents involving personal injury in Germany, 2009

Source: Federal Statistics Office, Germany

1.47 Commercial vehicles cause disproportionately high levels of accident deaths and injuries whilst breakdowns of commercial vehicles are also a significant cause of traffic congestion.[8]

1.48 The age of a vehicle is a significant factor. Twice as many vehicles which are eight years or older are involved in accidents attributable to technical defects than newer vehicles. Currently the average age of the vehicle fleet in the EU is 8.5 years.[9] Analysis of results by the DEKRA Inspection Department showed that, across all car age ranges, 24.9 per cent of cars involved in a road accident were found to have serious faults, whereas only 11.3 per cent of accident cars under three years old had any such faults.[10]

Figure Error! No text of specified style in document..2: Cars with faults discovered after road accidents, relative incidence by vehicle age in years

Source: DEKRA, Road Safety Report 2008: Strategies for preventing accidents on Europe’s roads

1.49 This chart takes the number of accidents involving vehicles aged 0-3 years as 100, and shows accident rates for older vehicles in relation to this.

1.50 Comparison of accident figures on the basis of the distances travelled shows that older vehicles are involved in accidents twice as often as newer vehicles. Older vehicles are responsible for more fatal accidents than newer vehicles.[11]

1.51 In addition, although the technical condition of a vehicle deteriorates with vehicle age in some cases less money is spent on maintenance and repairs for older vehicles, and the older the vehicle, the more often repairs are performed on a “do-it-yourself” basis or with the assistance of private acquaintances; this applies equally to accident repairs.

1.52 A comprehensive study by the Monash University Accident Research Centre (Australia) under the title “The effect of vehicle roadworthiness on crash incidence and severity” compares the results of important studies.[12] There was significant variation in the study findings regarding the role of vehicle defects in accident causation, and the effectiveness of PTI programmes in reducing defects and accidents related to vehicle age. Overall, the study concludes that it would appear that vehicle defects are a contributing factor in over six per cent of accidents. As evidence of the effects of PTI programmes on vehicle defects and accidents in general, the prevalence of defects in the vehicle fleet was found to be lower in jurisdictions with PTIs (by up to 16 per cent). Comparisons of inspected cars and non-inspected cars in the same jurisdictions suggested lower accident rates for the former.

1.53 Studies that have compared accident rates before and after the introduction of PTIs have generally shown decreases in injury accident rates. Rompe and Seul (1985)[13] noted that inspection programmes may also influence and reduce accidents by increasing drivers’ understanding of the need for regular maintenance, of safety issues and of the condition of their own car.

1.54 Moreover, failure rates in PTI tests are high. A study by the UK Government published in 2008 found that in the UK PTI test, the ‘MOT’, about one third of vehicles tested failed, and that this proportion had remained at about this level for some years.

1.55 The UK study mentioned above estimated that about 10 per cent of cars on roads in Great Britain at any point in time have a defect that would cause them to fail the MOT test.[14] It was concluded that if the UK were to reduce the frequency with which vehicles are tested to the EU legal requirement, the likely costs to the economy from additional accidents would exceed the benefits to vehicle owners from not needing to have the tests done. (The benefit to owners from not having to take the tests was measured as the saving of the money spent on the tests and the value of time taken.)

1.56 Other countries also report high failure rates in PTI tests.

1.57 Further evidence, if it is needed, that significant numbers of unsafe vehicles are using roads in the EU comes from roadside tests on commercial vehicles. These tests are carried out using different techniques in different countries, so that one cannot draw comparisons as to the absolute numbers of unsafe vehicles on a like-for-like basis, but for our immediate purposes this is immaterial. Almost all of the tests reported a significant number of vehicles failing the roadside tests.

Table Error! No text of specified style in document..2: Failure rates in roadside tests, 2007-2008

Reporting Member State || Vehicles checked || % Non-compliant vehicles^

Austria || 12,658 || 41.4 %

Belgium || 18,732 || 13.3 %

Bulgaria || 472,324 || 0.3 %

Cyprus || 919 || 197.3 %^^

Czech Republic || 52,842 || n/a

Germany || 2,679,907 || 2.3 %

Denmark || 265 || 63.0 %

Estonia || 2,236 || 19.2 %

Finland || 9,267 || n/a

France || 1,669,391 || 3.3 %

Greece || 22,360 || 14.2 %

Hungary || 351,690 || 6.5 %

Ireland || 5,204 || n/a

Italy || 13,577 || n/a

Lithuania || n/a || n/a

Luxembourg || 896 || 33.0 %

Latvia || 9,294 || 0.5 %

Malta || 3,579 || 55.2 %

Netherlands || 4,147 || 2.8 %

Poland || 1,254,706 || 0.6 %

Portugal || 558 || 5.0 %

Romania || 43,700 || 36.8 %

Sweden || 165,263 || 20.0 %

Slovenia || 3,179 || 3.8 %

Slovakia || 4,631 || n/a

United Kingdom || 165,927 || 48.9 %

TOTAL || 6,967,252 ||

Source: EC, Report on the technical roadside inspection of the roadworthiness of commercial vehicles

^ The percentage of non-compliant vehicles can be more than 100 per cent due to the counting of vehicle combinations "road train" and "articulated vehicles" as single vehicles where both vehicles or the combination or only one of them could be counted as a non-compliant vehicle.

^^ The figure of 197.3 per cent in Cyprus is probably based on a different method of counting checks and non-compliant vehicles.

1.58 Clearly, different countries took different approaches in deciding how many vehicles to test. The lowest number of inspected vehicles in a Member State was 265 in Denmark, followed by Portugal (558 vehicles) and (less surprisingly) Luxembourg (896 vehicles). In Germany, France and Poland large numbers of vehicles were stopped (2,679,907, 1,669,391 and 1,254,706, respectively) but a relatively small percentage were found defective. In the UK, Sweden, Luxembourg and Austria, smaller numbers were stopped, presumably due to more stringently selecting those vehicles which looked likely to have problems and a higher percentage was therefore found defective.

1.59 Recital 10 of Directive 2000/30/EC requires that roadside inspections in each Member State utilise a targeted approach in their selection of vehicles. This is because the direct benefit to road safety of undertaking roadside inspections is related to the number of vehicles inspected which are detected as non-compliant, rather than the total volume of vehicles inspected. Targeting helps to maximise the number of non-compliant vehicles detected for a given budget, but also means that the statistics derived from results of roadside tests are not representative of the vehicle fleet in each Member State as a whole. It thereby reduces the comparability of roadside testing results between Member States, decreasing the value of these data in comparing the quality of PTIs in each country.

1.60 The share of non-compliant vehicles out of the inspected vehicles in a Member State ranged from 0.3 per cent in Bulgaria to 63 per cent in Denmark. For 8 out of the 20 Member States where compliance rates were reported, the rate of non-compliant commercial vehicles was less than 5 per cent, whereas for 7 countries the rate reported was higher than 30 per cent.

1.61 In 11 Member States more than 90 per cent of all inspected vehicles were registered in the Member State.[15] It is clear that in Cyprus or Malta very few foreign commercial vehicles can be found, but this result is perhaps surprising for countries like Poland or Denmark, where a significant number of foreign commercial vehicles are expected to be using the roads.

1.62 Differences are found in the inspection results of vehicles registered in the reporting Member State and the results of vehicles from other EU Member States. For example, in the UK, 38 per cent of locally registered vehicles were found non-compliant at roadside checks, whereas 80 per cent of vehicles registered in another Member State were found non-compliant. In contrast, Belgium found 19 per cent of vehicles locally registered to be non-compliant and a lower percentage of only 10 percent of vehicles registered elsewhere in the EU were found non-compliant.

1.63 The picture of the 2007-2008 roadside inspection (RSI) results is very similar to that of the previous results from 2003-2004. In most cases the failure rates fell between 2003 and 2007 (Denmark -9.1 per cent, Sweden -26.9 per cent, Hungary -3.9 per cent etc.) but in some Member States the rate increased in the newer results (UK +12 per cent, Luxembourg +23 per cent).

1.64 Bearing in mind the different approaches to technical roadside inspections, the most commonly detected deficiencies in roadside tests were lamps, lighting or signalling devices (30 per cent) followed by braking system and components (21 per cent) and wheels / tyres (20 per cent). Deficiencies in other areas[16] were discovered at a much smaller rate.[17]

1.65 We can take it as a firm finding that, despite present EU and national legislation, and despite the natural wish of motorists to be safe, significant numbers of vehicles on EU roads are defective by the standards of the tests.

1.66 It is in theory possible that the standards of the tests are too high and that a ‘failure’ might not be an important matter (for example, hypothetically a Member State could increase the tread required on tyres to a higher level than is really needed, so that a failure to meet the standard would not be an immediately urgent matter; or there may be other minor reasons for failing the test that could reasonably have been left to the vehicle owner to deal with without a regulatory requirement to do so). However, the consensus among those we have been able to consult (admittedly, apart from the large number of individuals responding to the on-line questionnaire, these have mainly been people and organisations professionally involved in testing or in road haulage as a business) is that the tests are not too rigorous, but if anything too undemanding.

1.67 What then are the underlying reasons why so many vehicles are apparently unsafe to drive, and yet are on the roads? A fundamental point is that part of the cost of accidents falls on people other than the driver or owner, so that in the absence of regulation one would expect a sub-optimal level of safety. For this reason, regulation to require satisfactory safety standards is justified. This also explains why it is appropriate that buses and taxis should be tested more frequently than passenger cars; and why a lower rate of testing is used for motor cycles; and none for pushbikes.

1.68 Vehicles are sometimes defective as a result of faulty design or mistakes in the manufacturing process. Such errors occur occasionally, and lead to vehicle recall programmes, but this cannot fully explain the general phenomenon of unsafe vehicles. Defects can sometimes be explained instead by vehicle owners not maintaining their vehicle properly. This is due to the usual human failings of laziness, ignorance and so on, as well as a wish or need to avoid expense where possible.

1.69 The PTI regulations and roadside inspections are intended to improve standards compared with those that motorist and fleet owners would maintain without regulation. This implies that another possible cause of avoidable road accidents is inefficient PTI or roadside inspection.

1.70 PTI is a government requirement, rather than a voluntary choice for individuals, and therefore some consumers of PTIs are likely to aim just to pass the test, as inexpensively as possible. In addition, repair shops can ignore mechanical defects in order to minimise customer hassle or to pocket more inspection fees by increasing the number of inspections performed. On the other hand, repair shops in Member States where both PTIs and subsequent repairs can be performed at the same garage might like to find more faults than there really are, to increase the amount of repair work needed. Hemenway (1989)[18] found evidence that some drivers actively seek out repair shops that perform fraudulent inspections. This has implications for the design of policy, e.g. towards methods of enforcement.

1.71 Governments will have attempted to take into account this possible misalignment of incentives (between themselves, vehicle owners and garages / workshops) in the design of their PTI systems and of their enforcement. The design of an optimal system of testing is not an easy or straightforward matter, but something on which experts may reasonably disagree; however, there appears to be no reason why the public authorities - national governments or regional administrations[19] - responsible for the design, supervision and enforcement of such regulations should not wish to do so effectively.[20]

1.72 As an example, the optimal level of technical inspections is likely to depend on the income per head in the individual Member State, as this will impact on the costs involved if an accident occurs. We see that there is currently a clear correlation between the quality of PTIs in EU Member States and the income per head, as one would expect.

Figure Error! No text of specified style in document..3: Differences in income per head in Member States with differing PTI standards

Source: Eurostat – Euro per inhabitant and population, Europe Economics categorisation of countries into PTI quality groups

Trend line shows weighted average Euro per inhabitant for each PTI quality group.

All values are for 2009 except for Bulgaria, Belgium, and the UK where 2008 values were used and Romania where 2007 values were used.

1.73 In general, the reported government expenditure on national road safety strategies varies greatly in Europe. In all cases (since no amount of expenditure could prevent all crashes) the expenditure by Member States is considerably less than the costs incurred from road crashes.

Table Error! No text of specified style in document..3: Expenditure on implementing national strategies on road safety versus the costs of road crashes, 2008

|| Expenditure on national strategy per person (€) || Cost of road crashes per person (€)

France || 38 || 194

Poland || 17 || 148

Estonia || 12 || 113

Latvia || 3 || 87

Source: WHO European status report on road safety

Note: These calculations are based on the gross output method. The cost components can be divided into the costs of resources consumed because of a crash (property damage costs, health care costs and administrative costs) and costs resulting from a loss of future output (absence from work, long-term disability or death).

1.7.1.2. Single Market

1.74 Turning from road safety to the Single Market issues, the causes of the costs and inconvenience for EU businesses and citizens resulting from absence of a standardised system throughout the EU are historical. The EU is gradually reducing national differences; the present situation can be described either as an improved access of MS citizens to the services of other MS compared with the previous situation, or as a continuing limitation on citizens’ access to the full services of MS other than his or her own (the glass is half full or half empty).

1.75 Currently citizens are still sometimes reluctant to purchase a motor vehicle from another Member State due to the fear that this would require additional paperwork and extra costs. The transfer of motor vehicles is still a source of complaints, in particular due to burdensome type-approval registration procedures.[21]

1.76 The current registration requirements for cars are the natural corollary of the exercise of the powers of taxation by Member States in the area of motor vehicles. People with residence in a Member State need to have any vehicle they are using on the roads in that Member State registered there. When people move residency between two Member States, EU legislation requires that any vehicle must be re-registered in the new Member State after 185 days of residency there.[22] Current national legislation of Member States provides for (a maximum of) three different steps for registering a motor vehicle in the receiving Member State:

– the approval of the technical characteristics of the motor vehicle;

– roadworthiness testing of used vehicles; and

– the registration of the motor vehicle.

1.77 Recent work by the European Commission has helped to reduce the burden of applying for registration of a vehicle in a new Member State. For instance, EC type approval regulations[23] have established mutually recognised type approvals for most vehicles in the EU, making the approval of the technical characteristics of the motor vehicle straightforward in the majority of cases. In addition, recent ECJ judgments[24] have reduced the scope for Member States to request an additional roadworthiness test for used vehicles from another Member State before registration. However, it is thought that some barriers to the registration of used vehicles in a different Member State persist.

1.78 Temporary use of a vehicle in another Member State is allowed without paying taxes in that country. Temporary use is generally defined as less than 6 months in any 12 months in this case. The group of people most likely to wish to store a vehicle in another Member State and to be using it less than 6 months in any year are long-term tourists – e.g. those with a holiday home in a foreign Member State, who therefore intend to return to the same destination over a period of many years and may leave a car there permanently. These people may choose to keep their vehicle registered in their resident MS rather than the MS in which the vehicle is located if this means they save money in insurance premiums, or to avoid any practical difficulties involved in registering the vehicle in the holiday location.[25] In such cases, a demand is created for the mutual recognition of PTIs or PTI results, as these vehicles would most efficiently undertake their PTI in the location they are kept, rather than the country in which they are registered. Without mutual recognition of PTIs the vehicle owners are either required to drive the vehicle back to their resident country in order to undertake a PTI, or incur the costs of changing the vehicle’s registration (which might, however, not be an unreasonable cost in these circumstances).

1.79 Commercial vehicles - and particularly trailers - are more likely to experience costs from the lack of a single EU market for PTIs, due to the higher frequency at which these vehicles will find themselves away from their country of registration due to undertaking long distance haulage.[26] As noted above, there is no obvious reason why Member States should not seek the PTI and roadside-testing systems that they believe are optimal for their circumstances.[27] The current differences may therefore be attributed to different historical developments, differences in the affordability of alternative systems of testing, and different views taken by Member State regulators on the cost-effectiveness of different aspects of the tests. Whatever the reasons for the differences, in the absence of mutual recognition of PTIs some additional journeys may be required.

1.8. Who is affected and in what ways?

1.80 Those affected include:

(a) all road users;

(b) vehicle owners, private and commercial;

(c) vehicle manufacturers, distributors, and repair shops and garage equipment producers;

(d) vehicle testers;

(e) insurers;

(f) regulatory authorities, including the police;

(g) all concerned with environmental issues.

1.81 All are affected by the costs of accidents, and all might benefit to some extent from a more effective EU internal market and better use of modern communications technology.

1.9. How would the problem evolve if present policies are maintained?

1.1.18. Road safety

1.82 There is a significantly improving trend in road safety, due to improvements in vehicle design and other factors,[28] and there is no reason to doubt that a similar trend would continue. There would, however, still be significant numbers of accidents, and the potential for more efficient operation of the EU single market would continue to be under-exploited.

Figure Error! No text of specified style in document..4: EU road accident fatalities, 1991-2009

Source: CARE (EU road accidents database) and national data. *2009 figure is a provisional estimate.

1.83 We see no reason to expect a significant divergence from this trend if present policies (which include continued work by the Commission through comitology to improve the system of testing, and other initiatives foreshadowed in the Commission’s Policy Orientation) continue. Substantial action has been undertaken in the last ten years under the EU’s road safety action programme 2001-2010; and many new measures are currently envisaged in the EC white paper for the period up to 2020, including improving driver education and increasing enforcement of road rules as well as working towards environmental targets. Vehicle designs are being continually improved, and on-board diagnostic equipment is becoming cheaper and more widely used. All of these effects will be part of the forecast on unchanged policies for PTI and roadside testing.

1.84 An example of an initiative related to road safety that is already proposed for the period 2010-2020 is the introduction of mandatory fitting of tyre-pressure monitoring systems. The fitting of automatic warning systems for tyre pressure in new cars has been mandatory in the United States since 2008. While the fitment of tyre pressure monitoring systems is currently included as a recommendation in EU legislation, this is expected to change starting from 2012, when new EU Regulation requiring the mandatory fitting of tyre pressure monitoring systems in all new models is planned to be introduced, followed by the mandatory fitting of this equipment in all new vehicles by 2014.[29]

1.85 Keeping tyres at the correct pressure has positive impacts on the environment, fuel consumption and tyre wear, in addition to the safety benefits of reducing road accidents through giving vehicles a better grip on the road. In the US, the introduction of mandatory automatic tyre-pressure warning systems was calculated to be expected to cause a reduction in road deaths of 0.8 per cent. Based on the number of road deaths in 2008 in the EU of 38,875,[30] a 0.8 per cent reduction in deaths would amount to 311 fewer fatalities.

1.86 One estimate of the future evolution of road fatalities and injuries in the period 2011-2010 has been constructed as part of the European Road Safety Action Program (ERSAP).[31] A log linear future trend was chosen (meaning a constant percentage change each year) on the grounds that the higher the level of safety on the roads the more difficult to further decrease the number of injuries and fatalities. Two scenarios were calculated based on different assumptions about current and future road safety measures. The optimistic scenario assumes that both current safety measures, introduced in 1995-2008, and new safety measures, introduced in 2008-2020, will have a positive impact on road safety in the period 2010-2020. The pessimistic scenario assumes that the effect of current measures fades away and so these measures will not have any further impact on road safety in 2010-2020.

Table Error! No text of specified style in document..4: Log linear extrapolation of recent trends in road safety

|| ERSAP Pessimistic scenario || ERSAP Optimistic scenario

2020 || % reduction from estimated 2010 level || 2020 || % reduction from estimated 2010 level

Fatalities || 26,948 || -23% || 22,048 || -37%

Injuries || 1,459,205 || -9% || 1,395,064 || -13%

Source: Summary of the ERSAP scenario as provided by DG MOVE

1.87 This suggests that, by 2020, if the log linear trend in fatalities is assumed, total EU road deaths will have dropped by 23 to 37 per cent, down to between 22,000 and 27,000 a year. Injuries will also have seen a decline, although on a smaller scale: down by around 10 per cent.

1.88 However, a log linear trend may not be the most appropriate model in this instance. A number of Member States in the EU still have low levels of road safety and therefore there are potentially significant opportunities for fatalities to still decrease in certain regions. In addition, analysis of the historic data on road fatalities, as available for the years 1991-2008[32] shows that a linear trend fits the data better than a log linear trend.[33]

1.89 Therefore, for robustness, we also estimated the likely evolution of road accidents under the assumption of a linear trend. We used a simple linear regression, without adjustments for the projected increase in mobility or providing for the possibility that the effects of RSAP (2003-2010) are not durable, as taken into account in the ERSAP scenarios. Pessimistic, middle and optimistic estimates of the predicted future accident levels under a linear trend were constructed using the best estimate and the 95 per cent confidence interval for the gradient of the slope.

Table Error! No text of specified style in document..5: Linear extrapolation of recent trends in road safety

|| Pessimistic scenario || Middle scenario || Optimistic scenario

2020 || % reduction from estimated 2010 level || 2020 || % reduction from estimated 2010 level || 2020 || % reduction from estimated 2010 level

Fatalities || 18,641 || -47% || 16,628 || -53% || 14,615 || -58%

Injuries || 1,597,368 || -2% || 1,501,130 || -7% || 1,404,891 || -12%

Accidents || 1,186,843 || -3% || 1,126,724 || -7% || 1,066,605 || -11%

1.90 If this linear trend in fatalities is assumed we would therefore expect to see road deaths fall by around 1,900 deaths a year, road injuries by 11,000 a year, and road accidents by 9,000 a year. This suggests that, by 2020, total EU road deaths will have dropped by 47 to 58 per cent, down to between 15,000 and 19,000 a year. The decline in injuries and accidents would be on a smaller scale, each down by around 7 per cent.

1.91 The choice of forecast used has a large impact on the conclusion to be made regarding whether or not the Commission will need to enact additional legislation in order to meet their aim of halving the overall number of road deaths in the EU by 2020, starting from 2010. If the log linear model of the trend is to be believed then the conclusion is that the Commission’s target will not be easily met, even under the optimistic ERSAP scenario. Conversely, if the linear model is believed to more accurately reflect the likely future trend in fatal accidents then - if this trend rate of decline of fatal accidents is able to be achieved purely through the continuation of present policies - the Commission’s aim would be met without the requirement for any additional legislation or other new policy initiatives.

1.92 Taking the two forecasts above into consideration, we can provide a cautious estimate of the likely scale of the reduction in road fatalities between 2010 and 2020 as lying between 23 and 58 per cent.

1.93 Recent incentives by different Member States to encourage citizens to purchase new cars and scrap old cars will have temporarily accelerated the improvement in the average safety of the EU vehicle fleet, so a steep reduction in the number of accidents may be witnessed early on in the period 2010-2020. This expected reduction is not reflected in either of the forecasts as given above.

1.94 The fact that the forecast shows that the target of halving the overall number of road deaths may be met without any new legislation does not of course affect the need for the Commission to consider whether new legislation would be beneficial; it simply affects the size of the problem to be addressed, which is not meeting a particular target but of improving the welfare of citizens. It should be added that the aim of “halving” was probably chosen for political effect rather than as a result of any close calculation of what would be feasible, or optimal. Furthermore, the Commission should also consider that under the extrapolations as presented in Table 3.3 and Table 3.4 above, there would still be between 900 and 1,600 deaths and around 84,000 to 96,000 injuries in 2020 to which a technical fault in the vehicle had contributed.[34]

1.95 Also, fatal accidents only consist of a small percentage of the total number of accidents. Based on the estimates above the number of accidents with injuries will only see a very small reduction in the next ten years.[35] In addition, although there has been an overall decline in the number of road fatalities, the same trend has not been seen for all vehicle categories, in particular for motorbikes.

Figure Error! No text of specified style in document..5: Change in number of road fatalities by vehicle type (1997=100)

Source: DEKRA (2010) “Verkehrssicherheitsreport Motorrad 2010: Strategien zur Unfallvermeidung auf den Strassen Europas”

1.1.19. Single market issues

1.96 As EU integration proceeds, more people may wish to move from one country to another; or to have holiday homes in other Member States, leaving their cars there; and it may also be assumed that road transport undertakings will increasingly be operated on a pan-EU basis.

1.97 Several Member States or involved organisations (with permission from the Member State government but with no direct involvement of the relevant Member State department) have reached agreements with others for the bilateral recognition of their PTI results. We would expect a larger number of testing stations to start implementing similar agreements in the future, for pairings where this is cost-effective. These agreements would alleviate some of the single market issues outlined above.

1.98 Recent decisions by the ECJ (in 2007 and 2008) will also help to alleviate the single market problems identified above and reinforce the move towards a single market. The 2007 decision[36] held that the Netherlands had failed to fulfil its obligations under Articles 28 EC (free movement of goods) and 30 EC (proof that the national provision is proportionate to the objective pursued) by requiring vehicles which are more than three years old and which have previously been registered in other Member States to undergo testing as to their general condition prior to registration in the Netherlands. The ECJ noted that, although road safety and the protection of the environment do constitute overriding reasons in the public interest capable of justifying a hindrance to the free movement of goods, the requirement for cars to undergo testing before registration was unnecessary as a similar result could be achieved by less restrictive measures.[37] Similarly, the 2008 decision[38] held that Poland had failed to fulfil its obligations under Article 28 EC (free movement of goods) by subjecting imported second-hand vehicles registered in other Member States to a roadworthiness test prior to their registration in Poland, whereas domestic vehicles with the same characteristics were not subject to such a requirement.

1.10. Does the EU have the right to act and is there evidence of EU added value?

1.99 Here we need to consider any fundamental rights issues, the Treaty base, and the ‘necessity test’ (subsidiarity).

1.100 We see no fundamental rights issues in this area.

1.101 The EU has recently passed legislation controlling both PTI and roadside testing, so the legal precedent for action in this area has been established.

1.102 The Treaty requires the Commission to seek the right balance between legislation at EU and at national level (subsidiarity).

1.103 PTI is not an area in which it is immediately obvious that the EU is a more efficient level of government than Member States, and we assume that a significant measure of consensus would be needed before significant changes are brought into effect, particularly if changes were to require any major additional costs. This is taken into account in analysis of policy options. This approach would also help to ensure that action is only taken where “EU value added” is evident.

1.104 With regard to roadside testing as a method of directly increasing road safety, it is hard to see any requirement for action at the EU level action. The damage done by inadequate roadside tests falls on the road users in the Member State concerned; there is hardly any implication for other parts of the EU.[39] Nor is it necessary for similar approaches to be taken in different Member States; apart from making statistical comparisons more easily, therefore helping to inform EU policy, harmonisation in itself would not deliver concrete advantages.

4 Objectives

1.11. What are the general policy objectives?

1.105 The general policy objectives are to:

(a) improve the systems of PTI and roadside testing so as to contribute, with other policies, to a cost-effective reduction in the number and severity of road accidents and adverse effects of road vehicles on the environment;

(b) reduce the costs and administrative burden for people and businesses wishing to have their vehicles tested in different countries, and facilitate other improvements in the operation of the EU single market.

1.106 These objectives would both be achieved if a system of mutual recognition of PTIs was able to improve the efficiency of the single market while also increasing road safety, reducing the environmental disbenefits of road transport, increasing the provision of information wherever necessary and reducing administrative burdens. However, it is recognised that some of these objectives may conflict, in which case the guiding principle should be to select the policies that would do most to enhance EU citizens’ welfare.

1.12. What are the more specific/operational objectives?

1.107 The specific/operational objectives, in SMART terms as recommended in the IA guidelines, include the following. The time frame for each should be within the period to 2020, in line with the strategy document targets mentioned earlier. All are Specific; Measurable; Achievable, Relevant and Time-framed:

(a) to reduce the proportion of vehicles which are not compliant and therefore present a risk to other road users and to the environment, as measured by the number of vehicles which fail roadside tests;

(b) to make it easier for people wishing to use the right to move freely within the EU and for firms operating international road transport businesses to have their vehicles tested wherever is most convenient;

(c) to make it easier for people wishing to use the right to reside freely within the territory of the Member States to have previous tests in other MS recognised;

(d) to increase the scope for vehicle testing stations to offer services to vehicles registered in other Member States, provided that this does not lead to an unjustifiable reduction in standards;

(e) to make it easier for those carrying out PTIs and roadside tests to have reliable information on the vehicle components (e.g. specifications related to the equipment), including information on any modifications made since the vehicle was first produced (this objective would require improved data exchange);

(f) to support consumer protection in the second-hand vehicle market taking into account the vehicle history, including milometer readings.

5 Policy Options

1.13. Definition of policy options

1.1.20. 5 E’s approach

1.108 To reduce road accidents researchers sometimes refer to the “5 E’s approach”. [40] These stand for:

– Education: targets the road user and tries to change the attitudes and behaviour of individuals through various forms of communication;

– Encouragement: sometimes intertwined with education and can include some form of incentive programmes;

– Enforcement: legal actions such as traffic enforcement;

– Engineering: measures taken to improve transport infrastructure; and

– Evaluation: assesses if the strategy used was successful or not.

1.109 To achieve greatest effect the 5 E’s should be used in combination. The policy options considered do aim to use elements of each of these approaches.

1.1.21. Eight pillars of PTI and roadside testing

1.110 Eight factors that affect the success of PTI and roadside testing are:

1. items to be inspected and inspection method (these aspects can be amended through EU comitology proceedings);

2. definition of defects and assessment of result of test;

3. equipment to be used;

4. skills and application of staff;

5. vehicle classes to be inspected;

6. frequency of testing;[41]

7. supervision of the testers and enforcement of the system; and

8. data / information exchange.

1.111 We refer to these as eight “pillars” on which an ideal testing system would have to rest; or as eight features that would need to be present in any effective system.

1.112 The following policy options are considered. They are intended to be broadly incremental; so that Option 2 would follow naturally from Option 1, Option 3 from Option 2, and so on. They may thus provide a sense of direction, or a path on which policy might develop. However, as the Options are developing along two dimensions (road safety and single market), the exact ordering of the implementation of some aspects of Option 4 (road safety) and Option 3 (single market), and similarly Option 2 (single market) and Option 1a (road safety), contains some flexibility; and from some perspectives Option 4 (standardisation) might seem a natural precursor to Option 3 (mutual recognition). The development of policy in incremental steps has the advantage of allowing the best use by policy makers of information which becomes available along the way – directing the end solution to its most optimal position.

1.113 The main options considered are:

1.1.22. Option 1: Continuation of present policies

1.114 Option 1 provides the counterfactual case against which the effects of other policy options are to be compared. It is included in any impact assessment for this reason, and also as a partial check against any tendencies towards over-regulation; the case for a new policy intervention needs to be established.

1.115 Option 1 would maintain the present legal framework for PTIs, roadside inspections and on the exchange of information, as summarised in Section 1 above, and include established policies for its evolution.

1.116 This option does not therefore imply freezing present arrangements. Present policies include the use of comitology proceedings to keep the system up–to-date, and any continued improvements by Member States and others involved to the cost-effectiveness of the system. We have already noted that EU Member States are currently engaged in seeking greater efficiency from public sector activities; the increasing provision of on-board diagnostic devices (OBD) by vehicle manufacturers is another example of change likely to continue under existing policies.

1.117 It should also be noted that under present EC legislation only the first “pillar” (the items to be inspected and the inspection method) can be altered through comitology. Changes in other aspects of PTI and roadside testing would remain largely at the initiative or discretion of national governments and others involved.

1.1.23. Option 1a: No new legislation, but enhanced implementation and enforcement

1.118 This option would not introduce any new legislation, but there would be increased effort by the Commission to improve the standards of testing and to increase the advantages for citizens and EU businesses of the single market.

1.119 Such increased activity would include the screening of existing systems and the evaluation of strategies to overcome their limits (e.g. encouraging better implementation and enforcement).

1.120 In particular, Option 1a would involve increased use of some or all of the following:

(a) peer reviews and screening (EC);

(b) exploration of optimal levels of investment in PTI and roadside testing (EC, MS);

(c) exploration of the scope for risk-based testing regimes (e.g. taking account of warranty lives; taking account of mileage covered as well as time passed; taking account of whether a vehicle has been involved in an accident) (EC, MS);

(d) exploration of the scope for other measures to help motorists to decide when vehicles should be tested (e.g. including enforcement of legal responsibilities of the individual in some MS). These might include PR campaigns focusing on the actions that vehicle owners should be taking (EC, MS);

(e) Member State led enhancement of roadside inspections and testing supervision (MS);

(f) voluntary action by vehicle manufacturers (manufacturers)

(g) the Commission services could prepare to institute infractions proceedings if required (EC).

1.1.24. Option 2: Encourage bilateral agreements and better implementation

1.121 Under this option, in addition to better implementation of the present law as in Option 1a, Member States would be encouraged to seek bilateral or multilateral agreements for the mutual recognition of tests done in either country.

1.122 This option would involve the use of some or all of the following:

(a) an EC guidance document;

(b) best practice exchange;

(c) information exchange (to reduce any risk of fraud and to minimise the administrative burden data will need to be exchanged e.g. information confirming that a vehicle has passed a PTI. Information exchange techniques could vary across Member States).

1.123 The Commission would be responsible for facilitating these three actions, but decisions would be made by the Member States.

1.124 As with Option 1a, no new legislation would be needed to pursue Option 2.

1.1.25. Option 3: Mandatory mutual recognition throughout the EU

1.125 This option would introduce new legislation to require each Member State to recognise the validity of vehicle testing carried out in any other Member State. This would mean that:

(a) any vehicle could be inspected in any Member State;

(b) Member States would be obliged to recognise the certificates issued by other Member States as equivalent to theirs (with no additional requirements or conditions).

1.126 However, the frequency of the PTI in the Member State of registration would have to be respected.

1.127 Option 3 might be politically feasible only if the standards of testing in every Member State were acceptable to every other Member State (although in theory it could be imposed through majority voting). However, above such a minimum standard, there would be no requirement to make the methods of testing the same. This would therefore follow the precedent in other sectors, where mutual recognition does not depend on full standardisation of methods. There is at present no evidence on whether or not Member States would find mutual recognition based on present standards to be acceptable; this is something the Commission would need to explore.

1.128 There would be a need to define the information exchange standards required for mandatory mutual recognition and minimum data visibility, and perhaps to provide infrastructure to facilitate data exchange.

1.1.26. Option 4: Impose a mandatory standard EU-wide system for PTI and roadside testing

1.129 Under Option 4, in addition to requiring mutual recognition new legislation would prescribe the minimum standard of testing to be required. This could involve legislation to control all of the eight ‘pillars’ described above.

1.130 Thus PTI and roadside testing requirements would include details of:

(a) items to be inspected and inspection method;

(b) definition of defects and assessment of result of test;

(c) equipment to be used;

(d) skills or training of staff;

(e) vehicle classes to be inspected;

(f) frequencies of PTI;[42]

(g) the system for supervision and enforcement; and

(h) the system for information exchange. (In addition to the information exchanged under Option 3 information would be needed from the on board diagnostic (OBD) and the information from installed equipment.)[43]

1.131 Under this policy option, Member States would be permitted to apply tests that were above the minimum standards, but could not require the same from other Member States whose certificates they would be obliged to recognise, as is the case in the field of type approval where there is a common minimum standard that must be respected.[44] Thus Option 4 would include mutual recognition as in Option 3, but also require more standardisation of testing methods.

1.132 Three different possible levels of PTI testing have been outlined by DEKRA for the purposes of this impact assessment, and these are now specified:

– Option 4a: Least rigorous

– Option 4b: Medium level

– Option 4c: High level.[45]

1.1.27. Option 4a: Least rigorous

1.133 This is defined according to the existing directive 2010/48/EU. Therefore it should be seen as the minimum standard possible at which to impose a mandatory standard EU-wide system for PTIs, as in DEKRA’s assessment nearly all Member States have already established their PTI system above this level.

1.134 The following table summarises what is involved.

Technology and procedures || Roller brake test bench, pit or power lift, head lamp aiming device, CO – Lambda for petrol and K – value measurement for Diesel engines Items only need to be visually inspected and procedures for the use of roller brake testing are as mentioned as a reference to ISO 26096.

Frequency of tests || 4-2-2 M1N1 1-1 M23N23O34 and others*

Vehicle categories covered || M123 - N123 - O34

Personal skills and qualifications || No definition

Supervision and enforcement || RSI – Reporting to the Commission according to 2010/47/EU, special measures if non-public bodies are involved (Chapter 1/2, 2009/40/EU)

* For taxis and ambulances

Source: DEKRA

1.1.28. Option 4b: Medium quality

1.135 Under Option 4b, a medium standard of PTI would be defined, and made compulsory for all Member States as the minimum required. It might involve:

Technology and procedures || Roller brake test bench, suspension test bench, head light tester, power lift with hydraulic play detectors, automated data collection, brake pressure measurement for power brakes, OBD for emission testing, CO – Lambda for petrol and K – value measurement for Diesel engines Different fixed definitions of measures and procedures for undertaking the tests may be used.

Frequency of tests || 3-2-2 M1N1O12L345 1-1 M23N23O34 (additional safety tests in between)

Vehicle categories covered || M – N – L – O (all vehicles that are registered)

Personal skills and qualifications || Technician with additional education for PTIs with yearly training of more than two days.

Supervision and enforcement || Regular quality checks done by governmental departments – as well as roadside inspection targeted selection

Source: DEKRA

1.1.29. Option 4c: High quality

1.136 The highest standard envisaged for the purpose of this assessment was defined as follows:

Technology and procedures || Roller brake test bench, suspension test bench, head light tester, power lift with hydraulic play detectors, automated data collection and storage, load simulation for trucks, brake pressure measurement for power brakes, use of scan tools for the test of electronic components as well as for emission testing in addition to CO – Lambda and K – values also for motor cycles (L345)

Frequency of tests || 3-2-2-1 M1N1O12L345 1-1 M23N23O34 (additional safety tests in between)

Vehicle categories covered || M – N – L – O (all vehicles that are registered)

Personal skills and qualifications || Qualified technician or engineer with additional education for PTIs with yearly training of more than three days.

Supervision and enforcement || Regular quality checks done by governmental departments Roadside inspection for M1 and N1 as well as M23 and N23 (sufficient number and method to be statistically firm)

Source: DEKRA

1.137 The three options 4a, 4b and 4c as described above relate to the costings as calculated later in the report.

1.138 It is worth noting that some Member States already require more stringent roadworthiness testing regimes than described in 4c. For instance, the UK and Slovakia both require a testing schedule of 3-1-1 for M1 vehicles. We base our description of the PTI frequency required for cars for the high quality testing level on the optimum frequency as determined in the AUTOFORE report. As additional studies on cost benefit analysis of PTI frequency become available, the recommended highest frequency level may need to be updated.

1.139 To illustrate the maximum levels of the different components of the PTIs currently in place in different Member States in the EU the following description is provided:

1.13.10.1. Most rigorous (not considered in this report)

Technology and procedures || Roller brake test bench, suspension test bench, head light aiming tester, automated data collection and storage, load simulation for trucks, brake pressure measurement for power brakes, use of scan tools for the test of electronic components as well as for emission testing in addition to CO – Lambda and K – values also for motor cycles (L345) Different fixed definitions of measures and procedures for undertaking the tests may be used.

Frequency of tests || 1-1 M1N1O12L345[46] 0.5-0.5 M23N23O34 (additional safety tests in between)

Vehicle categories covered || M – N – L – O (all vehicles that are registered)

Personal skills and qualifications || Vehicle Engineer with additional education for PTIs with yearly training of more than four days

Supervision and enforcement || Undercover tests, regular quality checks done by governmental departments – quality assurance system according to ISO 17020 Roadside inspection for M1 and N1 as well as M23 and N23 (sufficient number and method to be statistically firm)

Source: DEKRA

1.140 The testing regime as described above is more prescriptive than any currently in place in the EU and therefore is not an option at this time. Based on future research a very high level of roadworthiness testing such as this may become either more or less attractive as an option in the future.

1.141 Three similar tables relating to different possible levels for roadside inspections are given in Appendix 5: .

1.1.30. Option 5: Deregulation at EU level

1.142 Under this option, the EU would withdraw from the field and leave Member States to decide what forms of vehicle testing if any they wished to implement.

1.14. Information exchange

1.143 Information sharing is part of all of the policy options described, the level, value and necessity of information sharing depending to some extent on the policy option.

1.144 As discussed in detail in Appendix 4, data exchange is valuable for two fundamentally different reasons:

(a) it facilitates policy analysis; and

(b) it facilitates efficient operations of tests and other transactions.

1.145 For the first purpose, details of individual vehicles are not needed; and time is not generally of the essence. For operational purposes, a different technology is appropriate, since little analysis is needed, but records of individual vehicles and tests need to be available promptly. Mutual recognition (under Options 3 or 4) would require improved exchange of operational data, which would also assist in other options.

1.15. Possible combinations of policies

1.146 As this impact assessment is looking at improving on two issues, road safety and single market aims, there are two separate strands of action that can be taken, one relating mainly to road safety improvements and the other to the creation of a single market in vehicle testing. Either strand of action could theoretically be taken without requiring any action towards the other objective. However, as the two issues are linked by the fact that reforms to the system of vehicle inspections might contribute to both their solutions, the most efficient solution is likely to be a combination of both a push for the single market and increased efforts to improve PTIs in the EU. We have also already noted that it is possible that there may be a policy trade-off; e.g. mutual recognition without standardisation at a high level could in theory reduce safety standards, whilst standardisation at a high level might take a long time to achieve during which progress on mutual recognition might be delayed.

1.147 The table below displays the two dimensions along which action can be taken, and where the policy options fall into this framework.

Table Error! No text of specified style in document..6: Policy options in relation to single market and PTI improvements

|| No additional push for single market || Encourage bilateral agreements || Mandatory mutual recognition

Continuing updates under comitology || Option 1 || Possible || Politically infeasible?

Enhanced implementation and enforcement || Option 1a || Option 2 || Option 3

Imposition of minimum standards – requiring change of legislative framework || Single market effectively already exists in this case || Mutual recognition likely to be as easy to implement as bilateral agreements || Option 4

1.148 The interrelationships between policies are explored in the following section.

6 Analysis of Impacts

1.16. Scope of analysis

1.149 The IA guidelines require us to consider the likely economic, social and environmental impacts of each of the short-listed options, including where relevant impacts outside the EU, and including of course both negative and positive effects and how impacts might develop over time. The commentary should consider which social groups, economic sectors or particular regions are affected; and the potential obstacles to compliance.

1.150 In this case we see little relevance for countries outside the EU.

1.17. Initial overview of options in relation to objectives

1.151 An overview of the relation between each policy option to the policy objectives is given in the following table. The impacts of the policies are evaluated incrementally – so the impacts given relate to the change that would be seen relative to the policy option before. To illustrate: the table shows a reduction of accidents as a result of Option 1, but no reduction from Option 2. Since Option 2 would include Option 1, there would be an overall reduction, but no more from the additional components.

Table Error! No text of specified style in document..7: Policy options in relation to incremental impacts

Objective Policy option || Reduction in accidents || Favourable impact on environment || More integrated EU market || Improved provision of necessary information wherever needed || Reduction in administrative burden

Option 1: No new policy action || Zero impact (by definition) || Zero impact (by definition) || Zero impact (by definition) || Zero impact (by definition) || Zero impact (by definition)

Option 1a: No new legislation, but better implementation || Yes || Yes || No || No || Yes (best practice solutions)

Option 2: Encourage bilateral agreements and better implementation || No || Small benefit || Yes || Yes || No

Option 3: Mutual recognition of PTIs throughout the EU, made obligatory by new EU legislation || No (possible negative effect) || Uncertain || Yes || Yes || Uncertain

Option 4: Impose through EU legislation a standard EU-wide system for PTIs || || || || ||

Option 4a: Basic standard || No (possible negative effect) || Uncertain || Yes || Yes || No (possible negative effect)

Option 4b: Medium || Yes || Yes || Yes || Yes || No (possible negative effect)

Option 4c: Most rigorous || Yes || Yes || Yes || Yes || No (possible negative effect)

Option 5: Deregulation at EU level || No (negative effect) || No (negative effect) || No (negative effect) || No || Yes

Source: Europe Economics, DEKRA, CENTIQ

1.152 We now discuss each of the options and consider the likely impacts of alternatives to present policies.

1.18. Option 1: No new policy action

1.153 Option 1 provides the counterfactual against which the likely effects of other policies are to be assessed. This option is seen as suboptimal by DG MOVE, which believes that there is clear scope for improvements in the effectiveness of testing, including through better exchange of information, to which action at EU level could contribute.

1.18.1.1. PTIs

1.154 With a continuation of present policies, the systems of PTI and roadside testing in use would continue to evolve. For example, the AUTOFORE report recommended an increase in the minimum frequency of tests.[47] On the other hand, the Dutch Government has recently reduced the frequency of tests for cars[48] and the UK considered doing so, but decided that its present practice (which involves some of the most frequent testing in the EU) was optimal for the UK.[49]

1.155 Nonetheless, under Option 1 the pattern of frequency of tests might be expected to remain broadly as at present, and as shown in the following table.

Table Error! No text of specified style in document..8: Present frequencies of PTIs

|| Private cars || Goods vehicles < 3,500 kg || Goods vehicles > 3,500 kg || Passenger vehicles < 8 passengers || Passenger vehicl